The Truth about Social Security
Posted in the Paragould Forum
“Ignorance is not Patriotism.”
Since: Dec 11
#1 Jan 27, 2013
Protect Social Security
This efficiently run government program, which returns 99 cents on each dollar collected, will give full benefits until 2043. Social Security is a safety net that more than 52 million Americans depend on. It does not add to the deficit and cannot be subjected to the whims of the market through privatization.
What Happened to Social Security and Where Do We Go from Here?
Social Security was created as a compact between the government and the people as a way to protect Americans from poverty in their retirement. FICA taxes paid by American workers were intended as an investment in their financial security. Social Security was to be administered by the government on the peopleÂs behalf. That was the plan!
But Social Security has been plundered. What happened starting in the Reagan-Bush administrations is a violation of federal law. The peopleÂs money was not invested; it became part of the governmentÂs overall operational budget. Contributions poured into Social Security every day and were spent every day. This is the cause of the dilemma we are in now.
How Did this Happen? In 1983, the 15% increase in the FICA tax was meant to provide for the upcoming baby boom generation. It was implemented to assure coverage through 2040 when the Social Security Trust Fund was to be re-examined and adjusted if necessary. The amount of money that poured into the coffers of Social Security created a surplus, leaving plenty left over each month to invest.
Instead, the $500,000,000 each day that comes in for Social Security is added to overall government spending. This use of the Social Security surplus as a way to hide deficit spending started under President Reagan and continued under President George H.W. Bush.
Under ClintonÂA Budget Surplus President Clinton continued the practice during his first term in office, but in his second term, the government stopped using surplus Social Security funds and there was a concerted effort to protect them. During the last two years of the Clinton administration, Social Security was not violated and, with the help of other financial policies, a genuine surplus of the governmentÂs operational costs existed.
ClintonÂs courageous economic plan reversed 12 years of supply-side economics and led to fiscal responsibility, eventually erasing the deficit and creating a surplus that totaled $86.4 billion in 2000. The prosperity we enjoyed during the Clinton years was a return to sound economic principles.
It should be noted that under President Clinton, the Budget Reconciliation Act passed the Congress in 1993 without a single Republican vote!
Under BushÂA Return to Fiscal Irresponsibility When George W. Bush came into office, he was determined to return to the trickle-down economics of Reagan/Bush. The 2001 and 2003 tax cuts enacted by the Republican congressional majority and the Bush administration are responsible for the financial crisis we are in nowÂ helped along by CongressÂs earlier repeal of the Glass-Steagall Act, which allowed commercial banks to merge with investment banks, opening the door to the financial meltdown.
George W. Bush spent $1.37 trillion of Social Security surplus revenue during his eight years as president. In his last year alone he spent $526 million of our Social Security money each day.
So much for the republicans "we are the fiscal responsible, less government spending party"
#3 Jan 27, 2013
Let's see, suppose you run an investment firm, like Edward Jones or Raymond James, and you proposed a retirement program to your clients that offered a negative 1% growth rate. How many investors do you think you'd attract? Probably about zero.
Now if you think receiving 99 cents for every dollar you invest, decades after you invested it, is a good thing, by all means put your faith and trust in government socialist programs.
Most of us are smart enough to realize that negative returns on investment and decades of compiled inflation will render the initial investment almost worthless at the time when it's needed.
You can see now why seniors buy $0.25 cans of dog food to eat. That's all they can afford.
Actually it does add to the deficit, and has since 2010 when FICA tax revenues were insufficient to cover the benefits being paid out. Even the left slanted factcheck.org admits that:
As far as "the whims of the market" goes, as I pointed out earlier, if you think a 1% negative growth rate is a wise investment, then you'll like the government socialist retirement plan. All you need to do is acquire a taste for canned dog food - you're going to need it.
Smart people will invest in almost anything else. Even as bad as the stock market has been over the last few years, over time it still astronomically outpaces the negative 1% growth rate of the SS fund.
Well, that was the spiel, but as noted above it actually puts retirees in poverty when they could be enjoying a much higher standard of living if they were allowed to invest their money with say Edward Jones or Raymond James and receive a 5% growth rate rather than a negative 1%.
Government found a way to usurp power and in doing so violated the Constitution when it implemented socialist programs like Social Security.
Yes, our lawmakers did raid the trust fund and left us with nothing but IOUs. But let's be clear, that money wasn't being invested. It was just sitting there earning a whopping 0%, and it's value was slowly being eroded by inflation. And after deducting the overhead, that's why we see a negative 1% growth rate.
Of course that doesn't make stealing that money was okay, but your inference that because the Democrat Congresses during the 1980s decided to violate the law and raid the kitty caused that money not to be invested is wrong. It wasn't being invested anyway.
#4 Jan 27, 2013
Invested in what? That money was never invested, unless you want to consider government IOUs as investment. But then, that's the same thing as robbing the kitty and leaving an IOU where there was once a pile of money.
I know you leftists like to blame everything on Republican presidents, but let's be clear about the facts. Only Congress has the power over the nation's finances. They pass the budgets and they appropriate every federal dollar that is spent. And during the presidencies of Reagan and GHW Bush, Congress was controlled by Democrats. They are at least as much responsible, if not more so, than either Reagan or GHW Bush.
Oh brother. I don't know why this idea of a Clinton surplus continues to be bandied about. There was no surplus. Every year Clinton was in office, the national debt grew. That only happens when spending outpaces revenues, and it's called a deficit not a surplus.
Another fact to consider. After Clinton's first two years in office, Republicans finally gained control of Congress after decades of Democrat rule. Through the hard work and earnest efforts of men like John Kasich and Newt Gingrich, they passed 4 balanced budgets in a row. Of course that was only on paper, and during those years the deficit did climb, but it was miniscule compared to the massive deficits we've seen since 2006 when Democrats regained control of Congress.
Uh, no. It wasn't Clinton being either courageous or having a sound economic plan. It was the fact that fiscal conservatives controlled Congress and thus the nation's purse strings. Daddy finally grabbed the credit card from the teenager and cut it up.
Give credit where credit is due. Congress wields all of the government's power over the economy. The President has none.
Yep, but only after the 1994 elections when Republicans gained control of Congress and began implementing sound economic principles.
That's blatantly false. Those tax cuts were enacted at a time when our economy was rocked in the aftermath of the 9/11 attacks, and they were designed to spur economic growth. And they worked magnificently, spurring 54 straight months of solid economic growth. Unemployment remained under 5%, and government revenues rose to record levels year after year.
It was only after Democrats regained control of Congress after the 2006 elections and began implementing their failed socialist polices that our economy went to shit.
Again, let's stick to the facts.
Actually, Bush didn't spend that money, it was Congress. You need to brush up on Article 1 Section 8 of the Constitution and understand that it is Congress alone who has the power to appropriate all federal government spending, not the President.
#5 Jan 27, 2013
Well said. I don't know who you are but I'm sure if we met in person we would get along. Seems common sense isn't very common. Shut these liberal idiots up.
#6 Jan 27, 2013
Why do you seem to base your opinion of Social Security on the idea that every penny that someone has to invest is going to Social Security? In reality, it is a very small percentage, for a sure-thing safety net. Peace of mind in a safety net for the future is worth a few cents on the dollar, and no one on Social Security has to eat 25 cent cans of dog food, unless they are choosing to blow the rest on an expensive house and car that is way above their means, etc.
Please provide something besides strawman arguments.
#7 Jan 27, 2013
Another truth about Social Security is that if you become disabled or live long enough to draw it, then you draw much more than you ever paid in, and so it really isn't a negative return investment personally for those end up needing it.
#8 Jan 27, 2013
The President has none? That isn't true. The President has lots of power over the economy. He can veto what Congress passes, and he can let them know beforehand what is acceptable to him or not. I don't know why you always insist on acting like all of the branches of government are ignorant of the other.
#10 Jan 27, 2013
The meds to stay alive? Did you miss the Medicare prescription drug program? Go ahead and tell me how seniors are forced to get meds from vets for their pets and take them and all of that. I don't think so. What was that about bs?
Social Security benefits are calculated based on your 35 highest-earning years in the workforce, and are adjusted for inflation, and not your last 7 years like you said.
But, with low paying jobs and so therefore paying little into Social Security compared to what they draw, are you really saying that your parents would have been better off without Social Security? Really?
#12 Jan 27, 2013
Logical conclusions from what you have said. Not guesses.
#13 Jan 28, 2013
I don't. Buckwheat cut and pasted an article extolling the supposed virtues of Social Security's negative 1% growth rate. I merely exposed the underlying idiocy of that mentality.
The problem is that no one has a choice. Over my working years I was forced to pay over $150k into Social Security, and that amount was matched by my employers. And what will I get in return? About $1200 per month.
Any ding dong with an investment calculator can very easily figure out that a $300k investment over a 45 year time span, even with a very conservative 3 or 4% rate of return, will generate an enormously better retirment than $1500 per month.
Like I said in my response to Buckwheat, anyone with half a brain would not willingly invest their money in a retirement plan that offers a negative 1% growth rate. You lose money every single year, plus the value decreases every day because of inflation. It's sheer idiocy.
The only reason people invest their money in Social Security is because they are forced to.
As far as starving seniors go, ask yourself if you could pay your rent, make your car payment, buy insurance, pay utility bills, buy food, buy medication, and buy any number of other necessities like clothes, laundry detergent and toothpaste, all on $1200 per month.
Hell,$1200 per month is barely above the national poverty level.
ROFLMAO! Strawman arguments? Please.
Tell ya what, why don't you prove to me that investing $300k over a 45 year time span and receiving $1200 per month is a good deal? Can you do it?
#14 Jan 28, 2013
We have private companies that offer disability insurance policies that are a far better deal.
Again, if people were given a choice, Social Security would collapse because no one would willing invest their money in such a losing venture.
#15 Jan 28, 2013
No, he doesn't. Read the Constitution.
Article 1 Section 8 gives solely to Congress the power to regualte commerce, the power to coin money and regulate its value, the power to borrow on the credit of the U.S., the power lay and collect taxes, etc.
Article 2 Section 2 lists the powers of the President, and none of them have anything to do with the economy.
I don't. I just know what the Constitution says. When the far left tries to blame every economic problem on Republican presidents and credit every economic success to Democrat presidents, I know it's nothing but unfounded bullshit because the fact is that the office of president has zero power over the economy.
As I told you, all economic powers of the federal government are solely that of Congress. Our form of government was specifically designed that way.
#16 Jan 28, 2013
Medicare prescription drug program, Part D, is not part of the monthly premiums every senior pays for Medicare. It's a supplemental insurance policy that also comes out of that $1200 they receive, and averages about $40 per month.
Part D plans don't cover every dollar of the cost either. They all have copays, some of them very high for certain drugs, plus they all have annual deductibles that must be met before they cover prescriptions at 100%. Those deductibles are typically $2500 or so. That means another $50 bucks per month. And if a senior reaches the donut hole, they have to pay 100% of the cost of their drugs until they are out of pocket even more money.
So out of that $1200 you deduct $100 for Medicare part A & B,$40 for part D,$50 toward your part D deductible, and you're left with a little over $1000 per month.
Can you pay your rent, make your car payment, buy renters and car insurance, pay utility bills, and buy food for $1000 per month?
I can't speak for the other poster's parents, but I know damn well I could have a far, far better retirement on a $300k investment with 45 years to mature than a measley $1200 per month. Any monkey with a calculator can figure that one out.
#17 Jan 28, 2013
If you have paid that much into Social Security, then you have obviously had a very high income and you probably don't even need it. It isn't meant to make people like you money. You are subsidizing the safety net of others. Get over it, and stop trying to dishonestly get average Americans to take up your cause as their own. It isn't. For the vast majority of Americans, if they live long enough to draw Social Security or need to draw Disability, then they draw much much more than they ever payed in, and they would be in a very bad place without it. Get over yourself.
#18 Jan 28, 2013
If someone is living off of Social Security or Disability and doesn't have an astronomical amount of assets (or maybe even if they do idk), then they pay virtually nothing for any drug under the Medicare prescription drug program, plus or minus the relatively nominal monthly premium which there are subsidies for as well. That's a fact that I know. You can say otherwise, but then you are either ignorant or lying. If you want to argue that that isn't a beneficial program for seniors, then you are simply off your rocker.
#19 Jan 28, 2013
Yes I can. Rent, car insurance, utility bills, and renters insurance very cheap (though I never felt the need for it). In fact I have before for years at a time, but for other reasons. People do every month. That's an indisputable fact. Though hopefully someone on Social Security has their house paid off, and that reduces a lot of the bills. No reason for a $500,000 mortgage in Paragould. You can get a decent house for $50,000. Also, I've never had a car payment. Good used cars are plenty sufficent, and much more economical. We aren't all rich you know. Step down out of your ivory tower if you are.
#20 Jan 28, 2013
...the car I have now only cost $1,500 over three years ago with only two breakdowns since, both issues relatively inexpensive to fix, which is typically my experice...
#21 Jan 28, 2013
If people were given a choice, then Social Security very well might collapse, though not because it is a loosing venture for the vast majority of those who utilize it, but rather because of the shortsightedness of twenty more bucks or whatever a week -- and then a whole lot of people who would need it would be in a very bad place one day.
#22 Jan 29, 2013
That's not a fact. Traditional Medicare does not pay anything for prescription drugs at all. Medicare Part D is a supplemental insurance program with an additional premium, and there are copays for every prescription, some of them quite high.
I am saying otherwise because I know the facts, your petty ad hominem attack notwithstanding.
Again, being forced to invest money in a program that returns a negative 1% every year is nothing but idiocy. I don't know how to describe those of you who try to make others believe it's a good deal. Snake oil salesmen?
#23 Jan 29, 2013
Bullshit. Rent is at least $600 per month, a car payment at least $250, utilities at least $150. That's the whole $1000 right there and we haven't even gotten to food, insurance, household necessities, etc.
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