Social Security Reform: Three Frames and Three Ranges of Fixes
by Bruce Webb
This may be too wonkish for the Virtual Summit, so let me try it out here.
A lot of crosstalk on Social Security ‘crisis’ is a result of three different definitions of ‘crisis’ which I would sum up as follows:
Crisis one: Social Security promised benefits which may not be payable.
Crisis two: Social Security promised benefits which were not affordable.
Crisis three: Social Security promised benefits which should not have been promised.
Note the changes in tense and mood, changes which constrain the range of acceptable fix. Crisis one is probabalistic (‘may’), it doesn’t necessarily commit to the proposition that those benefits actually can’t be payable, and implicitly assumes that such payments are desireable. Crisis two however is deterministic, in this frame the damage has been done, and implicitly argues that the only question is what to do about it. Crisis three is moralistic, it claims that even the attempt to pay these benefits was a mistake, that the effort was flawed from the beginning.
Taking Crisis three first. From this standpoint, one associated with Rand, Friedman and the Austrians the only real question is how to transition away from Social Security as currently configured and the solutions proposed will tend to gravitate towards such things as private or personal accounts.
On the other hand Crisis two assumes that the damage has been done and its solutions will naturally tend to gravitate towards benefit cuts.
And finally Crisis one will see benefit cuts as the fallback position, given the probabilities maybe necessary but not something to be embraced, and is open to some sort of revenue enhancement.
As to ranges of fixes. A Crisis three person is not necessarily open to any kind of fix whether that fix is proposed on the cost or revenue side, that is just to perpetuate what with Friedman they believe to be an “immoral” system. On the other hand a Crisis two person will reflexively reject any tax based fix on the time honored principle of “Don’t throw good money after bad”. Only if you have a Crisis one mentality does, for example, the Northwest Plan even make sense, because Crisis three people refject the whole idea of a fix and Crisis two people regard the status quo as already broken.
Which is why supporters of traditional Social Security often just miss their marks entirely, they assume naively that their desired end of retirement security through social insurance at the promised level of benefits is simply accepted and that the only question is the method when neither half of that end is necessarily accepted by the opposition. So when people like my friend Dale make an argument in the form of “We have a moral responsibility to support the subsistence of the elderly and the cost of doing that in a way that delivers 100% of the scheduled benefit is cheap” it simply falls on deaf ears, with Crisis three people replying to the former assertion “The hell we do” and Crisis two people asserting that the current cost is already too high.
This is why I get impatient with progressives and to some extent with Dale (who doesn’t consider himself a progressive in that sense), they insensibly assume that their desired end is even shared. “Just lift the payroll tax cap and the problem is fixed!” is not compelling to people who don’t want to fix it that problem in that frame. Their frames will lead them to a totally different range of fixes. Hence the crosstalk.
If a person has a bias and is bigoted, you cannot make that person change his.her bias and bigotry. That is a “so what” sort of analysis. My question is, regardless of where an ideologue falls, what is the correct thing to do given the desires of the electorate? Who cares what a wonk wants? The real thing is to look at what the people want (which is somewhere between Crisis One and not defined).
Bruce,
Not to wonky, actually lays out a large chunk of the problem I’ve seen in AB’s discussions of SS. I haven’t seen many of the Crisis 3 types but lots of Crisis 2 and more of Crisis 1. I’m in the Crisis 0 – there is none, leave SS alone.
But then again I beleive the real problem is Crises 4: We don’t want to actually pay back the SS funds loaned to the general fund. (funds can only flow FROM SS TO the general fund, not the other way).
I think that’s seperate problem than the Crises 3 types. But both 3 & 4 imply that the payroll tax is just another revenue stream to the US Gov., an idea that should be rejected. Crises 1 and 2 explicitely argue that the payroll tax is just another revenue stream and that SS is just another government line-item program that can be cut just like the number of people working at the National Parks or how many guns the IRS buys.
I think the first order of business is get the idea that SS is part of the general fund (“its all one big pot of money”) killed and buried. Deep. Once that happens the rest flows easily.
Good luck.
Islam will change
My response to those espousing numbers 2 and 3 (similar to my response to confederacy nostalgiasts) would generally be “get over it.” SS is here to stay.
Yes, we might pare a bit on benefits (higher retirement age, etc.) if forward-looking issues are compelling (intergenerational fairness, etc.).
But if we accept redistribution through SS as a given (and don’t try to pretend it’s just a pension fund), the question is how to pay for it via taxes (call them payroll, income, whatever).
Dale’s solution does that, while delivering a necessary dose of progressivity to a tax system (local, state, federal combined) that is essentially nonprogressive above about $60 or $80K a year in income.
Steve anyone who doesn’t see that Crisis two mentality is in the ascendent in the policy world frankly is not paying attention. By my count five of six of Obama’s appointees to the Deficit Commission share it as does he Executive Director. The six Republicans all fall in Crisis two or three as does Conrad on the Dem Senate side. Of the remaining five Dems Sen Baucus and Rep Spratt seem to me sympathetic to Crisis two, while Sen Durbin and Rep. Schakowsky are both Illinois allies of Obama and not sure bets to buck the tide. The only two certain Crisis one votes are Andy Stern (who has announced he is stepping down as head of SEIU and so Change to Win and so gave up some clout) and Rep Becerra. Given that the path to 14 out of 18 Yes votes is not hard and both Pelosi and Reid have promised a vote (though not an unamendable up or down vote) on the package.
Pete G Peterson endowed the PGP Foundation with a cool $1 billion and has used that well in shaping opinion in much of the policy world, the days when even hinting that changing Social Security was to grab onto the Third Rail of American Politics are largely done, the Right has sent 27 years draining out the juice.
The President of the United States has an economic staff that is with a couple of exceptions throughly committed to Crisis two thinking. And the one reliable progressive in the group, Jared Bernstein, is to some degree side-lined by being assigned to the Office of the VP. Given that the head of OMB and his Deputy are BOTH the authors of Social Security reform plans, one of them too awful for words, the idea that there is no danger to SS out of an Obama Deficit Commission is absurdly complacent.
Bruce – Just an odd thought.
How does Peterson expect to have any type of ROI on that $1B in the PGP Foundation?
I just don’t see the benefit…
Dear Bruce
let me correct two things
first an inadvertant implication. Dale does not advocate a raise in the cap. Quite the contrary.
second. dale does not say we have a moral resposibility to support the subsistence of the elderly. Dale says only a damn fool would not raise the payroll tax enough to support his own expected longer retirement. but dale also believes the very large number of damn fools in the country need to be protected from themselves, if only to protect the rest of us from the consequences of their damn foolery.
Buff
you are my hero. who’d a thunk it. you couldn’t tell it from Bruce’s post, but I agree with you.
Good post you capture the issue exactly. The Crisis 2 group includes the groups who think governement is to big already, as well as those who think to much is going to OADSI. (We need to recall that SS is much more than the old age pension, there is a disablity and survivors benefit. Both of these are important to those who need them, as important as the Old age is to the pensioner.
Of course this arguement is as old as SS. My grandfather born in the 1890s opposed SS all his life. My mother (1922) thought she would never get anything out of SS (She got benefits until she died) Of course how many forget that that raving socialist Otto Von Bismark invented the state old age pension. (Clearly he was a raving socialist)
Buff I expect it has more to do with pissing on FDRs grave and rolling back the New Deal than ROI.
The billionaires funding the VRWC; Scaife, Koch, Olin etc are not doing because they get a direct return, instead they are protecting their class interests generally or as they sum it up “Capitalism = Freedom”. Many of them have never forgiven ‘class traitor’ FDR.
Not Walter Cronkite
http://www.youtube.com/watch?v=AtyNCD3wzcI “Three of these things belong together.” It apears they are intent on blowing reality away.
Lyle
you give me a chance to address the “dale is not a progressive” grafitti.
i am a progressive in the sense that i think the government needs to take an active interest in the wefare of its citizens. not so much because we are “kind to the poor” as because unaddressed poverty is dangerous to us. That was, I am told, Bismark’s view.
I am not a “progressive” in the sense that many people who stick that label on themselves think that the answer to every question is to tax the rich. In fact tax the rich for the hell of it. I personally think that right now in history the rich do need to pay more taxes. But when that is your solution to everything, you lose credibility.
btw
i don’t know what Bismarks retirement plan looked like or how it was funded. but the American Social Security is funded by the workers themselves, so it hardly counts as “too big government.” The needed “fix”, if we are all going to be living longer, is less than one percent of GDP… and that comes not from taking money away from anyone, but helping workers arrange to safely not spend a little when they are young so they will have enough when they are old.
Bruce Webb: “A lot of crosstalk on Social Security ‘crisis’ is a result of three different definitions of ‘crisis’ which I would sum up as follows:
“Crisis one: Social Security promised benefits which may not be payable.
Crisis two: Social Security promised benefits which were not affordable.
Crisis three: Social Security promised benefits which should not have been promised.”
“Crisis one” makes no sense. If the promised benefits are written into law, they are payable. Only if the law changes is there a possible crisis, as people who have counted on the payments face poverty. That may be a threat.
“Crisis three” is no crisis, either. It is a belief. Those who hold that belief may precipitate a crisis by changing the law.
Only “Crisis two” is a possible crisis. It is conceivable, but not likely, that the richest nation on earth will not be able to afford to make the promised Social Security payments any time within the next 100 years. To prevent that we should revive and harness the Can Do spirit of America to ensure our future prosperity.
Wikipedea says that Bismarks Old age and disablity pension was funded by a tax on workers with some state subsidy. Note that Bismark earlier introduced a health insurance plan for workers 1883 1/3 employeers 2/3 employee. No coverage for dependents just as the first British plan provided cover only for workers.
I would suggest that the fix is in regarding the need to fix Social Security. The media is trumpeting the dire warnings tune for the benefit of public consumption. The political analists, oops! analysts that is, are falling all over themselves to parrot the official line. Peterson and his ilk are only the extreme position, but Social Security will be done in by the conciliators to that extreme. This is not an issue that will be decided on facts. This is a political potato and, therefore, requires a political response in order to put the fix to bed in the grave yard of antisocial ideas.
Write, call, email and cajole your elected representatives. Continue the repeated mental masturbatory activity if you must, but contact those in Congress and let them understand that you and everyone you can influence is going to be attentive to their position on Social Security. Be explicit in noting that you’re not asking advice. You have to state your position with certainty and you have to point your electoral fingers in their faces. “I will not vote for anyone who doesn’t speak out against the attempt to tinker with the one last retirement system that working people have available to them.” You don’t want it fixed. You want it enhanced and protected from unwarranted intrusion.
Min rational Crisis One people may conclude that a future economy may not be able to sustain benefits at the precise level they have been promised. In fact Crisis one people came to EXACTLY that conclusion in 1983. Instead workers agreed or more precisely had agreed on their behalf by Congress that they needed to accept a package of give backs in the form of increased retirement age, tax on benefits for certain retirees, and an increase in FICA.
In point of fact benefits written into then current law were judged to be unpayable and so the law was changed. You have reversed causality here.
I’ll be damned. We agree on something.
I don’t think there will be any problem getting rid of the Unified Budget. In a few years, it will start running a consistent deficit as boomers retire and OASDI goes into deficit until they get around to dying. I expect that the Unified budget will disappear shortly thereafter and we will go back to the separate budgets of the pre-LBJ era. One thing our political parties agree on. Cosmetics are more important than substance.
Even in a sane world, a small, Reagan era type adjustment in retirement age and/or FICA tax rate will likely be required someday in order to compensate for inctreased lifespans. It won’t be a big deal although it will seem like a big deal.
We really ought to sever Medicare from OASDI when discussing “Social Security”. Very different problems.
No, I have not reversed causality. If you had said that there might be a political crisis because people have come to believe that the promised benefits will not be able to be paid, that would have been different. 🙂
As events have shown, the political crisis in the early 1980s was bogus. Even with the current financial crisis, we have had a prolonged period of prosperity since then, so that what was promised then could have been paid. The law did not need to change.
Bruce and Y’all–Bruce, your analysis is correct. Buff’s observation adds quite a bit to the picture and I tend to agree with him. Based on the observable inability of Congress to write good law, I’d like to see them leave it alone. But, thanks to Bruce and Dale, we already know that if the “FIX IT!” bunch prevail, there is a way to do so at minimal expense and disruption to the workforce. What I am seeing here is a political problem, not an intellectual one.
Jack hits it right on the nose. Look, guys, I am here to tell you that the regular old “middle class” people I used to work for every day need Social Security. Badly. They are just about one paycheck and one trip to the ATM from flat busted broke. Even upper middle class professional people are, as we now so quaintly say, “leveraged” up the kazoo. I took a claim on the phone once from a guy who had been a millionaire building contractor. While inspecting a commercial building site one day, he fell through a hole in the second floor of the structure. Result: from millionaire to impoverished quadraplegic instantly. In East LA, walking down the street in your own neighborhood can put you in a wheelchair any day in the week. And, of course, unemployment resulting from chronic illness is just around the corner.
Most of the gloom and doom sayers act as if the US economy has flatlined and will stay so forever. We can’t pay back the SS Trust Fund in the face of this grim future. We can’t afford to develop new industrial capacity, create new jobs, educate the populace, invest in new technology–nope, none of that stuff. We’re just gonna sit here and let the whole country stagnate because otherwise, Pete Peterson’s billion bucks will have been spent for nothing. So, we have to treat our citizens as if they were paupers with their hands out. Because, well, God forbid they should ever want to stop working and they want their Social Security as advertised with no changes made. Hey, we’d like to honor our obligations to the TF, but we can’t afford to pay our own citizens what we owe them! Hasn’t it occured to the crisis mongers that it might make a poor impression on Sovreign fund managers holding Treasuries if we default on our own citizens? Maybe there is something worse than raising taxes after all.
The solution is political. The last time the Peterson crowd got the attention of a President, the resulting effort to privatize or greatly reduce SS failed. At this point, Progressives are in the best position to combat what I can only see as a threat to our economic system. In the old days, Progressives didn’t have much of a chance to get national attention. But, that is no longer the case. Maybe it’s a little early to give up on Social Security. Just maybe. Nancy Ortiz
Codger
I agree, but even talking about raising the retirement age today is dangerous because there are highly placed people who think it is the “obvious” solution. People are tired, and angry, hearing from me why it is not obvious, in fact criminal. But i agree that some time in the future IF it turns out that people want to work longer (because they are healthy longer and have jobs, that they don’t hate, a rise in the age of retirement might make sense. but until we actually experience that golden future, we ought not to consign our children to a living hell in order to save a few dollars of their own money.
Min
i agree with you. I think Bruce is thinking about the “experts”. Those of us who are not experts know, first of all that Social Security is our money, and second that we can afford to pay for the benefits we will need. The experts can’t seem to get their minds around that. Because the money is collected as a “tax” they think that it’s “the government’s money,” and therefore it is either an unsustainable burden on the budget OR taxes should be raised on the rich to pay for it. The first position is nonsense. The second is just stupid…. it would make the first position “true.” I can’t even talk about the people who think the retirement age ought to be raised. I get too angry.
So how many of you have taken the following two easy steps?
1) Written to your two Senators and Congress representative stating your position on the Social Security issue. Your not asking their advice. You’re not asking them anything. You’re telling them that if they don’t begin speaking up now firmly in defense of preserving Social Security as we know it and want it to stay, then you are certainly not voting for them. And that you are letting every friend, neighbor and relative know what the truth of the matter is.
2) Writing to all of those friends, acquaintences and relatives telling them just what it is that you know to be the facts about Social Security. Telling them how important it is that they also write their two Senators and Congress representative. Include a template of the letter they should be sending. Make it as easy as possible for them to forward that message to their elected officials.
There needs to be a serious and significant ground swell of opinion tinged with outrage concerning the need to stop the tampering with a program that works and supports the vast majority of the working population. It isn’t just an entitlement. It’s the law and its one of the onlt fiscally responsible activities our government is engaged in.
Min Social Security was within weeks of total insolvency in 1983 meaning that at a minimum checks would have been delayed. As it was it took an elaborate scheme of borrowing first from DI to OAS and from HI, borrowing that didn’t get unwound until 1986. After that it took ten years WITH the new phased in rate increases to get the Trust Fund back up to its mandated minimum of 1 year of reserves. http://www.ssa.gov/OACT/TR/2009/VI_cyoper_history.html#159726
Your assertions are simply not supported by the historical record. If the law hadn’t have been changed Social Security would have gone into short term default. And even after the change the actual dollar amounts of the surplus started shrinking after 1990 only to recover with the mid-nineties recovery. Check the numbers for yourself.
My Site
the numbers are not the whole story. the payroll tax could have been raised enough in a day to cover the current benefits. the Trust Fund does not have to be maintained at 1 year. A trust fund of one year would be enough to fund Social Security through ten years of a depression like the one we are in.
what min is talking about, i hope, is that if the workers had known the financial situation they would have cheered as the payroll tax was raised. as it was, it was raised “more than needed” to cover current outlays. taking ten years to build up 1 years reserves suggests to me that the payroll tax was raised about 10 percent higher than it needed to be. probably more than that, since we now have over three years in reserve. unless you are saying that the 1983 commission couldn’t do arithmetic and just overshot with never a thought about the baby boom.
Jack
I dogged my senator until he had to pretend to listen to me. i recommend it as an exercise in democracy. We’ll have to see how the Tea Partiers do. My guess is that they won’t get what they want either.
Jack–I stick to my local Blue Dog. He’s one of two AA Dems in the GA House of Reps. delegation. Socially very liberal, if you can believe it. I call every Friday and schmooze the aide on duty up the street here. (I am more impressive on the phone. In real life, I’m just a little old lady.) Otherwise, Saxby and Johnny don’t want to hear from “Democrat radicals” like me. Really, really not kidding about that. This is GA. I know my place. 🙂 Nancy O
I propose a fourth category. Crisis Four: People without a clue.
This consists of 90% of the population who genuinely don’t know nothing, and ain’t heard nothin.
Another 9.9% who have heard all the lies and believe them. Half of those people want to cut Social Security. The other half want to “save” Social Security by “Doing Something.” Like raising the retirement age. This, of course, is cutting Social Security by another name. The unkindest cut of all. Or they want to “tax the rich” to pay for it. This is cutting Social Security by turning it into Welfare As We Knew It.
It probably needs to be pointed out that the latter group are NOT in favor of Social Security even though they tell themselves they are… after all they are good liberals… but not to the extent of paying any of their own money. even if they get it back. Because they are at heart good little Petersons. They know they can do better on the stock market. After that the rationalizataions come easy.
So that leaves one tenth of one percent. Who are they? Can we have a show of hands?
Darn.
Did I mention the “cost” of Saving Social Security as a guarantee that workers will be able to retire at a reasonable age with enough to live on would be one tenth of a percent of wages from time to time as and if needed? An amount that looks like it will average about twenty cents per week per year while average wages are going up ten dollars per week per year.
Of course if you are a good liberal and at the high end of the pay scale, your one tenth of one percent will be a bit more. And over the years will add up to real money, which you could invest on the market and get even more money. So you think, lets compromise. We can raise the retirement age half of whatever they say, and raise the taxes of the really rich to pay for the rest.
Why would the servants want to retire anyway? Why don’t they just invest in the markets like real people? Sure there are bad years from time to time, but over a forty year window, the market always comes out ahead.
Friend Coberly–In forty years, the market will go up and down any number of times. Where I am when it does is critical. In the aggregate, returns may be great. But my particular stock choices may go down without a trace right out of the gate, wipe me out, and send me running to a Roth IRA with nothing but money markets in it.
We now know that the quant people have rigged the roulette wheel in Monte Carlo and it really doesn’t matter how well we choose equities. They’re going to wipe us out. I am having a very hard time understanding why this is regarded as just the way the market works. To me, uninformed as I am, it’s stealing. In this context, what’s the problem with Social Security retirement benefits. Is it just too good for the likes of regular people? Too secure?
Maybe you wouldn’t feel that way if you have to retire when the market is down for your particular stock choices. There is much in life that is not subject to our individual control. It’s important. And that is something we should consider here. Nancy Ortiz
Nancy
my point exactly. and i hope i didn’t leave too many people confused by talking in the voice of my friends the stock market touts. the point is that if you have a million dollars you can weather a downturn and come out fine, but if you are down to your last ten bucks, you can’t. it’s about as simple as that. but i am sorry to say some people, even here, can’t understand that that’s the point.
And now that it’s a quarter to three
i didn’t really like having my name taken in vain.
I don’t fail to recognize that Type 2 and Type 3 errors have different goals than I have. I disagree with them. That is very different from “insensibly assume that their desired ends are even shared.”
The type 3 folks I regard as obviously evil. The type 2 folks are somewhere between being unable to do arithmetic and lying to themselves about their reasons.
But no, Bruce, I am not stumbling around here in a pollyannish haze pleading ‘can’t we all just get along,’ confused and mystified by our failture to communicate.
@My Site:
“Crisis one: Social Security promised benefits which may not be payable.”
That assumes that the United States will not pay its obligations to its own citizens. Get real!
“I stick to my local Blue Dog. He’s one of two AA Dems in the GA House of Reps. delegation. Socially very liberal, if you can believe it.”
The combination of social liberalism and fiscal conservatism in the Democratic Party goes back at least as far as Andrew Jackson. In the spirit of Jackson, Clinton wanted to pay off the national debt.
Seriously? Come on, there is only, and always has been only, one problem.
The wealthy and the corporate, alhtough taking huge assests out of our economy, do not return their fair sahre into our economy.
If the wealthy alone, not to mention the corporate, paid on 100 percent of their income, into social security and medi care, as the rest of us do, where would the problem be then?
Min
you don’t know Uncle Sam.
Coberly: “I dogged my senator until he had to pretend to listen to me.”
Be sure to repeatedly emphasize that your vote and the votes of every ear that you can chew on are against that Senator, the other Senator and the House Representative. They don’t have an iota of concern for your opinions. it is only your votes that count. “I vote. My friends vote and I influence their votes. We won’t vote for you if you don’t represent our interest in Social Security as it is, not as you think it should be.”
Nancy: “Jack–I stick to my local Blue Dog. He’s one of two AA Dems in the GA House of Reps.”
Nancy, That’s fine as far as it goes, but it doesn’t go all the way to DC where the action is on Social Security. See my reply to Coberly, just above. Senators and House of Reps. they don’t get your vote unless they get your point and talk the talk as well as walk the walk. Meaning that Your Senators and House representative have to get the right point and begin speaking out loud in defense of Social Security as it is, and not as they think it should be. It doesn’t need fixing. They need to know that that’s what you know and that you vote. And that you intend to talk and talk ’til every individual voter that you know will share your opinion about Senators and House reps that don’t agree.
Thomaso
the problem then would be that Social Security would be welfare. that would be bad.
the whole point of Social Security is that workers pay for their own benefits. The advantage to workers is that Social Security protects their savings from market losses, inflation, imprudence, and failure to thrive. It’s a damn good deal. You don’t need to beg for handouts from the rich man.
Social Security has always paid for itself, and there is no reason why it cannot pay for itself forever.
If we are going to live a lot longer we might need to pay a bit more. But the good news is that it looks like we will have more than a bit more money to pay it with. The only problem is convincing the damn fools that retirement is something they need to pay for, and the other damn fools that retirement insurance is something they need to pay for in case all their other schemes don’t turn out quite the way they expect.
Of course, the wealthy DO need to pay back the money they borrowed from Social Security. And not tell themselves lies like “it was really the government that borrowed that money, and it’s not fair the rich should have to pay no steenking taxes for the government to waste.”
Thomaso: “If the wealthy alone, not to mention the corporate, paid on 100 percent of their income, into social security and medi care, as the rest of us do, where would the problem be then?”
That’s pone possible approach, but I more agree with Coberly. It’s not FICA we want them to pay more of. It’s income tax they have to start to pay on all forms of income whether so-called earned income or dividend income or capital gains income. It’s all income. If the highest marginal rates for millionaires was raised a bit and all income were included as taxable at the marginal rate rather than a favored rate, the general budget would be less problematic. End the $trillion dollar per year defense budget and now you’re saving some real money. But some how canning a bunch of teachers seems like a better idea across the country.
Vote, and vote again through influencing your friends’ votes. Otherwise, we’re F—-d!!
by Bruce
Min. In 1983 Uncle Sam legally changed its obligation to me by changing my full retirement age from 65 to 66 years and 4 months. I didn’t complain then or now, a phased in increase in full retirement age and an equally phased in increase in payroll tax of 2 percentage points was the price of saving the overall Social Security system. We could have raised taxes a little higher and avoided the retirement age change but the deal actually cut split the difference.
To point out that Congress might decide on a similar solution to address the current 2.01% gap, say by slightly tweaking the COLA formula along with a smaller tax increase IS to “Get Real”.
It isn’t crazy talk to suggest that the future might mirror the past, that a 2011 fix might look much like the 1983 one did. You are of course free to characterize that as you choose, but the plain facts are that no future Congress is bound by the actions of any past Congress. They can and have changed that obligation as needed.
Coberly:
Thomaso is half right. If those making >$250,000 paid more into the General Fund through income tax, the hiding of the deficit through usage of the SS Withholding tax surplus would not be necessary.
run
absolutely. if the wealthy paid more INCOME TAX it would solve a host of evils.
Another “implicit assumption” of the peddlers of the crisis-two, crisis-three and especially the deficit-crisis memes is that the Social Security “surplus” will remain even though Social Security will be eviscerated ! Ie., employees will continue to pay their portion of the payroll tax, which won’t be used to pay Social Security benefits but instead will be used to keep income tax rates lower. The deficit-reduction crowd needs to be hammered on their “magic pony” logic of keeping the Social Security trust fund but jettisoning Social Security.