Comentary is pissing me off.

[pecunium]

NPR is airing the SOTU.

The woman speaking just bought into the President's Social Security story. Praise for her saying privatize, but she said the Dems need to put up an alternative proposal.

Which is giving in. The System isn't broken. It isn't even that ill-structured.

But she just conceded his position... if it needs to be fixed then it's unwell.

All the Dems need to do is stand up and say, "There is no Crisis."

Comments

Re: There is no crisis

[pecunium.livejournal.com]

Because there is no crisis.

The Dems were trying to improve the plan, not fix it. They caved into political necessity and said they were reforming it.

This inadvertantly; no it wasn't inadvertant, the Republicans have been trying to scuttle Social Security for not less than forty years, and more like 70, made it seem the program was in trouble.

Thirty years ago, it was. Reagan and Greenspan came up with a plan to avoid that; they raised taxes. It worked. There is a surplus in the SS budget, and that surplus is meant to be used to pay for the anomaly caused by the depressed/delayed birthrates of WW2.

The president told lies in his State of the Union Address.

Our society has changed in ways the founders of Social Security could not have foreseen. In today's world, people are living longer and therefore drawing benefits longer - and those benefits are scheduled to rise dramatically over the next few decades.

As Josh Marshall points out. In 1934... the actuaries predicted that the proportion of Americans over 65 -- then only 5.4 percent -- would rise to 12.65 percent in 1990... They were just a tad high; the actual figure would be 12.49 percent.

So we are on track. What they didn't forsee was the lack of straight increase caused by WW2 (the baby boom actually isn't a boom, it's a return to the mean, after the decline of the depression and the war). This is what Reagan and Greenspan tweaked.

When the Republicans say the system will be bankrupt in "x" years (choose the number they are using this week) as the president did in the SOTU Address, they lie.

From the Congressional Budget Office we see that in 2053 CBO finds that the benefits paid will be 22 percent lower than the scheduled benefits.

The interesting thing here is the part I underlined. Scheduled. That means the increases built in. Not from today, but from tomorrow. Those are the same benefits the Republicans say are growing too much, and they want to cut, by changing the indexing method. If they do that, the problem they describe as bankrupt, won't come to pass.

So they are trying to have my cake, and eat it too.

The other thing is the apple and oranges numbers they use.

If the economy grows enough to pay the returns they say the private accounts (which aren't really yours, they are only going to let you have any surplus; beyond that which paying into SS would have paid you. The capital, and most of the profits, they intend to keep. On the flip side, if the markets do poorly, you lose out. That however isn't the question you asked, which is why there is no crisis), then payroll taxes will be increased too (because a rising tide lifts all boats) and there will be enough money.

If the economy does so poorly that payroll taxes won't cover the bills, then it won't do enough to make the money they say diverting your money to Wall Street is supposed to.

Then there is the sheer gall. We paid the money. They want to take it away, and then borrow a couple of trillion dollars to cover the theft.

It's a scam, because there is no crisis.

TK