Top 5 Social Security Myths

Myth #1: Social Security is going broke.
Reality: There is no Social Security crisis. By 2023, Social Security will have a $4.6 trillion surplus (yes, trillion with a 'T'). It can pay out all scheduled benefits for the next quarter-century with no changes whatsoever.1 After 2037, it'll still be able to pay out 75% of scheduled benefits-and again, that's without any changes. The program started preparing for the Baby Boomers' retirement decades ago. Anyone who insists Social Security is broke probably wants to break it themselves.

Myth #2: We have to raise the retirement age because people are living longer.
Reality: This is a red-herring to trick you into agreeing to benefit cuts. Retirees are living about the same amount of time as they were in the 1930s. The reason average life expectancy is higher is mostly because many fewer people die as children than they did 70 years ago.3 What's more, what gains there have been are distributed very unevenly-since 1972, life expectancy increased by 6.5 years for workers in the top half of the income brackets, but by less than 2 years for those in the bottom half.4 But those intent on cutting Social Security love this argument because raising the retirement age is the same as an across-the-board benefit cut.

Myth #3: Benefit cuts are the only way to fix Social Security.
Reality: Social Security doesn't need to be fixed. But if we want to strengthen it, here's a better way: Make the rich pay their fair share. If the very rich paid taxes on all of their income, Social Security would be sustainable for decades to come.5 Right now, high earners only pay Social Security taxes on the first $106,000 of their income.6 But conservatives insist benefit cuts are the only way because they want to protect the super-rich from paying their fair share.

Myth #4: The Social Security Trust Fund has been raided and is full of IOUs
Reality: Not even close to true. The Social Security Trust Fund isn't full of IOUs, it's full of U.S. Treasury Bonds. And those bonds are backed by the full faith and credit of the United States. The reason Social Security holds only treasury bonds is the same reason many Americans do: The federal government has never missed a single interest payment on its debts. President Bush wanted to put Social Security funds in the stock market-which would have been disastrous-but luckily, he failed. So the trillions of dollars in the Social Security Trust Fund, which are separate from the regular budget, are as safe as can be.

Myth #5: Social Security adds to the deficit
Reality: It's not just wrong-it's impossible! By law, Social Security's funds are separate from the budget, and it must pay its own way. That means that Social Security can't add one penny to the deficit.

Defeating these myths is the first step to stopping Social Security cuts.

I never understood why people could make a million dollars and only pay social security on a tenth of it. That needs to be changed!

One of the greatest rip-offs of late is refusing to pay our yearly COLA (Cost Of Living) meager increases. Every dollar makes a difference to those of us who depend upon Social Security as our only income.

As a continuing example of the COLA importance is the WEEKLY INCREASE of groceries at the store. I'm aware of the way the producers change the amount of contents in many food packages, as well as increasing the packaging itself. There are very few "sales" in the weekly circulars. And most other necessities are increasing in price. The economy is on the RISE? Not for those of us who have to watch every dollar.

I generally plan on having to work till Im dead. IF I somehow magically get any of what I have paid into SS...well, thats just dandy!

Gene Larson wrote:

I'm aware of the way the producers change the amount of contents in many food packages,

Gene, I'm with you on this; I find it very irritating when manufacturers try to sneak price increases in by offering less product for the same (or higher) price. I guess they have us pegged for a bunch of idiots who won't notice the difference.

I once complained to Alcon Labs about them switching their Opti Free contact lens solution from 12 ounces to 10 ounces but they kept the same size bottle and box. They responded and told me they did it because they didn't want to have to raise prices.

And they assume we are so stupid we don't notice that getting less for the same price IS raising prices. Corporations. Bleah.

Social Security is a communist plot and I, for one, won't have any part of it! I trust Gunnar feels the same way.

Yes, I will probably also work until the day I die. My dad retired at age 55. I turned 62 this past week and it looks bleak for retirement as I have been sending my monies to various universities the past few years.

Wendy, as the great poet Merle Haggard once said, its "So-called Social Security".

Not to tie this too much to another thread, but in defense of small sizing being limited to corporations, I noticed the water level at the Oasis wasn't quite as high as last year, which was slightly lower than the year before.

Cheaper entry?? Not so, Hugo!

Update, "Social Security is still in long-term strong shape, according to the most recent report by the Social Security Board of Trustees."

"That should serve as "comeuppance for the right-wing, ideological" politicians clamoring for benefit cuts, higher retirement age and privatization."

The catfood commission already knows what the cure is, now they're just trying to find a disease to justify it.

This is awesome. United States debt isn't really debt because it's owned by the United States!

The logic is foolproof! We'll never run out of money!

The trust fund is a fiction. If the private sector tried this kind of accounting, you'd be asking them how tight they'd like their handcuffs.

http://reason.com/blog/20...n-an-imagi

I never understood why people could make a million dollars and only pay social security on a tenth of it. That needs to be changed!

Uh, because once you reach the ceiling on Social Security, they cap the benefits they pay out. You're asking someone to pay ten times as much for the same lame product they had before.

It's essentially like selling someone a happy meal for $50, just because they make more money than you. Oh, except you put a gun to their head and force them to buy it.

It is what it is. A giant tax increase for the sake of wealth redistribution.

Wealth redistribution is a good thing.

A return to the Gilded Age would be a bad thing.

Alot of people think so Gunnar. So long as it's someone else's wealth.

Once the respect of property fence has been completely torn down though, the 51% will keep taking from the 49, until nobody has any incentive to do much of anything.

In the long run, it's best for everyone for taxes (and regulation) to be geared towards competitiveness more than comfort. It's much better to have opportunities than handouts.

Even though Social Security is still in long-term strong shape this type of whit is happening.

You can't make this stuff up.
"The economy is in shambles, unemployment is at record levels and home foreclosures are soaring. Congress can't get it together to act on these issues. But there's growing momentum in Washington to-wait for it-slash Social Security?
Believe it. Republicans are campaigning on benefit cuts. Conservative Democrats like Steny Hoyer are echoing their talking points.

Everyone's counting on the Deficit Commission to do the dirty work. The commission is stacked with conservatives who've embraced cutting Social Security, and both houses of congress promised to fast-track a vote on its recommendations. That means that even though no jobs bill can pass congress right now, Social Security cuts might."

Yes, Brady. The Obama administration and Democrat-controlled Congress appointed a commission stacked with conservatives, promising to fast-track whatever they serve up.

It was all laid out, blow by blow in this week's Workers' World.

DA, "Conservative Democrats like Steny Hoyer are echoing their talking points".

Wow, 7 points (out of 100) on the ACU scale is all it takes for you to tag someone Conservative nowadays...

No wonder you hate Conservatives. By your definition, we're everywhere!

Rick, I do not hate conservatives just ignorance and greed, from both parties.

After all a new poll shows 68 percent of likely voters oppose cutting Social Security and Medicare to reduce the deficit. In another poll:

" A recent poll by Survey USA about corporate influence over our democracy shows that voters want their leaders to stand up on this critical issue. Here's what it found:"

"An overwhelming 73% of voters, including 67% of Republicans and 71% of independents, are more likely to support a candidate for Congress who works to reduce the influence of corporate lobbyists in Washington."

"And almost two out of three voters (60%) disagree with the Supreme Court's decision in the Citizens United case."

Republican Minority Leader John Boehner just proposed deep cuts to Social Security to pay for big tax breaks for the richest Americans.

Give money to the rich and take it from the poor.

Boner is just pissed about the tanning booth tax.

Al Gore's "lock box" was never built, and even then it would have been too little too late.

All that is in the Social Security trust fund is a post-it note that says:

Dear Social Security,

Thanks for keeping the government truckin'! You're the greatest!

Love,

Congress

PS: IOU $10000000000000(zeros continue on other side)

I think that the government will continue to fund SS. It's the most popular program in the history of the US government, but it's going to start to get really painful in about 10 years or so, and Medicare will be even worse.

After all a new poll shows 68 percent of likely voters oppose cutting Social Security and Medicare to reduce the deficit. In another poll:

" A recent poll by Survey USA about corporate influence over our democracy shows that voters want their leaders to stand up on this critical issue. Here's what it found:"

"An overwhelming 73% of voters, including 67% of Republicans and 71% of independents, are more likely to support a candidate for Congress who works to reduce the influence of corporate lobbyists in Washington."

"And almost two out of three voters (60%) disagree with the Supreme Court's decision in the Citizens United case."

And this is why nothing will get done about SS and Medicare until it's a full-blown disaster.

Medicare is really the part that's pretty much impossible to deal with, even at this point.

Here's a cheery little chart for you:

[gvideo]-7461407498377956300#[/gvideo]

[This message has been edited by Levi Forman (8/21/2010)]

Get up to date. The social Security trust fund was done away with by prez Johnson in the 60's and put into the U.S. general fund. Social security receptients are paid out of the general fund. If it were left in a trust fund it could probably pay off our national debt.

I think that is a modern myth.

What is a modern myth? That social security is paid out of the general fund? Not a myth at all, it's an easily verifiable fact, although it is slightly confusing because of those treasury bonds which most people are not familiar with. Here's a decent explanation by the Office of Management and Budget via Wikipedia:

These [Trust Fund] balances are available to finance future benefit payments and other Trust Fund expenditures - but only in a bookkeeping sense.... They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures. The existence of large Trust Fund balances, therefore, does not, by itself, have any impact on the Government's ability to pay benefits. (from FY 2000 Budget, Analytical Perspectives, p. 337)

They are documents saying that the US government is required to pay these benefits. They are not money themselves.

By Jane Slaughter

Why does a billionaire want to take away your Social Security benefits?

Peter Peterson is 84 years old. He's old enough to relax and enjoy the fruits of the years he was well paid for managing other rich people's money. Why is he spending his fortune to convince politicians they should ruin the average guy's retirement?
Today Peterson announced the next facet in his long campaign to hack Social Security, including a joke Presidential candidate named Hugh Jidette ("huge debt") and a website called Owe No. His aim is to convince Congress to raise the retirement age, cut Social Security's cost-of-living increases-and raise the payroll taxes we pay for Social Security and Medicare.

It wouldn't matter what one cranky octogenarian billionaire had to say if he weren't putting $6 million into ads, funding "expert" commissions, and spreading lies designed to panic the populace.
Maybe Peterson figures offense is better than defense-he's got a lot to defend. He made his fortune as a hedge fund manager-that is, moving money around-so he ought to be living in fear. Someone might get the idea he and his buddies would be good folks to tax. It's like Willie Sutton, the famous bank robber, once said. Asked why he robbed banks, Sutton replied, "Because that's where the money is."
Peterson and pals are the ones George Bush gifted with big tax breaks that are set to expire December 31. Although he says his top priority is reducing the deficit, Peterson doesn't want to cut that deficit by putting his own taxes back where they were in the 1990s.
It's hard to get your head around how rich Peterson is, and how many rich people there are in this country. But here's how to put their money in perspective, in relation to Social Security. If Congress decides to extend those tax cuts, for households making $250,000 or more (the top 2 percent of earners), the money the Treasury will lose would be enough to put Social Security in the black for 75 years--and raise benefits by 2 percent.

First They Took Your House

Meanwhile, we have a big chunk of near-retirees today who have barely seen their wages rise at all during their working lifetimes, the last 30 years. They couldn't save a huge amount; what they saved they had in home equity. And that was wiped away by the financial shenanigans of Peter Peterson and his ilk. There are millions of potential retirees who will have next to nothing except Social Security if they're ever able to retire. It wasn't enough for Wall Street to rob us of our houses' worth and what we had in 401(k)s. Now they want to take Social Security too.

Like I said, I don't understand it. Is there no shuffleboard court where this man could spend his golden years?

A friend wrote to me today. He's working his butt off to keep Congress from raising the retirement age and cut back Medicare. He said:

My mother was an LPN in a nursing home. The last few years that she worked, her back and legs ached so much that she literally had to crawl up the stairs to her bedroom at night. If someone told her that she would have to work three more years before retirement because hedge fund managers don't want to pay the same percentage of their income towards Social Security as she did, she would tell you what to do.

Because FYIGM!!!!

If Congress decides to extend those tax cuts, for households making $250,000 or more (the top 2 percent of earners), the money the Treasury will lose would be enough to put Social Security in the black for 75 years--and raise benefits by 2 percent.

Gonna need some fact checking on this little nugget. I'm guessing what she means is that it would be enough to fund the projected deficits IF the alleged Social Security Trust fund had actual money in it. I didn't look hard enough to find real great numbers, but the one I found said that removing the tax cuts on the rich would generate $350 Billion over 10 years. Since Social Security's annual budget is $615 Billion right now and growing quickly, with projected annual deficits of over 400 Billion by 2040, I'd say your article is full of crap.

[This message has been edited by Levi Forman (12/3/2010)]

I didn't look hard enough to find real great numbers, but the one I found said that removing the tax cuts on the rich would generate $350 Billion over 10 years.

Everything that I have read says that doing away the tax cuts on the rich will generate $700 billion over 10 years.


What is really pathetic is that most hedge fund managers take a good portion of their income as stock profits, which if held for two years are taxed at only 15 % instead of the 35% if taken as wages.

Where did you find this? I realize that it's going to be an estimate and estimates can be slanted the way that you want them to be but either way saying it's capable of "putting social security in the black for 75 years" is off by at least an order of magnitude.

Levi,

I have heard the $700 billion number on the news and here is a link to a NY Times article.

http://www.nytimes.com/20...11tax.html

As for the article that Stone posted, I haven't had time to check the numbers.

The rich will still realize tax savings on their income in the lower tax brackets and also on their investment income.

Mr. Peterson is bitter because his parents named him PETER PETERSON.

Nonetheless, Levi a billionaire is fighting to get rid of SS. You do not find that odd?

I do find that a bit odd. I guess everybody's got a hobby :P.

He's just fighting socialism.