Other polls this year by the Washington Post, Gallup, etc. show a two-thirds majority opposes raising the retirement age, reducing benefits, means testing benefits, and favors taxing all income, including dividends and capital gains.
The president, again negotiating with himself, has proposed cuts to Social Security for current and future seniors. It is called the “chained CPI,” a harmless-sounding name for a way to hold your taxes level while reducing your retirement or disability benefits.
The chained CPI takes into account that if hamburger prices rise, a retiree can buy cat food instead, thus lowering his or her grocery bill. This is like “catsup is a vegetable” for those old enough to recall that kerfuffle.
The chained CPI reduces the annual cost of living adjustment by about 0.3 percent annually. It doesn’t sound like much, but these decreases compound over time.
Hardship falls most severely on the oldest recipients, who are usually the poorest, on disabled veterans, and on developmentally disabled persons. Because of the compounding effect, the suffering arrives at the end of your life. It’s like gradually turning up the heat on the proverbial frog in a pot of warm water.
Current and near retirees are not exempt from this cut; they will see their benefits and standard of living decline, especially as Medicare premiums take a larger bite of their Social Security. So will military retirees and civil servants.
For current workers, the chained CPI is a stealth income tax increase. As your income grows more rapidly than the chained CP1, you will climb into higher tax brackets; those who are lucky enough to be liable for income tax will be paying more.
Social Security is separated by law from the United States general budget. It receives no funds from the federal government and cannot borrow money; it has never added a penny to any deficit or the unified federal debt.
In fact, Social Security holds a surplus totaling around $2.8 trillion and growing.
Cutting earned Social Security benefits for current, near term, and future seniors does not reduce future deficits or the accumulated debt of the federal government one iota.
It will result in significant pain and suffering for the elderly, who earned Social Security, but will not reduce the debt or leave your grandchildren a better world. If this structural change to America’s most popular and beneficial social insurance program goes through, you and your grandchildren will be more hopelessly stranded in economic insecurity.
Toward the middle of the website is a section titled, “Impact on National Debt.” In this section we read the following:
“1. The Social Security program has an independent budget that is separate from the rest of the federal government. 2. When the Social Security program collects more in taxes than it spends, it generates surplus money. By law, the only thing that the Social Security program can do with surplus money is loan it to the U.S. government. 3. When the Social Security program loans money to the U.S. government, the government is obligated by law to pay this money back to the Social Security program with interest. This money becomes a part of the national debt.”
Our elected officials have spent the money; it is gone. So we must get it from somewhere (us) to pay Social Security back; that is debt.
I don’t believe everything I read on the internet but this makes sense and matches much of what I have read from other sources. I recommend each of us spend a few minutes reading these two documents and then forward them to our Representatives and Senators. They need to know we know the facts and will not put up with anything but the truth.
David K. Wright, 760-766-3693, dkwright@comcast.net
Kudos for looking for facts. I did check the site you referenced and found the facts presented there are true, but incomplete.
So again, Social Security does not add to the accumulated debt of the federal government.
The reason is simple. Social Security’s debt limit was set in 1935; it is $0.00. It cannot create debt!
The fact that Social Security prudently built a surplus to meet anticipated future expenses does not increase the US General Funds debt. Lots of institutions and people buy US Government debt; does that mean they are contributing to the deficit? I don’t think so.
Other expenditures authorized by Congress created the current debt.
Yes, you will have to redeem the special issue Treasuries our parents wisely accumulated for support of Social Security.
Of course, you could save taxes by raiding your mother’s bank account and pantry.
Given the libertarian sponsorship of the website you referenced, your actual objection is probably to Social Security itself. That’s ok; but you can’t use Social Security as an out of control debt machine to undermine the only economic security most people have left.
Some facts about Social Security in Georgia:
Social Security is an earned insurance benefit protecting families from disability, job loss, early death, and poverty in old age.
1.4 million Georgians benefit from Social Security.
Without Social Security the poverty rate among the elderly in Georgia would increase from 10.5% to 47%.
Social Security’s early death or disability coverage protects young working families with annuity survivor benefits with a present value of $476,000. That is likely the only coverage they have and they probably don't know it.
Without Social Security payments, Georgia’s economy would lose $16.7 billion annually.
218,000 children living with grandparents in Georgia rely on the Social Security of their grandparents.
Returning the covered wage cap to the original 90% of covered wages and a 0.05 % increase on employee and employer each year between 2021 and 2040 would fully fund Social Security for 75 years. That amounts to about $43 a year for the average wage earner. Sounds like a good deal to me for our society and economy. Lots of my high flying boomer friends who got clipped in the bank fraud and real estate bubble are very happy they paid into Social Security.
Mike L Reynolds