Bachmann doesn't like Perry's characterization of SocSec.
But it's not because Perry is
right or wrong......
...
in Tampa, it seems safe to predict that moderators will ask at least some other candidates whether they agree with Perry's characterization of Social Security.
"Certainly not," the adviser says. "She strongly disagrees with his position on that, and it's clearly not something that's going to sit well with the people of Florida and Iowa and South Carolina and many of the early states, where there is a large population of seniors who rely heavily on Social Security. For [Perry] to scare them is wrong."
The utterly cynical and morally bankrupt "politics" spews its pus over the real question.
48 comments:
Perry scares most voters for reasons unrelated to his moronic comments on SS. Let us pray that he exit the stage in short order and return to Austin, which is better suited to his inane bluster.
Pon·zi scheme [ pónzee skm ]
pyramid investment swindle: a pyramid investment swindle in which supposed profits are paid to early investors from money actually invested by later participants.
Perry is accurate.
And for Bachmann and Romney to go all mushy Politik...
Of course, we THINK that Perry is not accusing FDR and subsequent legislators/executives of deliberate fraud.
Sans the criminal intent, SocSec IS a Ponzi scheme.
I think what I heard Perry say was that it is pretty moot to even try to figure out what FDR really had in mind... Though I am certainly interested in getting some more detail from him on his proposed changes.
"Well, I think any of us that want to go back and change 70 years of what's been going on in this country is probably going to have a difficult time. And rather than spending a lot of time talking about what those folks were doing back in the '30s and the '40s, it's a nice intellectual conversation, but the fact is we have got to be focused on how we're going to change this program.
And people who are on Social Security today, men and women who are receiving those benefits today, and individuals at my age that are in line pretty quick to get them, they don't need to worry about anything. But I think the Republican candidates are talking about ways to transition this program, and it is a monstrous lie.
It is a Ponzi scheme to tell our kids that are 25 or 30 years old today, you're paying into a program that's going to be there. Anybody that's for the status quo with Social Security today is involved with a monstrous lie to our kids, and it's not right."
40 years ago in Business school they told me it was unlikely that I'd see any Social Security. Now I'm 4 years away from qualifying for full benefits and I know that if NOTHING is done about Social Security, I'll be getting full benefits at least to age 88 and 75-80% of scheduled benefits forever beyond that. IF NOTHING IS DONE.
Here is a Venn diagram of Social Security and a Ponzi scheme.
Note that the only commonality is that both are referred to as "ponzi schemes" by Rick Perry and the GOP.
Congrats Jim. My two kids will be supporting you with ever-rising payroll taxes.
You're welcome.
And their kids them, and so forth and so on.
Yes they will neomom. Because the growth in payroll taxes is based upon future productivity growth which translates to real wage growth and payroll taxes.
You need to read something outside of political talking points once in awhile.
Omit the second "and payroll taxes". Sent from my phone.
Because the growth in payroll taxes is based upon future productivity growth
That would be a change from the last 20 years' experience. All NeoMom and I read are business P&L's.
As to Jimbo, fat/happy on SocSec: it's all about YOU, Jim! Congrats.
BS Strupp.
It would have worked if the kids of the baby boomers had continued to procreate and those same baby boomers would die younger. Combine the reduction in the birth rate with the increase in the life expectancy and you get a program that had about a 16:1 worker to recipient ratio to the about a current 7:1 ratio and rapidly reducing.
Hell, I'm 43 and expect nothing.
You may want to pull your own head out of your behind once in a while.
growth in payroll taxes
....is based solely on the number of people PAYING them, unless you're proposing to eliminate the cutoff.
???
You expect to get nothing in 20 plus years?
By the most conservative estimates, SS can pay full benefits until sometime in the 2030's (2038 by most projections) and then 80% of current benefits indefinately if we do nothing to extend full benefits between now and then.
The "ponzi scheme", "I'm not going to get any money" stuff just isn't accurate.
Americans get spoon fed this crap every 10 years or so when Republicans decide that they want to "fix" SS by dismantling it.
The long term solvency of SS is a minor problem that we can deal with at some point in the future.
And BTW, the people who have been telling you that SS is "broke" are the SAME folks who took most of those payroll tax surpluses from the late 90's and sent them up the food chain to the job creators in the early 2000's. Now they're bitching that SS is "broke".
If they don't have a name for that scheme I'd like the first crack at it.
Afterall, if you convince people that they'e not going to get any SS benefits, it's easier to get rid of it.
are the SAME folks who took most of those payroll tax surpluses from the late 90's
That would be Clinton and Congress.
I never said that NONE of them were crooks and frauds.
Gee Strupp - you say I spew certain talking points and here you are spouting the Democrat ones.
Lets get grounded on a few things.
- There never were any personal savings accounts
- There never was a lock box
- There never was a trust fund - it is a filing cabinet full of IOUs. Seriously.
- Social Security is in the red this year. See my earlier comment about birth rates and baby boomers to understand the fallicy of your assumption that all would be perfectly fine with just a few "tweaks".
Politicians for decades - of all political stripes - have been using the money for the payroll tax to bankroll all sorts of fab projects from the Great Society to the further bastardization of the tax code.
So we can all hold our breath and stamp our feet pretending that none of the above is real. We can have a conversation or we can fall for the granny will have eat cat food Bull...t political commercial lines and never do anything. Social Security needs to be transitioned into a true "safety net" - which was its original intent - and away from the US Retirement plan. (Note the work "transition", not "eliminate")
That needs to include lifting the cap on the tax past the $106K or whatever it is and then also means testing the recipients. Take a look at the millionaires in Congress and the Senate. If they are above 65, not only are they getting their gov't salary or pension and healthcare for life - they are receiving Social Security.
I know a man who worked at Harley - literally until he died. He refused to retire even though he was 70. In addition to making over $100K with overtime for (not kidding on this one) only changing light bulbs, he was receiving his full Social Security check.
In the mean time, we have truely poor elderly and disabled that are barely subsisting.
Bravo on Rick Perry for trying. A pox on those that want to silence the converstion for political or personal gain.
I guess I'm not sure how Social Security can be viewed as anything other than a social safety net. The max. SS benefit is something like $29,000 year. Try to live on that and tell me that SS is a "U.S. Retirement Plan".
"That needs to include lifting the cap on the tax past the $106K or whatever it is and then also means testing the recipients."
I would consider those ideas as tweaks. Nothing major needs to be done other than lifting the cap actually. As I said before, 80% of benefits could be paid to recipients past 2038 if nothing is done.
Lastly, why should your former co-worker denied benefits for working his entire life even though he paid into the program for 50 years? That doesn't make any sense to me.
former co-worker denied benefits for working his entire life
It's called "means testing," Struppster. You know: the Leftist Ideal: rich pay more (or get less)...remember?
And there is no proposal--from anyone--which would change bennies for anyone over the age of ~55.
So you need new talking points.
I pay all sorts of taxes for working since the age of 15 that I will never receive anything back for. So what. I have understood all along that Medicare and SSI were pay-as-you-go, not savings accounts.
Warren Buffet shouldn't be getting a social security check. Neither should a boat-load of other well and not-so-well known politicos, business folk and talking heads.
Including that former co-worker.
He could - and was - making a very good living off of his other income. At that point SS ceased being a safety net and became just another government handout.
See - I can tell the difference between the folks outlined above and the 75-year old widow that was a stay-at-home mom and whose husbands pension from someplace like Delphi was just decimated or eliminated.
Obviously, J. Strupp, like myself, has researched the Social Security issue including probably reading the reports of the SSA itself (which is non-partisan).
Simply said, all analyses show that Social Security will pay full benefits to all who qualify at least through the mid-2030s and will then pay 75-80% of benefits beyond that for decades IF ABSOLUTELY NOTHING IS DONE TO IT.
"There never were any personal savings accounts".
I don't know where this comes from, but ever hear of a 401(k)? IRA?
"There never was a lock box"
Should have voted for Gore.
"There never was a trust fund - it is a filing cabinet full of IOUs. Seriously."
Seriously? This statement alone proves that you have done no research on the subject. You are completely ignorant because you only listen to the Republican talking points.
The SS Trust fund is not some mythical concept. And it is not a drawer "full of IOUs". Do you or your parents have any US Treasury Bonds? You know, those pieces of paper backed by the full faith and credit of the United States? If you do then you also have a "drawer full of IOUs".
The Trust Fund was set up in 1983 to collect SS revenues that were higher than needed at the time and invest them in Treasuries so that there would be reserves when the baby boomers hit retirement. It is invested in US Treasuries.
This whole argument about how many workers it takes to support the baby boomers in retirement is meaningless. The Trust Fund was set up to take care of that.
There is ONE and ONLY ONE way that Social Security will not be available for our children and theirs: The Republicans dismantling it.
"Afterall, if you convince people that they'e not going to get any SS benefits, it's easier to get rid of it."
Absolutely effing correct!
"it's all about YOU, Jim!"
What an asshat statement, Dadio! It's about EVERYONE. I'm at the age where (supposedly) any changes will not affect me. Regardless, I will not live on SS alone, and I will in effect be "means tested" because I will pay taxes on my SS because of the other income that I will have from my "personal accounts". So it's not about me.
Mom said, "That needs to include lifting the cap on the tax past the $106K or whatever it is and then also means testing the recipients."
This is correct!! Raise the cap and SS will pay full benefits to the end of the century. Means testing is already happening in that recipients get taxed on SS depending on their total income.
Raising the cap is really a minor tweak yet it will make SS provide full benefits for decades beyond the currently estimated date. But when Perry calls SS a Ponzi scheme, a monstrous lie, and unconstitutional, he is not talking about raising the cap and means testing.
So why would you say, "Perry is accurate"?
You folks need to read real stuff when it comes to Social Security, then you'll know, for instance Mom, if you're 43, you'll be getting at least 75% of expected benefits if nothing is done. The only way you won't is if Rick Perry gets his way.
"Raise the cap and SS will pay full benefits to the end of the century."
And probably beyond since the dependency ratio stabilizes around 2038.
OK Jim and Strupp...
If the Trust Fund is so flush with assets, then why in July, were Obama and Geithner out there saying that if the debt ceiling wasn't raised, they couldn't guarantee that social security checks would go out?
Your options are the Obama Admin is lying through their teeth to try to scare everyone. But that can't possibly be true because only Republicans do that right?
Or...
The only way that would be true is if the $2.6T in the "Trust Fund" has already been spent, the fund is empty and they have to borrow to keep the money flowing to the recipients because they arent' bringing enough in to even stay afloat via the payroll tax.
Take your pick.
And for the record, I did vote for Gore in 2000. But I never believed his Lock Box nonsense.
Sorry, Jim, can't possibly respond to your entire unhinged rant.
The 'trust fund' has, indeed, been used as an off-books Fed spending scheme for years. Yes, it has T-bonds in the drawers, but the T-bonds aren't worth shit if the spending orgy continues. You DO know that the national debt is now in the mid-80's% of GDP, right?
(By the way, Samuelson AND Friedman referred to SocSec as a "ponzi scheme." But what do they know, right? Jim and Strupp are far better-informed than they.)
I know that the actuaries' society has suggested that SocSec can survive quite will with minor tweaks. Good!
However, Perry's purpose is to stimulate discussion. He succeeded. It ought to be had.
"I did vote for Gore in 2000. But I never believed his Lock Box nonsense."
Looks like it wasn't such nonsense now.
The Trust Fund assets are US Treasuries. SSA does not send a Treasury note to your mother. They send a check. The issue during the debt hostage negotiations was a matter of cash flow. SSA actually hasn't had to dip into the Trust Fund yet, but when they do, the will sell their Trust Fund treasuries to raise cash to make up the difference between current revenues and current benefits.
If you have bonds, stock or any financial instrument besides a checking or savings account among your family assets, your "trust fund" is "flush" too. But if your boss says he has a cash flow problem and has to delay your paycheck for two weeks, you won't be able to guarantee your due mortgage payment since it make take several days to sell your bonds or stock to raise the cash. Unless you get your credit cards to raise your credit limit.
I'd say it is fair to put some urgency into the situation. Either way, without having reached that point, it's hard to say that Administration claims were untrue.
"Samuelson AND Friedman referred to SocSec as a "ponzi scheme." But what do they know, right?"
They apparently don't know the definition of the word. A Ponzi scheme is a criminal enterprise.
"T-bonds aren't worth shit if the spending orgy continues."
That's correct. But that could only happen if the US cancelled all its debt. If that happens, SS will be the least of our problems.
"Perry's purpose is to stimulate discussion."
By referring to it as a criminal enterprise? By saying it's a monstrous lie? By calling it unconstitutional?
Some discussion!
Here's a very relevant article from The Economist.
Splitting hairs Jim. Take the criminality out of it and SSI is exactly like a Ponzi scheme. And personally, I think what the Feds have done with it and the lies they have told about it is criminal. I'd love to see some politicos doing a perp walk over all sorts of fiscal fraud.
That said, who is the Gov't going to sell the bonds to? In case you haven't been paying attention, the market for them ain't what it used to be. The biggest buyer is the Federal Reserve (monetizing the debt) and the only thing they seem to be hoping for as those printing presses keep humming is to inflate their way out of the problem.
That will work out just great for in a couple years won't it?
That will work out just great for *you* in a couple years...
Ponzi schemes depend on garnering an ever-increasing pool of new investors to pay out returns to prior investors. When the potential pool of new investors runs dry, they collapse.
Yah, sure. But no other Ponzi Scheme has the armament of IRS and the US military. Need more revenue? No problem!
conservatives wanted to replace it with a Chilean-style defined-contribution plan that would be invested in securities.
No longer the case, except in certain fever-swamps. The better plan: a hybrid w/ X amount guaranteed floor, Y variable from 401(k)-like instrument.
Advantage? The 401(k)-like instrument is the property of the contributor, unlike the SocSec "contributions" which you lose the moment you die. So do your heirs.
"In case you haven't been paying attention, the market for them ain't what it used to be."
You're correct. At no time in American history has the demand for U.S. debt been stronger. MAYBE the 50's. Probably not. Your statment is correct even though you don't know it. And Fed. debt purchases are not the reason yields are at historic lows. That's just wrong.
"Take the criminality out of it and SSI is exactly like a Ponzi scheme."
Or the fact that SSI has a constant revenue stream and a Ponzi scheme does not. Or the fact that Ponzi schemes collapse and SSI has no such future BECAUSE of it's steady revenue stream.
Yeah, other than the fact that SSI is a transparent, legal, pay-as-you-go program that has a steady revenue stream and has zero chance of collapsing, SSI is EXACTLY like a Ponzi scheme.
You said it, Strupp: pay-go.
That IS the tennis-elbow.
Ponzi schemes depend on garnering an ever-increasing pool of new investors to pay out returns to prior investors. When the potential pool of new investors runs dry, they collapse.
But we know that the pool of "investors" is going down. Just ask Mom. The Baby Boomer blip will be gone after a period of time. The SSA actuaries have accounted for all that.
How will the potential pool of new investors run dry? Nobody has a job? Or virus wipes out the entire population?
You've both conceded that minor tweaking is sufficient to "correct" the situation. Now you are simply arguing about what Perry said.
Perhaps we are getting to hung up on "Ponzi"... Maybe Strupp and Jim would like the definition of a pyramid scheme better:
"...in which people are recruited to make payments to others above them in a hierarchy while expecting to receive payments from people recruited below them. Eventually the number of new recruits fails to sustain the payment structure, and the scheme collapses with most people losing the money they paid in."
Of course we are "recruited" involuntarily by the Feds to pay in.
The demographics are showing a lot fewer folks at the bottom supporting those at the top. That baby boomer blip is about 30 years long. Not sure we can sustain Keynes that much longer. And people have caught on to the monetizing.
If you look above at my actual comment, I stated that solutions would need to include lifting the cap and means testing. I didn't indicate that would be all that was needed - because it isn't.
But back to the Bachmann topic of the thread. If she goes after Perry on this, she is completely finished.
Doesn't work either. Nothing "collapses".
Sure Strupp... See most of Europe to see what that "Nothing collaps[ing]" looks like.
Mom, you can trying to denigrate Social Security by picking names out of a hat. Ponzi scheme, pyramid scheme. Neither is accurate (pyramid less so than Ponzi).
Listen UP! The Social Security actuaries HAVE ALREADY ACCOUNTED FOR THE BABY BOOMERS.
"I stated that solutions would need to include lifting the cap and means testing."
You are correct. What should also be included is that people like you READ the facts. You keep repeating the same things that have been refuted by Strupp, me, and the links I have provided. You have provided nothing but the talking points.
I've provided links to SSA and The Economist above. What have you provided? Runes?
Yah, well, Jim, Neo and I are concerned about more than just the boomers, you know.
And by the way, we haven't mentioned cracking down on SS "disability" abuse--which is rampant--nor the extremely generous "spend-it-all" adders to SocSec emplaced by (D)-dominated Congresses since 1960 or so.
But that should be in the mix.
See, we expect the country to continue after 2038. You may not, Jim, but frankly, that's YOUR problem.
It's not a Ponzi scheme, because Ponzi didn't hit upon a means of forcing people to pay into his scheme or lose their homes; or their freedom; or both. Ponzi had to hide what he was doing; the government's power lets it do it in the open. This is much better, or much worse, than a Ponzi scheme. It's slavery: of the young to the old, and therefore -- as the young are almost always poorer than the old -- of the poor to the rich.
You keep arguing in a circle. EVERYONE including the SSA actuaries expect the country to continue after 2038. They've accounted for that. They go decades beyond 2038. Says right on the SSA FAQs:
"The projected point at which the combined Trust Funds will be exhausted comes in 2036— one year earlier than the estimate in last year's report. At that time, there will be sufficient tax revenue coming in to pay about 77 percent of benefits."
You are arguing the same unsupported arguments over and over again.
What are "spend it all adders"?
Jim,
There is no trust fund. It is pay as you go. But keep deluding yourself.
It is pay as you go EXCEPT for the assets in the Trust Fund accumulated SPECIFICALLY to cover the shortfall during the Baby Boomer years.
The FACT is that there IS a Social Security Trust Fund. The total assets in the SS Trust Fund as of year end 2010 is $2.4 Trillion. But keep holding your hands over your ears and yelling "la-la-la-la-la" as loud as you can.
Congressional Research Service report, May 5, 1998:
When the government issues a bond to one of its own accounts, it hasn't purchased anything or established a claim against another entity or person. It is simply creating a form of IOU from one of its accounts to another.
Office of Management and Budget under the Clinton Administration in 1999:
These [trust fund] balances are available to finance future benefit payments and other trust fund expenditures--but only in a bookkeeping sense. These funds are not set up to be pension funds, like the funds of private pension plans. 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.
And, of course, there's the little challenge, in 2043, of eliminating the rest of the national budget entirely to finance SoSe and Medicare.
I like how you slipped Medicare in there like SS and Medicare are one in the same in terms of future deficit projections.
Come on.
When the government issues a bond to one of its own accounts, it hasn't purchased anything or established a claim against another entity or person. It is simply creating a form of IOU from one of its accounts to another.
When a corporation issues a bond to anybody, it hasn't purchased anything or established a claim against another entity or person either. It's borrowing, not purchasing. Yes it is an IOU. As is a promissory note, a mortgage, or a T-Bill.
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.
Correct, just like the rest of the $14 Trillion national debt. The only way for those claims on the Treasury to not be honored is 1) the US defaults on it's Treasury bills or 2) the president and the Congress destroy Social Security so that the Trust Funds don't need to be honored.
And THAT, number 2, is likely the whole idea. The national debt can be reduced by $2.4 Trillion if the Trust Fund is simply abolished. Only the Republicans would do this, and I think that's probably the idea.
Problem is, if they claim that anybody 55 years and older will be kept whole and remain on the current system, that will basically require the Trust Fund which is there to provide funds for the boomers, most of whom are 55 and older.
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