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View Diary: "Social Security Won't Be There" - The GOP's Desperate Big Lie (63 comments)

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  •  Oh for Goddess Sake! (0+ / 0-)

    The so-called "Trust Fund" was designed to be depleted by the time the Boomers die. That's the way Congress set it up in 1983, to take care of the Boomers retirement.

    The projections saying that SS will only have enough funds to pay 75% of benefits after 2033 are based on the assumption that there will be NO CHANGES in the economy between now and 2033.

    Removing the cap on income subject to the FICA tax, presently limited to the first $110,100 in yearly income, would make Social Security solvent through 2075. Making all income subject to FICA (I'm looking at YOU, capital gains) would extend solvency even more.

    The trust fund was designed to handle one demographic problem -- once that population dies off, no more problem.

    •  Moonspinner - the current cap is $113,700 (1+ / 0-)
      Recommended by:
      BvueDem

      Later this month the Social Security Defenders is having a blogging event and I will be writing about the cap. I think you completely misunderstand SocSec. It is not an income redistribution plan. It is a plan to "insure" a portion of the wages or salary that you earn so that when you retire it can be available to you. What need would someone have to "insure" their investment income when it does not require their labor and doesn't stop at retirement? As FDR said "from capital nothing is asked and to capital nothing is given". The same is true for someone earning $500,000 a year. The cap takes into account that high income earners likely have other retirement income available and don't need SocSec to insure unlimited earnings. Having high income earners contribute to the SocSec pool, with little or nothing in return, violates the core principles of the program. It would turn SocSec payments into a second income tax for high income earners.

      "let's talk about that"

      by VClib on Sat Mar 02, 2013 at 10:58:32 AM PST

      [ Parent ]

      •  Ahem -- I worked for the Social Security (3+ / 0-)
        Recommended by:
        ozsea1, musiccitymollie, VClib

        Administration. And some adjustment is going to have to be made to increase the revenue stream so that SSA can pay folks 100% of the benefits they're due after the Trust Fund is gone.

      •  As I have stated before (0+ / 0-)

        whenever this debate heats up and smoke fills the room:

        To keep the corporatists and other "concerned" and "better-informed-than-thee" participants from framing SS as a welfare program:

        Lift the cap; don't eliminate it. Progressively index benefits increases such that ALL beneficiaries have skin in the game.

        It's pretty straightforward.

        The "extreme wing" of the Democratic Party is the wing that is hell-bent on protecting the banks and credit card companies. ~ Kos

        by ozsea1 on Sat Mar 02, 2013 at 04:40:16 PM PST

        [ Parent ]

        •  oz - basically I agree (1+ / 0-)
          Recommended by:
          BvueDem

          The cap needs to be raised, maybe doubled, and the progressive feature of the program needs to be enhanced.

          "let's talk about that"

          by VClib on Sat Mar 02, 2013 at 06:59:21 PM PST

          [ Parent ]

        •  Respectfully, if you've got in mind the Bowles- (1+ / 0-)
          Recommended by:
          VClib

          Simpson recommendations for progressive price indexing--good luck trying to sell that to seniors, or young people, for that matter, LOL!

          Here's what IL Rep Jan Schakowsky has to say about their proposal in her Reuters Op-Ed entitled "The Sham Of Simpson-Bowles."

          snip

          Have Simpson-Bowles’ champions read it?

          Given any real scrutiny, this plan falls far short of being a serious, workable or reasonable proposal – from either an economic or political analysis.

          Under Simpson-Bowles, long-term solvency for Social Security is achieved mostly by cutting benefits. Seventy-five years out, the ratio of spending cuts to revenue increases is 4 to 1.

          They propose raising the age of full Social Security benefits to 69 – claiming that everyone is living longer.

          But a sizable percentage of Americans, mostly lower-income workers, especially women, are actually living shorter lives, and a large chunk of other Americans just can’t work that long – even if they can find a job.

          Their plan cuts benefits for current and future retirees by reducing the cost-of-living adjustment.

          For future retirees, all these changes taken together would reduce the average annual benefit for middle-income workers – those with annual earnings of $43,000 to $69,000 – by up to 35 percent  
          snip

          If progressives want to put a stop to so-called entitlement reform, all they need to do is run ads with several lines of her piece, and they rest would take care of itself.

          Bolstering the program could happen without draconian cuts to it, including progressive price indexing.  Only VERY limited indexing of benefits, at the top quintile of income should be considered, and only as a last resort.

          Just raise the cap on taxable wages, and implement a small payroll tax increase.

          Better yet, the US should get out of the business of empire building, and we wouldn't have a so-called fiscal crisis. :-)

          Mollie

          "If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

          hiddennplainsight

          by musiccitymollie on Sat Mar 02, 2013 at 09:58:50 PM PST

          [ Parent ]

    •  I just decided to contribute a piece (2+ / 0-)
      Recommended by:
      Roger Fox, ozsea1

      to the blogathon on the history of the Trust Fund. (Roger and I have been talking about what if anything I would throw in). Here is a teaser:

      Four myths about Social Security and the Trust Fund:

      One. The Trust Fund was created in 1983 as a mechanism for pre-funding Boomer Retirement. (This is three myths in one).

      Two. Lyndon Johnson put Social Security 'on-budget' in order to use Social Security surpluses to hide the real cost of the Vietnam War via the use of 'unified budget surplus/deficits'. (Mostly myth).

      Three. In 1983 Tip'N'Ronnie hammered out a deal to save Social Security over B and S's showing that you REALLY can make the Broderian/Brooks Bi-Partisany Dream reality.

      Four. Ronald Reagan (despite the deal) hijacked Social Security surpluses put in place to pre-fund Boomer Retirement in order to hide the cost of his tax cuts and military buildup. (A number of myths hidden in plain sight).

      None of that is right, and little is even remotely right. And while certain aspects of all four myths are pretty useful for the overall Defending Social Security project none of them are actually necessary. Instead you can use honest data and honest history to make the case for Social Security without resorting to any part of the mythology.

      And a fifth myth. The Trust Fund was designed to go to depletion and so be temporary.

      Hmm. No. And in a really, really odd twist, the Trust Fund was never designed to even be PAID BACK. But that will require a post of its own, or a series of posts. Because even the bare assertion just screams: THEFT!! Even though it is nothing of the kind-feature and not a bug. And still less a crime.

      Til then-------

      socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

      by Bruce Webb on Sat Mar 02, 2013 at 11:27:45 AM PST

      [ Parent ]

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