I want a refund
In the 1980s, wise men decided we needed to boost payroll taxes to a level that would fund the retirements of the baby boom generation. In short, the plan was to raise taxes on the working class. For about 20 years now, we've been overpaying into the Social Security fund so we could avert a crisis. The overpayments were loaned to the federal government, at interest, so that when the baby boom began to retire, Social Security could cash in those bonds.
There is no crisis because we've been overpaying to avert it. Repaying a loan is not a crisis. But everything I've read about the administration's plan to phase out Social Security screams about a "crisis." This is not a crisis. It's a scam to get out of paying back the money to those who've overpaid for 20 years.
Scare tactics are the refuge of scoundrels. Looks to me like someone's crying "wolf" to scare people into returning to 1932.
I want a refund.
There is no crisis because we've been overpaying to avert it. Repaying a loan is not a crisis. But everything I've read about the administration's plan to phase out Social Security screams about a "crisis." This is not a crisis. It's a scam to get out of paying back the money to those who've overpaid for 20 years.
Scare tactics are the refuge of scoundrels. Looks to me like someone's crying "wolf" to scare people into returning to 1932.
I want a refund.
posted by All4Word at 7:14 PM
4 Comments:
Mondays are reserved for our Sound Off public affairs discussions. Come on down to the store at 7 and we'll talk.
We'll use Ponzi: The Man and His Legendary Scheme as our book-hook.
But it's not a fiction. That's all part of the "framing" that has been done so successfully. Lower income workers pay from the first dime a tax on their wages, a singularly regressive tax. The raise in taxes on wages doesn't allow for deductions, credits or any sense of equitable taxation. If it's just an income tax under another name, then your argument is valid. But then, to raise that tax is to basically say we are abandoning the progressive income tax.
However, the payments are invested, giving the federal government an easy source for borrowing. If they never had any intention of repaying it, why load the tax on those least able to pay?
It's Ponzi, all right. Either it's an insurance program, adequately managed with a sinking fund, or it's the most regressive tax system ever created. You can't have it both ways.
They say "Ooooohhhhh, we'll have to raise taxes to pay it." They should have thought of that before they borrowed the money.
The New York Times states the facts correctly:
"Starting last year, as the groundwork was being set for the emerging debate, the Social Security trustees took the liberty of projecting the system's solvency over infinity, rather than sticking to the traditional 75-year time horizon. That world-without-end assumption generates the scary $10 trillion estimate, and with it, Mr. Bush's putative rationale for dismantling Social Security in favor of a system centered on private savings accounts."
From Josh Marshall's Web log:
Here is one of many comparisons and observations we'll be making to provide some counterweight to the White House's efforts to deceive the American people about Social Security.
The Social Security Trustees estimate that over the next 75 years the program faces a budget shortfall of $3.7 trillion.
As we've noted previously and will again, the Trustees use a very pessimistic estimate of future economic growth to arrive at that figure. But, for the moment, let's stipulate to that amount.
$3.7 trillion is a lot of money.
But how much will the president's Medicare drug benefit plan cost over the next 75 years?
$8.1 trillion, say the Trustees of that program.
And over the next 75 years how much will the president's 2001 and 2003 tax cuts cost if made permanent, as the president wants?
$11.6 trillion.
So you add that up and you get $3.7 trillion we need to cover Social Security's shortfall and $19.7 trillion we need just to cover the costs of the two major domestic policy initiatives of the president's first term.
And yet Social Security, says the president, is in crisis and destined to chew through the rest of the federal budget.
(These statistics are noted in this budgeting summary from the Center on Budget and Policy Priorities.)
I would submit to you that in any reasonable universe this simple comparison shatters the president's credibility on fiscal 'icebergs' and spending crises. And yet these basic facts seem to garner little notice.
That is because, in the last couple decades, in the culture of Washington -- particularly among the elite commentators and reporters (just watch Meet the Press) -- presuming that Social Security is financially unviable has become an ready shorthand for public policy seriousness, much as many use a basic knowledge of imported wines or a familiarity with classical music to signal refinement.
This is something the president is exploiting. And the defenders of Social Security must find ways to overcome it
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