It's kind of gotten lost in all the kerfuffle over the empty-headed Miss California and her wardrobe malfunctions, but that perpetual target of the right wing is back: Social Security. The latest set of estimates indicates the trust fund will be exhausted a couple years earlier than anticipated, so naturally the talking heads who read the news are busy trying to gin up some hysteria. All the usual bits of misinformation are being repeated ad nauseum, the primary one being that "OMG Social Security will be depleted in [insert year here]!!!"
Bizarre. They may read whatever is shoved in front of them but Wolf Blitzer et al apparently have the comprehension levels of a first-grader. Social Security will not be depleted in 2000-whenever (anywhere from 2037 to 2045, depending on the projections being used); that's the possible year the trust fund zeroes out and the system has to rely solely on contributions being made to the system by workers. And that's assuming absolutely no fixes to the existing system are made, such as removing the earnings cap on taxing wages or upping the age at which a person would qualify for full benefits -- I've never heard a suggestion about upping the age when we all can start collecting partial benefits, which is 62.
When I was listening to the news CNN had a clip of President Obama suggesting the first -- removing the earnings cap -- but of course Wolf et al totally ignored that particular sound bite and instead blathered on breathlessly about Social Security not being there 40 years from now. The man's an idiot.
Of course, having recently sat through a 2-day pre-retirement workshop during which everything a person could ever possibly want to know about Social Security, federal pensions, and private investments was laid out in excruciating detail, I know that Wolf isn't alone in being an idiot. Most Americans are clueless when it comes to Social Security. I heard some truly strange questions asked by co-workers, and if my co-workers (who I would hope are slightly better read and/or informed than the average American) are clueless, that doesn't give me much hope concerning the rest of the populace.
For a start, it's absolutely astounding how many people still labor under the mistaken belief that Social Security is an investment plan. No, no, no, people, it's old age insurance! The money we all pay into Social Security isn't an investment, like buying a bond or putting money into a 401k, it's an insurance premium to protect us from starving to death if we get too old or too crippled to work. When the system was first proposed, in fact, that's how it was described: Old Age Insurance. And just like every other insurance system, it's based in large part on the assumption that a goodly number of the people paying into the system are never going to have to collect, which is why the retirement age for full benefits is set where it is. Back in the 1930s actuaries looked at death rates and deliberately set the minimum age high enough that the number of people who actually collected would be low enough to make the system sustainable. In 1935 the life expectancy in the U.S. was 61; in 2005 it was 77. And there's the Social Security problem in a nutshell; people are living too long.
I could go on, but I need to get to work.
Bizarre. They may read whatever is shoved in front of them but Wolf Blitzer et al apparently have the comprehension levels of a first-grader. Social Security will not be depleted in 2000-whenever (anywhere from 2037 to 2045, depending on the projections being used); that's the possible year the trust fund zeroes out and the system has to rely solely on contributions being made to the system by workers. And that's assuming absolutely no fixes to the existing system are made, such as removing the earnings cap on taxing wages or upping the age at which a person would qualify for full benefits -- I've never heard a suggestion about upping the age when we all can start collecting partial benefits, which is 62.
When I was listening to the news CNN had a clip of President Obama suggesting the first -- removing the earnings cap -- but of course Wolf et al totally ignored that particular sound bite and instead blathered on breathlessly about Social Security not being there 40 years from now. The man's an idiot.
Of course, having recently sat through a 2-day pre-retirement workshop during which everything a person could ever possibly want to know about Social Security, federal pensions, and private investments was laid out in excruciating detail, I know that Wolf isn't alone in being an idiot. Most Americans are clueless when it comes to Social Security. I heard some truly strange questions asked by co-workers, and if my co-workers (who I would hope are slightly better read and/or informed than the average American) are clueless, that doesn't give me much hope concerning the rest of the populace.
For a start, it's absolutely astounding how many people still labor under the mistaken belief that Social Security is an investment plan. No, no, no, people, it's old age insurance! The money we all pay into Social Security isn't an investment, like buying a bond or putting money into a 401k, it's an insurance premium to protect us from starving to death if we get too old or too crippled to work. When the system was first proposed, in fact, that's how it was described: Old Age Insurance. And just like every other insurance system, it's based in large part on the assumption that a goodly number of the people paying into the system are never going to have to collect, which is why the retirement age for full benefits is set where it is. Back in the 1930s actuaries looked at death rates and deliberately set the minimum age high enough that the number of people who actually collected would be low enough to make the system sustainable. In 1935 the life expectancy in the U.S. was 61; in 2005 it was 77. And there's the Social Security problem in a nutshell; people are living too long.
I could go on, but I need to get to work.
Good points all. But I wonder why you watch the idiot known as Wolf. Only thing I watch on CNN is Anderson Cooper and even he has the nimrod Cheney-loving fool Matalin on there occasionally.
ReplyDeleteIt's on when I get home from work. The S.O. has a Jack Cafferty addiction.
ReplyDeleteI watch MSNBC all day..actually its on in the background. I do pay attention when Countdown and Rachel Maddow are on..but other than that..I just can't stand most 24 hr news channels.
ReplyDeleteIs Cafferty the guy that blasts both lefties and righties?
We don't get MSNBC on our very basic cable, otherwise I'd probably be addicted to Rachel Maddow. Cafferty is indeed the equal opportunity curmudgeon.
ReplyDeleteAs a supplemental old age insurance package at that. It was not to discourage some from still haveing their own retirement plans. It was never meant to be expanded to support the children of deceased either. These features were added much later.
ReplyDeleteWhen my sister-in-law died at 26 years of age - she had been in the work force only 4 years. Her husband made $100K+/year - and then he started drawing SS for the 2 children (age 3 and 1). He received a starting amount of over $500 for each child. That was a case of "no need." I don't have all the answers but that was an abuse.
The example of the mother dying young and the kids not really needing the money doesn't strike me as an abuse of the system. It was luck the surviving parent had a good income. What strikes me as abuse are the parents who push real hard to get their kids labeled as autistic or learning disabled so they can get them on to SSI (disability). But that's a subject for a different rant.
ReplyDeleteYou can always catch the show via video on her webpage on MSNBC..and it is highly worth it! I AM addicted to her show..she is friggin awesome!
ReplyDeletehttp://www.msnbc.msn.com/id/26315908/
I worry about a lot of things, but losing my SS money isn't one of them. I'm pretty sure that it won't go away unless this government completely fails.
ReplyDeleteAnd being as it's my only income and I get by just great on it because I have few wants and needs I could figure out how to get by if it does go away.
It's not like I won't be on the same boat with many others, just with many more skills than others have is all.
They may be in big trouble, but I won't be.
The money we all pay into Social Security isn't an investment, like buying a bond or putting money into a 401k, it's an insurance premium to protect us from starving to death if we get too old or too crippled to work.I'm no SS expert by far.
ReplyDeleteAs I understand it, the Gov't is continually taking real dollars from the plan, and replacing them with I.O.U's. As with any insurance, when you don't pay the premiums.....
Then the fear mongers (often the very people that stole from the account) look at what cash is left, look at the amount being paid out, add some spin and lies, and give their doom and gloom estimates.
It's interesting [sic] that this happens after every election. The party not in power of course, says the sky is falling.
They're not IOUs -- the trust fund has been invested in U.S. treasury notes and bonds. I'm always baffled by the way politicians can in one breath tell the citizenry to "buy savings bonds because they're the safest investment on the planet" and then in the next claim that Social Security's investments are "just IOUs."
ReplyDeleteAnd all insurance plans spend the money that's coming in as it comes in -- they don't just stick the premiums people pay into a giant mattress somewhere; they take the premiums and invest it in stocks, bonds, etc. The big difference between companies that tank from doing that (like AIG, which invested in worthless derivatives) and Social Security is SS invests strictly in US government securities.