Is Social Security issue a potential big winner for Democrats?

[kentuck]

Please B'rer Fox, don't throw me in that briar patch. But, if the Democrats can keep the issue on the front burner thru the 2006 elections, could it possibly be the issue that could unite the Party and defeat the Repubs in the mid-term elections? There's a good chance Bush does not really want to talk about this issue that much - it's more or less just an aggravating diversion for the Democrats so h can keep them off-balance. He has no idea what the hell he's talking about. So if the Democrats play their cards smartly, it could be to their advantage?

[NMDemDist2]

1. only if the word gets out loud and often that the system isn't broken

and doesn't need "reform"

[RoeBear]

2. Do you think it will need

reform at some time in the future?

[NMDemDist2]

5. not in my lifetime

but maybe by 2050

[Yupster]

7. What about 2018?

when the system will start paying out more than it takes in and we'll discover that the surplus has been looted.

No problem then?

[NMDemDist2]

14. read the article linked in post 6 n/t

[Yupster]

16. But AzDem, don't you see

in that article it says that starting in 2018 we'll have to start tapping the surplus that we've been saving up.

You must know there is no surplus. It's already been looted.

Then it says in that article that in 2052 the surplus will be used up. HELLO. The surplus is already used up. There is no surplus. It's being spent as fast as it's coming in. It's not resting, or asleep r pining for the fields. It's a dead parrot.

Here's an anology.

At age 21, I loan my good for nothing brother in law $ 10,000. He promises to repay me with 10 % interest.

Then he spends the money on booze and women and blows the rest.

When projecting my retirement, I see that I don't have much saved up, but my numbers look fine when I remember the $ 640,000 my brother-in-laws loan future values up to at my age 62.

Now my wife told me she was concerned we didn't have enough set aside for retirement, but I told her she wasn't considering the $ 640,000 our account was owed.

When my financial advisor told me my brother in law was unlikely to make good on that $ 640,000, I showed him my IOU, and when he continued to question whether I would ever see a penny of that $ 640,000 I put my fingers in my ears while I repreated over and over "I can't hear you, I can't hear you."

So, I say without hesitation that social security will never see any hint of the hundreds of billions of dollars that have been looted from the trust fund.

But if you want to keep adding them into your figurings go ahead. You can even stick your fingers in your ears and say "I can't hear you."

[Debs]

41. Heres a better analogy

You give the Bank a large sum of money. The bank might not physically have that money in the bank but still has the legal obligation to pay you your money on demand and not the bank of outer Podunk rather the government of the United States of America which has NEVER defaulted on its bonds which is where the SS money technically is. You can say anything you want without hesitation and still be wrong, you are wrong.

[greenohio]

49. "where the SS money technically is"

Uhh, there is no vault holding a portion of the money (as in fractional banking) and there are no debtors who borrowed the money to pay it back. Now if your bank spent the invested money on salaries and roads and the welfare of the community while leaving notes in the vault (special edition t-bills) while saying they will pay that money back when they get more deposits, then your analogy applies. At that point though, that bank becomes a S&L from the 80's.

I think Yupsters analogy is closer.

[Pepperbelly]

18. give me a break, Yupster.

The surplus HAS been looted. Everyone knows that the money was borrowed by the rat-bastards in Congress to pay for day to day government operation. And in 2018, the government will pay off its bonds and notes, just like it is today and just like it's always done.

And that handles it until 2052.

About the same time that the actuarial problem of the boomers ends.

Of course, we could remove the ceiling of 80K and whoops, there it is. Solvency for as far as the eye can see.

[Yupster]

20. That would work as long as

congress had a few hundreds of billions of dollars hanging around to redeem the bonds. Heck - maybe they will. LOL.

I can guarantee that if congress ever finds itself with a few hundred billions of dollars of extra money, they'll find something to spend it on. They've never been too good at saving money for rainy days, but maybe that will all change.

Actually in the real world, here's how it's really going to work.

This is Yupster's prediction.

In 2017 the congress will decide that it's stupid having a charade of a social security trust fund when it's all just a general obligation of the federal budget anyway. They will vote to have a "Unified Budget" and they will be praised for finall being honest with the American people.

With that vote the hundreds of billions of dollars of bonds will instantly disappear because the budget can't owe money to itself.
Problem solved.

At that point congress will decide what it can afford and then will cut benefits or raise taxes or lengthen the rtirement age just like it always did.

And those hundreds of billions in surplus? They would have just disappeared in an accounting change.

That's my prediction.

[Pepperbelly]

22. it doesn't work like that ...

they pay bonds and notes off every day.

Why do you say that the government in 2018 will be any different?

[Yupster]

24. They do indeed

They pay my $ 10,000 bond off today by selling you an $ 11,000 bond today.

And you think that's just dandy I guess.

And when all the sudden they need to pay off hundreds of billions more they'll just go out and borrow hundreds of billions more and that can just go on forever.

Nope, not going to happen.

Much simpler for congress to just cancel the debt by creative accounting.

The looted surplus will never be repaid. It has not existed for a long time.

Doesn't matter if you believe me. The GAO accountants don't care what either of us say. They're there to find the least politically painful way out of this mess, and that sure isn't bankrupting the country trying to sell trillions of diollars of bonds that they couldn't even service the interest on.

[Pepperbelly]

28. nope ... that would be eactly the wrong thing to do ...

This "problem" is not a permanent problem. It is a demoraphic and actuarial generational pinch that passes with time. SS for boomers will be an expensive promise to keep but one that will not ultimately "break the bank". Your 'fix', however, would.

They will not default on the bonds and notes. However, cancellaton of the debt would 'break the bank.' There would be no more faith and credit for the US government which might suit the gops but it certainly would do no good for the country.

The boomers are a sine wave and that wave will pass as we die off. And yes, the promise should be kept. We, too, have worked hard and paid and paid and paid for many years.

[Yupster]

31. It won't change any faith or credit

The obligation is currently an obligation of the federal government and that's how it will remain once the budget is "unified".

There just won't be any bonds existing in a non-existant trust fund.

And congress will pay whatever it says it will pay which is the same that it is now.

The only difference is that the bonds will have disappeared into vapor which is what they are now anyway.

[Pepperbelly]

33. my question to you ...

is the same as to my old friend Kentuck ... how is it that even though the history shows the government meeting its financial obligations, they are going to change directions in mid-stream, without precedent, and blow off notes and bonds?

[Yupster]

34. They will meet their financial obligations

They'll send social security checks out to people for as long as the country exists.

And once a generation they'll have to tweak the system like they've always done. They'll raise the retirement age. They'll raise the payroll tax. They'll refigure the bendpoints formula.

The system will continue as its always been.

My grandparents paid a 2 % tax so their parents could get a check.
My parents paid 8 % so their parents could get a check.
I pay 15.8 % so my parents can get a check.
My kid will pay 22 % so I can get my check.

None of that will change.

But that has nothing to do with the sham of social security bonds that the government owes to itself.

How do you pay a debt back to yourself? It's just an accounting trick. In this case you will just wipe the bonds off the ledger and they will disappear and everything will still be the same as it was before.


Everyone will still get their checks.

And very few people will even ever realize that all that money that was supposed to go into social security trust fund went to make missiles instead.

Everyone will still get their checks just like before. The world will go on, and we'll all be happy.

[greenohio]

50. You seem to think that SS is in standard t-bills or bonds.

They are not. They are in special edition t-bills which the government only writes to itself. You cannot buy a t-bill or bond from SS money. The government has not paid anything on any of them because the program has been in surplus.

[kentuck]

21. The SS IOU's are worthless....

They are not worth the paper they are printed on. They are not like other Treasury notes and they have no plan on paying them off. We have been ripped off in the largest scandal ever in the history of government.

[Pepperbelly]

23. I do not believe that ...

What proof is there of this?

I have never heard of a single instance of them refusing to pay a bond or a note.

[kentuck]

26. There's a new book out...

Someone posted on it the other day. It's called the "Looting of the Social Security" or some such title. I do not recall the authors name. Perhaps someone can help us out on this? Anyhow, his very point is that the SS IOU's are totally worthless.

[Pepperbelly]

29. do you know ...

what proof he has of this?

[kentuck]

30. We can only go by logic and common sense...

Because none of us have any proof, one way or another. However, I do not see the IOUs the same way I see other Treasury notes...Because, who do we pay them to?

[Pepperbelly]

32. history is against ...

the proposition. History pretty well shows a record of paying notes and bonds.

And now it becomes common sense to believe that the history is totally wrong while this guy, whoever he is, is somehow right?

I don't see it.

[greenohio]

61. They have never paid a single SS note or bond.

Since they only need pay themselves the jury is out. They could very easily pay back less to themselves than promised and just reduce benefits. Either way, the money to pay themselves back has to come from somewhere, the budget or more taxes. There have been no payments to date.

[greenohio]

55. Depends on your definition of worthless.

If you mean you can't buy or sell them for money, then yes, they are worthless, because by law you can't.

They are a record keeping mechanism that the government uses to keep track how much money it owes itself for SS. It then spends the money on government programs along with all the other borrowed money. It hasn't had to pay anything back (let alone any interest) because SS has been in surplus, but according to the records, it will pay back over a trillion dollars eventually. In 2018, CBO and SSA project SS will have less income than outlayed. At that point we need to dip into the "trust fund"... or in other words, we need to start paying ourselves back. To do that we either raise taxes, or cut spending, or the economy grows enough and other spending stays flat.

[SharonAnn]

67. The IOU's are "backed by the full faith and credit of the US Government"

Just because they cannot be sold on the open market like T-bills doesn't mean they're worthless. They are demands on future revenue and it's not our fault that the Republicans are running huge deficits. They'll just have to raise the taxes that are needed to cover the IOU's.

Of course, they don't want to do that because they couldn't get away with just raising taxes on the workers, they'd have to raise taxes on the wealthy and on corporations. That's why they want you to think that all the money we loaned the US government is gone.

The IOU's are a demand on future revenues. They're real and they have to be honored. The Republicans just don't want to have to honor them.

[greenohio]

51. They've never paid on SS bonds or notes.

[SharonAnn]

39. So you think the government is entitled to steal from workers?

But repay loans to the wealthy adn to corporations?

It's on the workers that can be stolen from?

[kentuck]

40. I don't think they are "entitled" to steal from workers...

But some people are saying that is exactly what they are doing... I would liketo know and would like to hear the politicians say that they are committed to honoring the IOUs....George???

[Geek_Girl]

42. I think the caps should be lifted to at least keep up with inflation

When was the cap last raised? and figure the rate of inflation since that point and then add that to the cap. I think at that point the social security will be fine. If not then raise the age for social security to keep up with growing life expectancy.

There you go problem fixed.

Social security is not broke it just needs a little tweaking is all.

[greenohio]

53. A little tweaking.

Raising taxes and cutting benefits which may be "a little tweaking" to some, mean something more to others.

I wouldn't mind the little tweaking if we weren't doing it every 20 years. We doubled the SS tax in the 80's.

As long the the birthrate is below the population replacement rate, the trend line is clear.

[Geek_Girl]

54. Your going to have to tweak it every 20 years or So

To keep up with inflation and as people live longer. Thats just the nature of the beast. Nothing is a constant. Things need adjusting every now and then doesn't mean its broke or it needs to be thrown away. This is just common sense.

[greenohio]

56. It is a hard sell

to tell the working generation that it is common sense that they have to pay more and receive less in benefits. I have trouble getting excited about that.

[Geek_Girl]

59. Well I guess it depends on how you look it

If your making 200,000 or more and actually have to pay more into Social Security it benefits the middle class mainly who make below 87,000 so I don't know why that would be a hard sell to middle class America. Raising the age for benefits is a much harder sell. But if people are living longer then they are working longer and may not feel the need to receive the benefits as early.

But the alternative is far worse. And if you go with privatizing Social security it will end up costing tax payers trillions and will most likely bankrupt the country.

[greenohio]

60. Those are todays fixes.

After we raise the cap to 200,000 and we move back the retirement age, what do we do 20 years from now when we have to fix it again? Thats my point. My fear, is that the country is only going to put up with tax increases and benefits cuts so long before they decide they want to pitch it. The system has relatively small problems now, and look at the environment we are facing.

[Geek_Girl]

62. Then the problem is the environment were facing

Not social security. Every policy needs tweaking now and then thats just a fact of life. No policy is going to be 100% perfect for all eternity.

If the American people can't except that, and they allow themselves to be duped into believing otherwise then there will be no social programs like social security.

[greenohio]

63. So when people complain about

getting less benefits for more costs, over and over, its their attitude.

Well, I'll guess we'll just have to agree to disagree there and leave it at that.

[Geek_Girl]

65. No I don't think your getting off that easy

Do you have any ideas to fix social security?

Instead of critizing others why don't you offer some solutions?

[greenohio]

68. I believe I just did.

Just kidding. I think there are models out there we should look at like Sweden, and the UK.

I think investing any surplus in municipal bonds (state/city/township etc) will improve the return on investment.

I think removing all exceptions like state and teachers retirement programs should be part of the discussion.

Fundamentally, it comes down to population growth. I think we need a dialog about what growth rate this country needs to stay strong. There are those who think we should level off and keep it stable to avoid overpopulation. In a stable environment, each generation gets smaller. If we achieve that the boomer problem will seem like peanuts (considering the population is still growing today.) If we structure immigration policies for zero growth, then the changes to SS will need to be more drastic. In a zero growth model, each generation will need to pay more for its own retirement, rather than it being paid by the current working class.

I think Gores idea of mandatory retirement accounts outside of SS could be part of the discussion as well.

But I don't see any reasonable dialog happening within our party on any of these issues as they think the problems and the solutions are minor, practically trivial.

But Yupster is right:

"My grandparents paid a 2 % tax so their parents could get a check.
My parents paid 8 % so their parents could get a check.
I pay 15.8 % so my parents can get a check.
My kid will pay 22 % so I can get my check."

This while the country was growing substantially, both in wealth and population.

Some think this is fine and is as good as it gets. I think we can do better.

[Kurt Remarque]

3. we should have

(and maybe did) won in 2004 on ss and health care.

[greenohio]

4. Yes, in spite of ourselves.

We have no plan, and some aren't even willing to admit theres a problem. But shrub is going to screw it up, which will be a windfall for us. Unfortuately, the country will suffer in the process.

[NMDemDist2]

6. Crisis? What crisis?

Not only is Social Security not in crisis, it is as financially sound as ever, according to the liberal Center for Economic and Policy Research, run by Mark Weisbrot and Dean Baker, coauthors of "Social Security: The Phony Crisis."

Here's their argument:

Social Security can pay full benefits as promised until 2042 according to this year's Social Security trustees report (or 2052 if you use projections from the Congressional Budget Office). Thereafter it will be able to pay about 75 percent to 80 percent of promised benefits.

Even if benefits were cut to 75 percent of what's promised, that reduced level would still be more than what today's retirees get, he said.

For example, according to CBO estimates, a person born in 1940 would get about $13,300 in their first year of retirement, while someone born in 1990 would get $16,700 -- in today's dollars.

http://money.cnn.com/2004/12/15/retirement/what_crisis/

[greenohio]

11. I don't know. Where did you read the word crisis? Oh, in your post.

Does problem=crisis to people here?

There is a problem people. Deal with it.

"Even if benefits were cut to 75 percent of what's promised, that reduced level would still be more than what today's retirees get, he said."

That's it! Lets run on this platform. Non-"inflation adjusted" dollars will still increase people, so deal with the effective reduction in benefits. Brilliant. Those voting dolts will never know the difference.

[NMDemDist2]

13. the true wages have shrunk more that what the article says about

benefits

problem doesn't = crisis except when you listen to BushCo

my point is that we need to say it loud that BushCo is creating a bogus "crisis" so he can "reform" SS to feed billions to his Wall ST buddies

that's what needs to be the platform, BushCo's lies not SS as such

[greenohio]

15. Then stop listening to BushCo...because there is a problem.

Rather than saying "there is no crisis" We should be saying, the real solution to the problem is: such and such.

Right now, we have no alternative...and that is why we lose.

Trying to convince people, particularly the young independents, that there is no problem does not make us look smart.

Screaming there's little or nothing wrong is EXACTLY what shrub wants us to do.

[Geek_Girl]

43. and Add that his Plan will cost trillions

which we can not afford.

[Yupster]

8. Could be a very big win, but

we'll need to follow up defeating privatization with a plan of our own

Otherwise they'll be hell to pay when five years after arguing there is no problem, the same groups will be telling us what will be needed to be changed to avert social security's meltdown.

We need a better plan to beat their bad plan. Not no plan at all.

[ayeshahaqqiqa]

10. a simple plan

repeal tax cuts for rich and up the limit for paying FICA to $200,000. Simple, easy to remember, easy to explain, especially since the fat cats get SS too, and don't pay in their full salary like we peons do.

[Yupster]

19. That may work very well

It appeals to a very good emotion. Greed.

We need to raise taxes to give you something, but we'll only raise taxes on the other guys so don't worry. We won't raise your taxes.

That could work very well.

I would add we should also increase the benefit formula up to $ 200,000 too just to give some appearance of fairness.

It wouldn't make any difference dollar wise because the payout formula is so progressive now that the little bit the rich would get for their extra $ 18,000 paid in each year wouldn't amount to anything.

By the time the current payout formula gets to the top bendpoints, it doesn't add hardly anything anyway, so I'd suggest amending the plan to say that you want the premiums to be based on the first $ 200,000 of income, and you also want the payout formula to be based on the same figure so that yes the rich would pay more into the syatem, but they'd also get more out of the system too (though what they'd get out would be pennies compared to what they'd put in.)

I'd also like to have non-social security workers brought back into the syatem. That would also take a lot of burden off the system.

Also, the looting has to be addressed. The monthly surplus has to be put into bank cd's or something that is away from congress's reach. Otherwise it will continue to be looted.

[Lydia Leftcoast]

38. What's wrong with appealing to greed?

The Republicanites do it all the time, and it seems to work for them.

[greenohio]

57. We don't want to be like the repukes

do we?

[ayeshahaqqiqa]

9. Yes

Repukes are running scared on this. Even my conman, who has a 'safe seat' wrote a letter saying he would keep SS for those who have it now. AARP, not exactly a liberal organization, has come out with articles saying SS is not in trouble. We need to hit this hard and keep the information flowing through LTTEs, etc.

[InvisibleBallots]

12. It has always been a big winner for Democrats

It's been a consistent winner for 75 years - Democrats lose when they back away from it.

[OneBlueSky]

17. prediction: enough Democrats will vote with Bush . . .

to enact whatever "reform" he wants . . . as a party, the Democrats have no discipline, and I don't see them stopping this . . . the only way it will be stopped is if even more Republicans vote against it than Democrats vote for it . . . and that ain't likely, imo . . .

[Geek_Girl]

46. That's my biggest fear

I hope the democratic leadership stands up to this.

[Historic NY]

25. It needs to be hammer home that the system is working......but

would do better if all the chits were repaid.....and no more borrowing against the surplus it has.

[KnowerOfLogic]

27. It could be, but dems won't fight for it; they'll offer minor tweaking of

the repuke demolition of SS.

[w4rma]

35. Social Security hasn't been called "the third rail" for nothing. Light 'em

up. Repukes just grabbed it. I just hope that no more DLC Dems, in addition to Ford, are stupid enough to grab it with them, thus getting lit up too.

[Geek_Girl]

47. I heard Harold Ford Speak in Chattanooga

and he seemed to be against privatizing Social Security he said that the caps may have to be lifted or age for benefits be raised. That was the only thing he said that night that I agreed with. I hope that is the position the DLC takes.

[wiggs]

36. Mistake to focus on a "winner" issue

Environmental issues alone should have won the election for someone besides Bush. Read Crimes Against Nature (RFK Jr.) for the obscene details.

Iraq / WMD / should have been enough to derail Bush.

Abu Ghraib / torture memos / Guantanamo should have been enough.

Social security / privatization should have been enough to unseat this adminstration

Jobs / concentration of wealth / corporatism / deficits / voodoo economics should have been enough

Stem cells / disdain of science should have set off flashing red lights with everyone

Secrecy / Patriot Act should have been enough

House of Saud / Bandar Bush should have been enough

My Pet Goat, by itself, should have been enough


There are tons of killer "winner" issues out there. The issues weren't framed properly by the democratic candidates nor were they discussed appropriately by the media. It is not a matter of choosing the correct issue. It is all about controlling the discussion and overcoming lies, distortion, and media bias.

[proudbluestater]

37. We seem to have elected very few Democrats willing to take on

the cabal. Sad but true. Here and there one will speak out, but en masse, not much happens. It should be a good issue to capitalize on, but they don't seem inclined to do anything but roll over like they usually do. Definitely is time for a third, fourth, of fifth party. Dems no longer deserve our blind support.

[Name removed]

44. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Forkboy]

45. Someone pass the popcorn

this is getting fun!

[NewYorkerfromMass]

48. Really? I wonder what the other 91.67% of your contributions here

say to help relieve the geezers of their ignorance?

[bklyncowgirl]

52. You can't beat something with nothing.

The Democrats have to develop a plan. I agree that Social Security collapse is not immenent but the RW and their pals in the media have done a great job in convincing people otherwise.

The Democrats have to tell people the truth and then develop a common sense plan from the facts.

It must be simple to understand, attractive to the majority of voters and solve the problem in the way that Bush's plan does not. Raising the cap on FICA payments so that the rich pay more of their income into the trust fund is one solid suggestion.

The plan must be sold to the public at the same time that they are picking apart the problems with Bush's plan. Use fighting words like "gamble on the stock market."

However, if the Democrats continue to pretend that there is no problem lurking and that everything's just fine and dandy they are going to lose and lose big.

[greenohio]

58. Excellent Post.

Well put.

[Pepperbelly]

64. nowz this for the argument: you don't change engines when the sparkplugs

need cleaning.

[bklyncowgirl]

66. Nice analogy, sums up the problem quite well. nt

[greenohio]

69. Keep on driving that Studebaker.

It never goes out of style. First off, shrub is going to screw this up, but that doesn't mean that a program designed in the 30s should be left structured essentially the same for all time. The only way SS works is for an ever expanding population. If we ever achieve zero population growth, SS will crash, and crash hard. The boomer problem will look like peanuts because even with the boomer generation and a birth rate below replacement, the population still has grown substantially, mostly through immigration. We need a discussion about population growth targets (mostly through immigration policy) in conjunction the retirement system.

[Gyre]

70. democratic morons had their chance

to make this an issue and failed. Maybe they didn't have enough experience with bushco to know about inculcating fear, but I seriously doubt it. Pfffft!

Gyre

[greenohio]

71. I agree.

I was totally frustrated the Kerry appeared to run from this issue.

[hughee99]

72. I don't think so...

I think there are an increasingly large number of Americans that are invested in the market in one way or another (401K, 403B, IRA's and direct investments) and see the return they can get from the market as being greater than the guarantees from the current social security system. I think this is compounded by the fact that there is constant discussion of "cutting benefits". I think that when we make the argument that * will cut the benefits, it reminds some that the money in SS is not really guaranteed, and that their benefits can be cut at any time after they retire. For those people, especially younger people, the threat of these cuts makes their personal investments much more important. It also makes them more likely to look for ways to get a true guarantee for social security payments (like a "private account"). I think many people who are against the plan will vote Democratic anyway, and I'm not sure that it will bring in too many new voters. IMHO, this is not the issue that will bring in scores of new voters for us in the next election.

[FreeStateDemocrat]

74. Properly presented it will resonate with the our base - the working class.

Since when do you have any guarenteed return on stock market investments? What Social Security has provided for millions of Americans and will continue to provide is that every working class American can expect to be able to live with some dignity in retirement by being supplied with the necessary income to provide for their most basic needs. Social Security also provides a safety net for millions of working class Americans with disabilities and survivors benefits for millions more families. Social Security is a program that has been proven over generations to be good for our society as a whole and is an issue that can only advance the strongest values of the Democratic Party with working class Americans. This is another wedge issue that the Republicans will use to spread hate by attempting to divide the working class by appealing to the innate greed of some.

[hughee99]

75. Properly presented, it will be more effective

but I doubt that it will be as effective as we would hope. Though the stock market certainly has no guaranteed return, the return that many could expect from a "safe" investment (like bonds or a money market) would keep pace with the increases in social security. Some people, especially younger people, see the big issue as having the money specifically earmarked for their retirement (though I'm not sure that this will actually be the case). With this in mind, people will see this as being "their" money that the government can't take away. I'm not saying that this will actually be the case, but this will be the perception that we will have to counter.

[IStriker]

73. Not if they keep insisting there is nothing wrong...

I think there are very few people left who believe that if nothing is done, SS will be fine. So why are our Democrats in Congress and the Senate digging in their heels instead of coming up with a plan?