Social Security Swindle

[Bronco_Beerslug]

Bush's invasion of Iraq and tax cuts for Americans earning over $200,000 are eating away taxes paid into SS. Along with the record deficit, the record trade deficit and the record National Debt the Bush administration is trying to bankrupt SS also. His lackey Greenspan forgets to mention the reason why benefits have to be cut or taxes raised to pay benefits promised to 10s of millions Americans and mandated by law.

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A Social Security swindle
By Barney Frank | September 28, 2004

SOMETIMES mixed metaphors say it best. Federal Reserve chairman Alan Greenspan's call for significant reductions in Social Security can best be described as a case of the fox in the chicken coop crying wolf. He is greatly exaggerating the dimensions of a problem that he helped create.

Greenspan recently said, "We have promised more than our economy has the ability to deliver to retirees." He argued that we have the choice either of raising payroll taxes, which are regressive and economically burdensome, or reducing cost-of-living adjustments while raising the retirement age. The assumption that leads him to pose this stark choice is that the federal government does not have enough revenue available to deliver the benefits we have promised retirees.

What he omitted to note is that if all of the payroll taxes that have been and will be paid into Social Security are made available for Social Security payments as they are supposed to be, the system is entirely solvent until 2042 at least.

To quote the July 2004 Federal Reserve Monetary Policy Report: "As of the first quarter of 2004, national saving . . . was still equal to just about 2 1/2 percent of GDP, compared with the recent high of 6 1/2 percent in 1998." Why is national savings this year only one-third of what it was six years earlier? The cause is "the deterioration in the unified budget since 2000." Specifically, "measured net of estimated depreciation, federal savings fell from 2 percent of GDP to minus 4 percent of the GDP over this period."

Of course, a major reason we face this situation is the Bush tax-cutting that Greenspan endorsed. According to the report, "In large part, the rise in the deficit is attributable to further rapid increases in spending on defense and other programs and the loss of revenues resulting from the tax legislation enacted in recent years."

http://www.boston.com/news/globe/editorial_opinion/oped/articles/2004/09/28/a_social_security_swindle/

[Mile High Shack]

dangit...another secret neo-con secret exposed

this reporter must die...the boston sect should be on this one

[Bronco_Beerslug]

dangit...another secret neo-con secret exposed

this reporter must die...the boston sect should be on this one
Ah, I see you used your usual, well thought out reply.

[Mile High Shack]

anyone who thinks SS will be there when you retire (if your in your 20's or 30's now) then your smoking some hippie grass

It's a flawed program that needs major tweaking.

[plummerrox]

yep there have been absolutely no problems with the Social Security System until GWB took over. It wasn't a campaign issue in 2000, 1996, 1992, 1988,1984....It's all part of the evil plan to ensure that everyone ends up living off canned dog food. You've got him this time. Nice work. Someone get Rather on the phone.

[Hercules Rockefeller]

So was Greenspan Clinton's lackey too?

[W*GS]

Bush's invasion of Iraq and tax cuts for Americans earning over $200,000 are eating away taxes paid into SS.

How? SS taxes are collected and dispersed separately from other taxes. I haven't seen the portion of my tax burden reserved for SS change at all for some time now; did your SS tax go up or something?

The problem, and it isn't new to GWB, is that the current annual SS surplus has been used to hide the actual size of the annual deficit. This wee trick goes back a long time. Essentially, the SS "trust fund" is nothing but a collection of IOUs from the US Treasury - I've seen estimates of the accumulated debt from SS (perhaps Medicare/Medicaid, I don't recall exactly) in the vicinity of $40 trillion.

You and Frank are wrong to assume that the parlous state of SS is something new. SS has been used to cover up federal deficits for years.

[Bronco_Beerslug]

So was Greenspan Clinton's lackey too?
Yep, he bends according to which way the wind blows.

[bendog]

Not really Wags. Using the soc sec taxes under WJC to reduce the debt owned by private individuals and foreign govts reduced the amout of gnp we have to collect in taxes to service the debt. That in turn increased the amount of gnp tax (or new debt we could issue to private people) to pay for soc sec benefits. What Frank is saying is that BushII's failure to control spending has ended the possibility of doing that. But, BushII's adivisors weren't shy in saying even before Iraq that their real aim was to create the fiscal crisis that would make us gut medicaid, and all other social programs like educ, housing aid, food stamps, etc just to keep soc security in some form. They couldn't win at the ballot box in a straight up or down vote on these programs, so they are back door defunding them.

As for soc sec longterm, my kid's generation - the mellinium - is bigger than the boomers. If we in effect could get a "bridge loan" to keep soc sec afloat until they come online, we'd avoid the funding issue untill they retire. but, it's pretty academic now, what with BushII's spending.