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Robert J. Samuelson: Washington can't ignore Social Security reform

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  • Mike in Cedar City Cedar City, Utah
    Dec. 6, 2012 9:40 a.m.

    dwaynerichards. That's some pretty good rationalizing you are doing. If a person takes a benefit that he or she has disparged in the past, reqardless of meeting the legal requirments for obatining it, it is hypocracy in my view. But let's just agree to disagree. The right wing just hates anything that is done by Goverment, especially the Federal Govermment, because they think that our democratic constitutional goverment is somehow inherently evil. They view so called entitlement programs as creating government dependancy, the "makers and the takeer" the 47%. And, with this philosophy they ignorantly fall for the taking points of wealthy oligarchs who want to run this country with their money.

  • VIDAR Murray, UT
    Dec. 5, 2012 9:53 a.m.

    Twin Lights
    Louisville, KY
    The problem with the “we are all in this together” concept is that in many cases we are taking money from young workers, with children, living in apartments.
    And giving the money to millionaire seniors; living out of the country in their bungalows.
    Social security appears to be run by Curmudgeon hood; you know robin’s older brother; curmudgeon hood steals from the poor young worker; and gives to the rich retired elderly.
    Social security should only go to those who are in financial need.
    Rich seniors who want social security; should first pay their portion of the national debt first: $90,000 each, then we can talk about it.

  • VIDAR Murray, UT
    Dec. 5, 2012 9:32 a.m.

    dwaynerichards
    Provo, UT

    I think the point is that most elderly will not be around when social security goes belly up. To me they seem to have an attitude of I am going to get mine; regardless the effect is has on younger workers.
    We already are burdened by the trillions dollars of debt your generation has passed onto us.
    Why should anyone under the age of 50 support social security? We are simply paying into a program that already is bankrupt. At this point we continue it by social security taxes; and selling T-bills to the Chinese.
    What if the Chinese decide one day to cash in their bonds?
    Right now entitlements take up over ½ the federal budget. It is projected that in the next 30 years they will be over ¾ the federal budget.
    Social security and Medicare are programs that simply cannot be sustained at current levels.
    Maybe if we limit payments to those who truly need it; we can get a few more years out of it.

  • Twin Lights Louisville, KY
    Dec. 4, 2012 10:11 p.m.

    SG in SLC,

    I have no problem with your position on the salary cap. That (or something very much like it) is likely key to any solution.

    You already have my position on the means testing of benefits so I will not repeat it.

    BTW, you are incorrect about Eric. He wrote a play about economics. That takes him forever out of the sensible guy category. Sorry Eric.

  • dwaynerichards Provo, UT
    Dec. 4, 2012 6:40 p.m.

    Mike in Cedar City,

    "I would like to be around when JCS becomes eligible to see if he will be hypocritical and take the benefit."

    I'm tired of how misused the term "hypocrisy" has become. Hypocrisy isn't advocating or attempting to live according to your opinions instead its doing or saying the opposite of what you actually feel or believe therefore it's not hypocritical for a person who believes social security is a scam to receive it if they also believe it's money they have a right to get back. Hypocrisy in this sense would be if they claim it's wrong to receive benefits yet do so privately or if they claim to believe it is wrong to receive such benefits when they really believe it's okay.

    There may be people who claim that receiving social security is wrong and if they do and then receive it themselves they could be classed as hypocrites but it's not hypocritical to receive it if you don't believe it's wrong to receive what was taken from you. You may not agree with their opinions but those who hold it aren't being hypocritical.

  • SG in SLC Salt Lake City, UT
    Dec. 4, 2012 2:43 p.m.

    @Eric Samuelsen & Twin Lights

    I'm (obviously) not Twin Lights, but YOU both strike ME as sensible guys, so I thought I would weigh in, FWIW.

    I like TL's reasoning and proposal, but I would also suggest another means testing-based option for consideration. I think that any Social Security reform (and honestly, any deficit reduction via spending cuts and "revenue enhancement") needs to be phased in over a period of time to reduce the pain to those affected, and to give them the opportunity to act on their own behalf, if possible, to mitigate the effects on them.

    I would raise the salary cap on the Social Security portion of FICA (currently $110,600) to $350,000. I would phase this in over three years (year1 - $200K, year2 - $275K, year3 - $350K). I would also use a means test to reduce, but not totally eliminate, the Social Security retirement benefit for individuals with AGI greater than $350,000. The benefit for individuals with AGI greater than $350,000 would be 40% of the full benefit, and again, I would phase this in over three years (year1 - 80% benefit, year2 - 60% benefit, year3 - 40% benefit).

  • Twin Lights Louisville, KY
    Dec. 4, 2012 1:17 p.m.

    Eric,

    I am not sure everyone would agree with your assessment of me but thank you.

    Part of the problem with means testing is the loss of the "we are all in this together" concept. Under current rules, everyone plays and everyone benefits to at least some degree. Soc. Sec. has been treated like ordinary tax by the Treasury (see prior post) but most Americans are willing to pay it because they see it differently. Means testing destroys that connection.

    This is not to say it should not be a part of the solution, but I think it can only be a small part. Rather than exempt the high income earners, I would lower payments to all and then means test and supplement the lowest beneficiaries under a program with another name. Not Welfare but not Soc. Sec. either. And I think we need Soc. Sec. to be administered by an appointed agency/council that does not directly answer to Congress (5 year appointments by the Pres. and approved by the Senate with one possible second term if asked). Some how you have to get this out of the hands of Treasury because Congress controls its spending.

  • Tekakaromatagi Dammam, Saudi Arabia
    Dec. 4, 2012 12:46 p.m.

    @Gildas:

    "We do not have an effective lobby for the rights and entrusted funds provided by seniors and neither party does anything positive to assure that the seniors are not made to suffer from the malfeasance of Congress."

    Actually, we do. The AARP. One of the top two lobbying groups in the US. The AARP and AIPAC.

    The AARP has been very effective. That is why entitlements to the elderly are such a big part of the federal budget. It is just at this point, the chickens are coming home to roost for how we've squandered social security in the last 30 years.

  • Screwdriver Casa Grande, AZ
    Dec. 4, 2012 12:40 p.m.

    Sure, CUT CURRENT social security recipients by $200 a month and make sure they know it was republicans that pushed for it.

    I'm tired of hearing 80 year old conservatives living completely on the government complain about Obama. They pay $100 a month for a medicaid supplement and actually think they have private insurance! "I don't want government healthcare!" they say. Uuuuugh! Charlie Brown.

    I'm all for a fact test before anyone receives anything from the government.

  • Tekakaromatagi Dammam, Saudi Arabia
    Dec. 4, 2012 12:40 p.m.

    @Mike in Cedar City:
    "Unless you believe that the "full faith and credit" of the United States is of no value, Social Security is solvent and will be so for many years."

    Me! Me! Me! I do not believe that the full faith and credit of the United States is of value enough that they will pay back social security. I would be against it anyway, because if they did they would crush everyone still working with oppressing taxes.

    It is a Ponzi scheme, that was obvious 30 years ago. The only reason this one is legal is because congress made it legal in this one case to do it.

    Here is a little exercise you can go through, call the social security administration and ask them how much money is in your fund. Go ahead. There isn't any money in it. The Republicans tried to keep money in your personal fund. That is the thing they have been calling about privatizing part of the social security. But the Dems would always demagogue them over it so it never happened.

  • Eric Samuelsen Provo, UT
    Dec. 4, 2012 11:48 a.m.

    Twin Lights,
    You strike me as a sensible guy. What do you think of means testing? I can see reasonable arguments both ways.

  • Screwdriver Casa Grande, AZ
    Dec. 4, 2012 11:46 a.m.

    Social Security is the only government program running a surplus for decades - leave it alone.

  • one old man Ogden, UT
    Dec. 4, 2012 10:39 a.m.

    Yes, Black Knight, what you say is mostly true. The problem is that too many who revere St. Ronald tend to try to ascribe full credit to his efforts. In truth, what he did merely supported what others were doing. He did not, by any stretch of the imagination, provide leadership beyond some well chosen words in a few dramatic speeches.

  • KDave Moab, UT
    Dec. 4, 2012 9:55 a.m.

    So Social Security recipients are supposed to accept a cut to their $ 12,000 or so a year, Whilst Govt pensions approach $100,000 per year. A pretty hard sell to make. What about that "fairness" thing? By the way it was LBJ that first raided S.S. to mask the cost of his Vietnam War.

  • Henderson Orem, UT
    Dec. 4, 2012 9:37 a.m.

    It's so easy to see the warfare being waged by the radical right against Social Security. They don't want to fix it. They just want to either privatize it (which will eliminate it) or eliminate it completely.

    Incredible!

    And they wonder why they keep losing elections?

  • Black Knight American Fork, UT
    Dec. 4, 2012 9:36 a.m.

    one old man:

    In the case of the Soviet Union, overspending on their military definitely contributed to that nation's demise. It could not keep up with US and NATO military technology and thus spent itself into oblivion trying to keep up.

    While the pope and Lech Walesa both contributed to the decline of the former Soviet bloc, never forget the huge roles played by President Ronald Reagan and Prime Minister Margaret Thatcher in this endeavor. Having spent a considerable amount of time in Poland, the Czech Republic, and Hungary (as a professor of European History), I observed the very high regard the Poles, Czechs, and Magyars have for Reagan and Thatcher. This is evident by the fact that many towns and cities in these three countries have streets, parks, and squares named for Reagan and Thatcher.

  • one old man Ogden, UT
    Dec. 4, 2012 9:03 a.m.

    JCS, where did you study history?

    Japan, Nazi Germany, Soviet Union done in by overspending? The first two were done in by brave and dedicated soldiers of many nations. And, in the case of Japan, by two big mushroom clouds. The Soviets were polished off by a Polish Pope and some very courageous Labor Union workers east of the Iron Curtain.

    And who first raided Social Security? Not Democrats. Unless Ronald and Newt were Dems in disguise.

  • Gildas LOGAN, UT
    Dec. 4, 2012 8:36 a.m.

    The same old lies and distortions, Mr Samuelson. Your Democrats as well as the Republicans have spent Social Security contributions and collaborated to radically decrease funding.

    We do not have an effective lobby for the rights and entrusted funds provided by seniors and neither party does anything positive to assure that the seniors are not made to suffer from the malfeasance of Congress. Additionally there is a virtual conspiracy of silence in Congress and the Presidency, and a complete failure to discuss the issue responsibly or take blame. Like everything else politicians twist and spin for their own benefit and care nothing for any of the people save their political allies and funders.

    The Utah delegation has had little or nothing to say to the point, except Mike Lee who supported a common sense formula to save Social Security from politicians, though we hear little about that.

  • Truthseeker SLO, CA
    Dec. 4, 2012 8:30 a.m.

    So did Congress spend our Social Security taxes? Of course

    They spent this money on all the various operations of the federal government, with a large chunk going to pay for Social Security benefits, Medicare and the military.

    When you buy any investment, like a stock or a bond, the entity that issues it usually spends the money you paid for that stock or bond. When you buy a corporate bond, for instance, the issuing corporation spends the money on equipment, advertising, computers, salaries and any aspect of the business that needs money

    If the Social Security trust fund invested in something other than U.S. bonds, what would it invest in and where would the money go? If it invested in corporate stocks or bonds, the money would get spent, as noted above. If it invested in the bonds of state and local governments, the money would also get spent. And if the government owned too large a slice of U.S. corporations' stocks and bonds, you might call it socialism.

    Where we we be now, if, instead of tax cuts, Bush had paid down the debt, invested in Medicare or Social Security?

  • Mike in Cedar City Cedar City, Utah
    Dec. 4, 2012 8:08 a.m.

    Unless you believe that the "full faith and credit" of the United States is of no value, Social Security is solvent and will be so for many years. The truth is that right wingers really don't want to secure the program for the long term. They either want to privatize it or wipe it out all together. As JCS says, they think its a "scam". I would like to be around when JCS becomes eligible to see if he will be hypocritical and take the benefit.

    It's not s scam, its not a pyramid scheme, and it does not add one dollar to the deficit. Some adjustments need to be made for the long term, and the laws might be changed to require the federal government to maintain an invested reserve in highly secure private funds, but its fundamental nature as essentially a prepaid annuity with the U.S. government as the administrator should not be changed. If it gets changed or eliminated JCS, and sadly most of the the next generation of retirees, will find themselves in the County poor house just like it used to be before Social Security.

  • Tekakaromatagi Dammam, Saudi Arabia
    Dec. 4, 2012 7:03 a.m.

    People who say that the 47% don't pay income taxes are mistaken. They do, they pay into social security for working. The money is not going into a personal social security account. It is being transferred to the regular government revenues so that the deficit looks smaller. In a sense, the US congress has approved 'raiding a pension fund' like a corporate raider. This is the status quo that the Democrats are defending.

  • Twin Lights Louisville, KY
    Dec. 4, 2012 5:39 a.m.

    I agree with Mr. Samuelson that Democrats must give if they expect Republicans to give. That is the nature of compromise.

    While I understand that he is trying to whip Democrats into fully joining the fray, his article implies that our current situation is mostly the fault of Democrats. It is not.

    The grand bargain cut in 1983 was between Ronald Reagan and Tip O’Neil. In the following years, Social Security would generate surpluses that should have been put in a sovereign wealth fund for investment. Instead, the funds were simply put in the Treasury and either spent on programs or given back in the form of tax cuts. Yes Treasury issued notes to Soc. Sec. acknowledging they owned Soc. Sec. the money but that is just spending the money in our pocket, replacing it with a handwritten IOU (to ourselves), and then saying we still have the money. We have been cheating ourselves at a game of solitaire.

    Now comes the piper for payment. Who stole the funds? Everyone.

    John Charity Spring,

    If my history serves, the Nazis, and Imperial Japan were not undone by excessive spending but by something called WWII.

  • John Charity Spring Back Home in Davis County, UT
    Dec. 3, 2012 9:28 p.m.

    Like all entitlement programs, Social Security is a lef-wing scam that must be abolished. It is based on false principles, and is specifically designed to buy votes from the gullible public.

    The left likes to claim that Social Security is merely returning money to wage earners that they already earned. This is nonsense. The money the wage earners paid to the government is long gone--spent on other wasteful projects. In addition, false formulas mean that retirees will now be paid up to seven times the amount that they contributed, even when inflation is taken into account.

    The government cannot continue to pay out far more than it takes in. The Soviets, the Nazis, and Imperial Japan all tried this, and it resuted in their utter destruction. We should not expect anything different if we follow the same course. We must return to the original expectation that all men must work for their bread, and if they will not work, they will not eat!