Forbes Bush's hates means testing, Reich argues for it?

[Hamlette]

at least he says means that AND lift the cap (from current $90K)

Has the world gone mad?


Forbes said if you means test you turn it into a welfare program and lose broad based support for it (quoting Moynahan (sp))

edit to add source, both are being interviewed on Wolf Blitzer. Also note Forbes is for private accounts.

[iconoclastic cat]

1. hmmm....

[bluestateguy]

2. reply

Once you turn it into a welfare program for the poor you make Social Security the type of government program that will be vulnerable to political attacks and budget cuts.Very few programs that benefit mostly poor people are popular with the American people, and that's why it's always those programs that are put on the chopping block when there is a budget crunch.

[TahitiNut]

3. Social Security benefits need no more "smoothing" than already ...

... designed into the system. The Gini coefficient for OASI benefits is around 0.23 - far, far lower than the Gini coefficient for family income (around 0.45) or for individual income (around 0.52). A lower Gini means a more uniform distribution, with a Gini of 0.0 (zero) meaning completely equal amounts.

That there's such a huge difference is an indication that the system replaces/continues a far greater share of lower incomes than of higher incomes, despite the fact that the tax rate is flat. With a completely flat conversion of contributions to benefits, the Gini coefficient of OASI would be very close to the Gini coefficient for income. It's not. Not even close.

The distribution effect of the current system is NOT broken - not for a "safety net" program.

[salvorhardin]

4. I would expect

that one of the primary reasons for even the minor deviation your post shows is due to the fact that the income gap has widened so dramatically. Our middle class has shrunk and so workers are contributing far less to the system and when they start drawing on the system their benefits are a much larger percentage of their incomes.

Great post BTW!

Oh, and in case someone is unfamiliar with the term, the Gini coefficient is a measure of inequality.
http://mathworld.wolfram.com/GiniCoefficient.html

OASI=Old Age and Survivors Insurance trust fund.
http://www.ssa.gov/OACT/ProgData/describeoasi.html

[TahitiNut]

5. I think it's inarguable that class warfare has decimated payrolls ...

... and thereby has had the secondary impact of eroding Social Security. This is the real 'crisis' - not the canary in the coal mine that're Social Security solvency projections.

We can clearly see this in the stagnation and erosion in the payroll base during the Bushoilini Adminstrations wherein the class warfare has succeeded in murdering too many of the middle class.

It should be noted below that the Wage Base figures employed by the SSA are derived from W-2's. Thus, they include all W-2-reportable income, even for the HUGELY-compensated top executives. So, even the graphs below are an understatement of the decimation of the "bottom 95%" of workers. (It's the 'myth of the "average".')

[JDPriestly]

7. You are right.

I wish this could be on the DU front page. This is the unvarnished truth about our economy and Social Security. Thinking that we can educate or retrain ourselves out of the downward spiral of our economy is foolish. Americans are watching the decline of our nation and shutting their eyes to reality.

[JDPriestly]

6. You hit paydirt.

If Social Security goes into a crisis at some future date, it will be because American wages and the tax revenue based on them has decreased drastically so that the amounts paid into Social Security can't cover the benefits its owes. Bush would never admit that, but drastically reduced wages for Americans is the assumption for the future. Our lifestyle -- and I'm not talking about the waste and luxuries we could do without -- is in severe jeopardy due to international trade. To believe otherwise is to live in a fool's paradise.

[Hamlette]

8. isn't it simpler than that even? Didn't they just steal the money out of

the trust fund and now they don't want to pay it back and they say they can't pay it back because they gave all the tax cuts to the rich and they gave all the tax cuts to the rich so they wouldn't have to pay it back?

Seems they been working on breaking SS all along.