6/21/2012 4:02 PM ET|
The great Social Security lie
If you think the retirement of baby boomers is the problem, perhaps you should know about the real root of the problem -- and how it needs to be addressed.
The headline machine was in overdrive earlier this year with the arrival of the latest Trustees' Report on SocialSecurity and Medicare. And while much of the media continues to herald the coming bankruptcy of Social Security, they do so at the risk of ignoring the real story -- a story that is neither difficult to explain nor hard to understand.
Technically speaking, an entity is deemed bankrupt when its obligations exceed its revenues. Therefore, if the projections are accurate, Social Security will, indeed, be deemed bankrupt in 25 years -- absent modifications to resolve the funding problems.
However, that does not mean that the money will be all gone come 2035. Nor do the headlines explain why we have the projected shortfall.
Subsequent to the projected expiration of the period where the trust can pay out 100% of the promised benefits, the fund will then be in a position to pay out 75% of promised benefits for the foreseeable future -- and that is not OK. Clearly, there need to be some changes made to Social Security so as to make up the 25% annual shortfall in benefits we anticipate will begin a quarter of a century from now.
The cause of the shortfall
But if we are to hope to make these adjustments in a sensible and realistic way, it might not be a terrible idea for the American public to actually understand the real causes of the shortfall in anticipated trust revenues.
We are consistently led to believe that it is the "aging workforce" that rests at the heart of Social Security' funding problems. Tune in to any of the media reports covering the numbers just out and this is what you are going to see and hear.
The claim, while legitimately representing a small piece of the problem, fails to explain the lion's share of the crisis we will experience in the Social Security Trust --and by lion's share, I mean a full 60% of the entitlement's funding shortages.
The "aging workforce" narrative serves to encourage and support the critics who claim that our problem is too many retirees lining up to collect their entitlements only to find that the government has failed to properly manage the Social Security Trust -- leaving the next generation of beneficiaries to be shortchanged 25 years down the line. As a result, the privatization pushers argue that Americans would be far better off looking out for their own retirement accounts so that government mismanagement will not come between hard-working citizens and their retirement money.
This is the Great American Social Security Lie.
It is a lie concocted by those seeking to fulfill Wall Street's eternal quest to get its sweaty palms on trillions of dollars of our retirement cash, allowing them to expand their casino operations beyond their wildest imaginations -- and Wall Street has a very healthy imagination.
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This is the most factual news article I seen in thirty years on the Social Security Programs financial challenges. It should be mandatory reading for all workers paying FICA taxes. Every year the Social Security Advisory Council is mandated by law to submits a report to Congress about the current and future financial needs of the program. These annual detailed reports address immediate as well as future needs as far out as fifty years. It's purpose is to give Congress the information necessary to address the programs immediate and future needs.
Managers of businesses large and small use this same process in evaluating what adjustments are necessary to meet their organizations goals and objective.
Unfortunately, Congress has consistently neglect to fulfill their fiduciary responsibility by reviewing and addressing the Social Security Programs needs as pointed out in these annual reports. As a result the public is faced with their political lies and sound bites to justify their irresponsibility actions or lack there off.
The truth is they have know for the past thirty years this was coming, if congress had addressed the programs needs, as pointed out in these Congressional reports we would not facing the financial lies they are placing at our feet today. Isn't it about time for the voting public to hold congress as responsible, as they are currently attempting to hold America's workers.
For those who've bought off on the political sound bites congress have put forth as solutions for Social Security you might want to reassess your position, while your doing this you might also want to review your retirement investments, after this recession.
The only problem with Social Security as it stands now is the "Government." They think the money is theirs. They keep borrowing from it when there is a shortfall and have borrowed billions. I don't ever remember them paying any of it back, but I'm sure they say they have. I have yet to see any proof .
The other point I want to make is that your employer pays in an amount equal to what you as a worker pays in. You are told this from the day you have to sign up, however you will never see any record of it or have it credited to you when figuring your monthly payment. I think they just skim this off and keep it for themselves. They will give you double speak that it's used to run the system, etc.
The only reform I can see the government making is giving you less and making you pay more so they don't have to.
Let's take the ponzi out of the system and set it up so that all the money is paid into an account in your name, much like an IRA, that you can not touch until retirement age. The government can't touch it either and no taxes on the amount earned by the money.
Did you ever wonder how much money the Feds take in on lottery winnings every year ? I have. Maybe they could use these funds to start paying back the money they borrowed (stole). No,that would not work either. The more you give these knuckleheads,the more they spend.
Let's face it folks,they have screwed the pooche
But they fail and as all economists do. State that the influx of illegals into the country forces wages lower. To say it doesn't, and I'll put it into the writters own words, " Is a great lie". Why would employers pay more when they can get an illegal to do it for less? And if you want to do the job you have to meet the illegals asking wages.
We're going through this now at work. Contractors getting the work and paying low wages and no health care. But why supply health care when they get it for free from the government which our Social Security payments pay for? And with a president like obama trying to equalize everyone as well as make everyone dependent on government to keep getting elected so they don't lose their "Social standing". This country is bust.
I have always said that the baby boomers were NOT responsible for the shorfall in SS. They may be a larger generation, but they have paid in according to their numbers, and have for the most part paid a larger percentage of their income than did their parents. So it is incorrect for the blame to be put on the baby boomer generation. Another problem is that the fed govt has "borrowed" the money to pay other bills and it is gone. I am tired of the shortfall being blamed on one generation.
First off, since when did the Social Security TAXES we paid in, expecting to get it back, PLUS INTEREST when we retire, become an entitlement???? We don't want something for nothing, we just want what we have OWED to us. The root cause of the demise of the SS program is misappropriation of funds. Maybe all US Citizens that have paid into the system need to find a real good attorney and file a class action suit against Uncle Sam??? Any takers???
Also, for those who don't know the history of the SS system, this was supposed to be a TEMPORARY fix. Do some online research and find out a little more about it and what has gone wrong. Don't rely on mainstream media to get accurate and reliable information. You may actually have to go to a library and read about it, some good ole pre-computer technology. Remember books??
The top 400 wage earners earned 81 billion in 2009
They paid over 16 billion in taxes.
amost 50 percent of the US population earned over trillion dollars
and paid 19 billion in taxes. Just never enough for the Libs!
I view your article as being grossly skewed in favor of continued federal management of social security contributions, and we all see how well that has been working out. Social Security is flat out broke. Every penny I've paid into the system has already been paid out to someone else. All I have is an I.O.U. from the federal government. And what's even worse, if I die before even collecting my first check, my heirs get ZERO after all the life long contributions I've made, ZERO!!!
Give us the option of participating in your ponzi social security scheme, or allowing us to self direct our retirement funds.
take the cap off social security and make the rich pay the same percentage as the working family and change the rules to allow people to qualify for benefits when they have paid in the system for forty years and not forty quarters and there will be no shortfall of money. stop playing games with the working families retirement.
Rich people deserve tax breaks! For Christs sake, I'm sure as hell not rich, but I understand this. How many people have gotten a job from a poor person? If I'm rich, and I want to start a business that would create 1,500 jobs, and all of a sudden, the federal government says I need to pay twice as much in taxes or more than I already am, then you're damn right I am going to ship all those jobs off to China and Mexico, because it is cheaper!
How are people this stupid to think that rich people who are smart enough to read through the tax code and find these little short-cuts, and create a business from scratch, wont say screw you to the American public when they tell them that we want all their money to go to taxes. Kind of takes away the point of owning a business and creating jobs, doesn't it?
Then the most fun part of this little farce comes to bear; now that the rich people have left America for greener pastures, all those middle class and poor people that were pissing and moaning about taxes and how hard they have it, are screwed again because they get laid off so the business can relocate to Asia. Of course, stupid people being stupid people, they will probably just piss and moan that "they took our jobs!" and want the government to do something about that too.
Bravo! Finally, someone with some sense talking about facts has weighed in. The rich have gotten so many breaks the rest of us do not get. Its about time someone started talking about it.
Barak has talked many times about the war on the middle class. This is just one of the many things he's been talking about.
Get the facts correct!!!!!!! Military widows and children are paid from an military insurance policy known as “the military survivor benefit plan SBP”. And it is paid for with payroll deductions from the military paycheck. This plan is not even slighty affiliated with the SSI program.
Now add the great number of people who died before they could collect the SSI they paid in and add the 11 Million illegal immigrants who pay SSI but cant collect it. This article is diversionary propaganda from the facts that our congressmen have been siphoned it off for other projects over the last 50 years.
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