Franklin D. Roosevelt was visionary in the establishment of Social Security.
Roosevelt was determined that the devastation and poverty he witnessed during The Great Depression would never befall hard-working Americans again. The Social Security Act was enacted to allow aging Americans to retire comfortably and with dignity. As he stated in his proposal to Congress in January of 1935, “It is a sound idea–a sound ideal.”
The program has worked well since its ratification in 1935 when a small amount of a worker’s pay was held out of each paycheck and saved for the individual until they retired from the workforce.
Social Security is ‘not’ an entitlement—it’s our money, our savings, that ‘we the people’ allow the government to protect for our future.
Defined broadly one could argue that Social Security is an entitlement—under both definitions of the word. But the usage by the Republicans has made the word dirty, its association with Social Security obscene. Listening to Ryan, Cantor, and Boehner’s negative references is offensive.
‘The people’ need to take back the argument from those that try to distort it.
Social Security is not, as Republicans portray it, a gift from them or any other politician, past or present. It is not a gift from the Federal Government. It is, and was always, a retirement savings plan—despite the argument by some to the contrary.
The discourse must change in order to properly address the Social Security conflict. Government ‘promise’ needs to be replaced with the word ‘obligation’ which would better define the 76 year old program. Social Security is a government backed ‘savings plan’ and the government is obligated to return it under the implied terms of the plan—the spirit of its intent. Recent polls show that clearly the American people like Social Security.
It is true that Social Security is faced with some future problems as a result of Congressional mismanagement, lack of vision, and stealth. Adjustments will be necessary to sustain the program for future generations. But, for now, the program is still viable and generating yearly surpluses—$134 billion in 2009.
Fuzzy math arguments and fear inducing generalizations, such as those used in The Roadmap for America’s Future, are disingenuous.
Representative Paul Ryan’s Roadmap is a veiled attempt to privatize Social Security—smoke and mirrors to return us to the greedy failure of the 1920’s.
You cannot, as Representative Ryan has done, support the cut in payroll taxes, and the recent income tax breaks for the wealthy, yet argue the unsustainability of Social Security. It’s utter hypocrisy, as is claiming that Social Security adds to the deficit.
When Social Security could benefit from simplification, Ryan’s program introduces overly complicated deviations destined for failure. The Roadmap is a sham and its author a charlatan.
There are so many holes, misrepresentations, and omissions in Ryan’s plan it is difficult to address them all. His failure to acknowledge supplemental programs—401k’s and IRA’s—and the risks they’ve encountered, is deceptive and requires extensive discussion, exposure, and possible restructuring.
His plan methodically erodes the current safety of the program, creating a government guaranteed bailout for private sector firms that will benefit from the spin-off’s, shifting the burden to the taxpayers if it should fail—privatizing the profits and socializing the losses is exactly what happened with the big banks.
These privatized accounts will be administered by the same people that caused the financial crisis. Ryan’s promise of security is anything but.
Social Security currently takes 7.65% from the employee’s paycheck and an equal amount is paid by the employer, a total of 15.3%. Of that, 12.4% goes to Social Security and 2.9% to Medicare. In 2009 nearly $600 billion went into the trust fund for just Social Security. The program has had yearly surpluses of over $100 billion for 11 straight years.
Yearly surpluses are declining, however. With the retirements of the Baby Boomers it will begin to turn negative in 2014. But, the program is not bankrupt! The U.S. Government owed the trust fund $2,336,798,000,000 at the end of 2009 which they will have to begin to repay in 2014.
Social Security is a well managed program with minimal operational expenses, less than 1% of receipts yearly. Private account managers will siphon off considerably more to manage Ryan’s proposed private accounts.
The government already allows private accounts, unmentioned in the Roadmap; tax-deferred retirement plans available to anyone in the country. They, of course, have suffered significantly in the volatility of the stock market.
Ryan falsely refers to Social Security as government spending. To the contrary, it is a fully funded program, paid into by hard-working Americans. Defining the reimbursements as government spending is dishonest and politically charged. In 76 years Social Security has not cost the Federal government a single penny.
There are many questions that need to be answered before any changes can be made to Social Security, and the sooner the better. But it is clear that adopting Representative Ryan’s Roadmap would be a disaster. Nor do we need to enact the recommendations of the Deficit Committee.
There are a few simple solutions that would immediately extend the program.
- First, reverse the 2% payroll tax reduction despite its short-term stimulation to the economy.
- Second, increase the payroll tax in 2012 to 16%; 13% for Social Security. A tax burden of three dollars more for every $1,000 in wages.
- Third, raise the upper limit to $125,000 in 2012, $140,000 in 2013, and $150,000 in 2014.
- Immediately address the years of misuse of surplus funds by this and past Congresses, and every single one should be held accountable.
Any plan to privatize Social Security would be a fatale mistake.
We don’t need a better plan—a modernization similar to the one that crashed the financial system.
We need better people.