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- Subscribe - Contact Us - Rate Card - Place an Ad Archives Revels Classifieds Real Estate Menu Guide Wedding Weather Subscribe Contact Us March 10, 2005 Social Security raid built on spin By Tom Mathieson Ashland In his recent Guest Forum article, Doug Forsyth states that there has never been any money in the Social Security trust fund: "From everything I have read, no money has ever been saved for future retirees." This argument has long been popular with rightwing think tanks, and is being promoted by Fox news and other Republican news outlets. The thinking goes like this: The trust money was invested in Treasury Bonds. The government spent the money that was invested (as it does on all bonds). The government has run up huge deficits and has no money to pay off the bonds. Therefore, there is no trust fund. Quite a stretch. It's actually not so difficult to find the truth. The Social Security Web site describes how money is put into the trust funds daily and tells how much interest the funds are making. The site makes this unambiguous statement that the trust fund exists and its investments have value: "Far from being 'worthless IOUs,' the investments held by the trust funds are backed by the full faith and credit of the U.S. government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government." This statement is backed by the trust fund trustees, including the secretary of the treasury and the secretary of labor. During the 2000 campaign (remember Al Gore's "lock box"?) Bush promised not to touch the surplus. In his first State of the Union address he said: "To make sure the retirement savings of America's seniors are not diverted to any other program, my budget protects all $2.6 trillion of the Social Security surplus for Social Security, and for Social Security alone." But touch it he did. President Bush spent all $509 billion of the surplus collected during his first term. Effectively, it became one of the sources for the Bush tax cuts. The Congressional Budget Office estimates that the costs of the tax cuts over the next 75 years will be five times larger than the shortfall of Social Security over that period. In fact, the cost of the tax cuts given to just the richest one percent (millionaires) exceeds the Social Security shortfall. The huge deficits being run up by this administration and the Republican congress pose a major risk to our nation and our children's future. Ultimately, we will have to pay back all the money we have borrowed. Our creditors include foreign governments, the Social Security trust funds, and even small children whose grandparents gave them a savings bond. None of the rest of the debtors are likely to give up as easily as Mr Forsyth, who suggests American workers just forget about it and keep working until they are 75. Clearly some adjustments need to be made in Social Security. One idea with widespread support that would help solve the problem is to remove the cap that lets richer Americans stop paying Social Security after their first $90,000 of income. President Bush supported this plan until it was rejected by the Republicans in the House of Representatives. As usual, the Republicans are trying to smear and discredit everyone who stands in the way of their privatization plan. A front group is spending $10 million dollars to attack the AARP. Recently they placed an ad that asked "What is the AARP's real agenda?" A picture of a soldier was crossed out. The picture next to it had a checkmark and a picture of two men kissing. Mr Rove, have you no sense of decency? The factitious 'crisis' of Social Security By Gerald Cavanaugh Ashland The so-called Social Security "crisis" is phony, that is, made up, manufactured, factitious. It is sad to read the uniformed arguments of supposedly intelligent people (like Mr. Doug Forsyth, Mar. 1) who buy into Mr. Bush's pie-in-the-sky scheme to "save" Social Security and make us all wealthy above average, just like the folks in mythical Lake Wobegon. To say that the Social Security "trust fund" does not exist is not only false but must send shivers of cold fear through the central banks of China, Japan, and Europe all of whom own billions of dollars in American government securities. Why? Because if the trust fund does not exist it would entail the biggest governmental default in the economic history of the world and would send the American and the global economy into a tailspin. It is trivially true that the Congress and the president of the United States could so such a thing. After all, look at the results of the idiotic and irrational economic, fiscal and tax "reforms" they have already undertaken in the past four years. However, the Social Security trust fund, without any changes at all, will be able to pay retirees in the system full benefits until at least 2052. And to default on the enormous amount of the money in that fund would shock the American and international economy into a depression. The best way to avoid bankruptcy is to cut back on Porkagon spending and corporate subsidies, and to increase the federal governments income, that is, by repealing the Bush tax cuts for the very wealthy and the profitable corporations. Mr. Bush is unwilling to so betray his "base, the haves and have-mores," most of whom are also battening on the grotesque and unnecessary funds lavished on the Porkagon. Why ordinary Americans are not demanding those steps as a major part of the solution is beyond my understanding. In any case, there is no justification for fiscal insanity. One thing to remember: Mr. Bush will be safely out of office for years before the awful consequences of his policies hit home. He will then blame it all on Clinton. Of course, the trust fund will sooner or later need replenishing and the question is how to do that? One way is to raise the "cap" on earnings subject to the Social Security tax, from the present $90,000 to $200,000. This by itself would almost resolve the System's long range problems. Mr. Bush admits that his plan does nothing to solve those problems and he blithely accepts the reduction in benefits that would follow were his ideas adopted. Ah, the privatizers say, if Americans would commit to working until age 75, that would help. It was once believed that old age was supposed to be a time of leisure and reflection but thanks to the miracle of the market we Americans must contemplate working until we drop dead. The most depressing thing about the phony Social Security "crisis" is that so many officials and pundits ignore the difference between social insurance and private investments. Social Security is an insurance plan signifying our collective decision to keep every American out of a penurious old age; it is designed to assist all people and the widows, orphans and disabled. It is a a manifestation of social compassion and social solidarity. We need more of that today, not less. The next manifestation of that compassion and solidarity will take the form of universal, single-payer health care: Medicare for all, with a prescription drug and dental coverage. 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