In A Word – Social Security – In case privatization talk reemerges, know that it is alive and well.
Gerald Eisman
September 05, 2006
Social Security - A government program that provides economic assistance to persons faced with unemployment, disability, or agedness, financed by assessment of employers and employees.
It’s election time again and, considering the astonishing amount of distortions, fabrications and propaganda that has been passed off as fact on the topic of Social Security, it might be useful to present the truth in a simple, plain English. It may help combat any Bush financial distortions and a new campaign to privatize the social security system.
These are the facts. Social Security is financially in decent shape today. The program is neither going "bankrupt" nor facing any crisis. Any claims made that Social Security has an "unfunded liability" of "$11 trillion" are outright lies and, mass retirement of baby boomers will not bankrupt the social security. The projected so-called "doomsday" on Social Security actually has been stretching out farther than originally projected. Even at the so-called doomsday deadline, citizens will get 73-81% of the benefits they were promised even.
The myth of a social security "crisis" is based on a flawed projection that the economy and productivity will grow much slower in the future than it has in the past. The Right, however, is using an opposing claim that stock market returns will somehow be much better in the future than in the past! That prediction and the threat of a drastically slowed economy doesn’t compute.
What is really in crisis is the Federal Budget. The programs that are actually raising prospects of a crisis or even bankruptcy in the short term are President Bush's tax cuts and the Medicare Bill. Also, by the very definition of bankruptcy, our military is bankrupt now, not as projected to be in 2042 or 2052. Why are there no calls to "reform" the military? Since Medicare is far more of a problem it boggles the mind why reform advocates are not spending sleepless nights proposing solutions to that?
The Social Security trust fund, however, is not a myth. Dishonest privatization proponents use the term when convenient, and they conveniently drop it when inconvenient. Claims made by some Republicans that the Government is unlikely or not obliged to return funds borrowed from the Social Security Trust Fund are downright
Illegal. That would be like saying a homeowner didn’t have to pay off his mortgage.
It is the fervent wish of the Bush administration that people will remain uninformed about the fact that massive Social Security surpluses have been used for years to finance record General Fund deficits. These deficits were created by Bush's massive tax cuts for the super-rich, and out-of-control spending on his illegal war in Iraq and GOP pet projects.
Correcting Social Security's projected shortfall decades from now is actually easier now than it would have been in the past. Republicans resort to the scare tactic, quoting the number of workers per retiree, to buffalo the public. They say little or nothing about the financial robustness of Social Security. Still, this tactic is frequently used to bamboozle people into believing the hoax of a social security crisis. All the proposals to index social security payments to inflation rather than wages is an underhanded attempt to usurp taxpayer funds and deny retirees their due.
Though silent now, any renewed attempt at privatization of Social Security would mean a precipitous drop in program efficiency and sharp increases in administrative fees. All that would lead to would be significantly lower benefits. Privatization requires trillions of dollars in additional borrowing unhealthy and speculative investment of individual's funds in the stock market. That would mark the beginnings of another Bush driven disaster. Privatization proponents often use highly inflated/exaggerated stock market return projections to push for privatization. Still, even with the steady increase in some stock prices, many investors are losing money in the market.
The Bush privatization proposal, as it stood, would lead to benefit cuts and borderline poverty for many retirees.
Unfortunately, younger workers, women and minorities also would be sorely impacted. Claims that the current social security system is inherently unfair to African Americans is another outright lie. If the proposal again raises its ugly head, privatization could actually reduce economic growth, further endangering social security. It must be noted that Bush-style privatization has been tried before in other countries, with costly, disastrous results. It is possible the eventual objective of any renewed Bush privatization proposal would be the eventual phasing out of Social Security.
It’s election time again and, considering the astonishing amount of distortions, fabrications and propaganda that has been passed off as fact on the topic of Social Security, it might be useful to present the truth in a simple, plain English. It may help combat any Bush financial distortions and a new campaign to privatize the social security system.
These are the facts. Social Security is financially in decent shape today. The program is neither going "bankrupt" nor facing any crisis. Any claims made that Social Security has an "unfunded liability" of "$11 trillion" are outright lies and, mass retirement of baby boomers will not bankrupt the social security. The projected so-called "doomsday" on Social Security actually has been stretching out farther than originally projected. Even at the so-called doomsday deadline, citizens will get 73-81% of the benefits they were promised even.
The myth of a social security "crisis" is based on a flawed projection that the economy and productivity will grow much slower in the future than it has in the past. The Right, however, is using an opposing claim that stock market returns will somehow be much better in the future than in the past! That prediction and the threat of a drastically slowed economy doesn’t compute.
What is really in crisis is the Federal Budget. The programs that are actually raising prospects of a crisis or even bankruptcy in the short term are President Bush's tax cuts and the Medicare Bill. Also, by the very definition of bankruptcy, our military is bankrupt now, not as projected to be in 2042 or 2052. Why are there no calls to "reform" the military? Since Medicare is far more of a problem it boggles the mind why reform advocates are not spending sleepless nights proposing solutions to that?
The Social Security trust fund, however, is not a myth. Dishonest privatization proponents use the term when convenient, and they conveniently drop it when inconvenient. Claims made by some Republicans that the Government is unlikely or not obliged to return funds borrowed from the Social Security Trust Fund are downright
Illegal. That would be like saying a homeowner didn’t have to pay off his mortgage.
It is the fervent wish of the Bush administration that people will remain uninformed about the fact that massive Social Security surpluses have been used for years to finance record General Fund deficits. These deficits were created by Bush's massive tax cuts for the super-rich, and out-of-control spending on his illegal war in Iraq and GOP pet projects.
Correcting Social Security's projected shortfall decades from now is actually easier now than it would have been in the past. Republicans resort to the scare tactic, quoting the number of workers per retiree, to buffalo the public. They say little or nothing about the financial robustness of Social Security. Still, this tactic is frequently used to bamboozle people into believing the hoax of a social security crisis. All the proposals to index social security payments to inflation rather than wages is an underhanded attempt to usurp taxpayer funds and deny retirees their due.
Though silent now, any renewed attempt at privatization of Social Security would mean a precipitous drop in program efficiency and sharp increases in administrative fees. All that would lead to would be significantly lower benefits. Privatization requires trillions of dollars in additional borrowing unhealthy and speculative investment of individual's funds in the stock market. That would mark the beginnings of another Bush driven disaster. Privatization proponents often use highly inflated/exaggerated stock market return projections to push for privatization. Still, even with the steady increase in some stock prices, many investors are losing money in the market.
The Bush privatization proposal, as it stood, would lead to benefit cuts and borderline poverty for many retirees.
Unfortunately, younger workers, women and minorities also would be sorely impacted. Claims that the current social security system is inherently unfair to African Americans is another outright lie. If the proposal again raises its ugly head, privatization could actually reduce economic growth, further endangering social security. It must be noted that Bush-style privatization has been tried before in other countries, with costly, disastrous results. It is possible the eventual objective of any renewed Bush privatization proposal would be the eventual phasing out of Social Security.
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