{"id":2273,"date":"2010-08-15T09:51:06","date_gmt":"2010-08-15T17:51:06","guid":{"rendered":"http:\/\/www.fogcityjournal.com\/wordpress\/?p=2273"},"modified":"2017-05-28T15:53:39","modified_gmt":"2017-05-28T23:53:39","slug":"social-security-if-it-aint-broke-dont-fix-it","status":"publish","type":"post","link":"https:\/\/www.fogcityjournal.com\/wordpress\/2273\/social-security-if-it-aint-broke-dont-fix-it\/","title":{"rendered":"Social Security:  If It Ain&#8217;t Broke, Don&#8217;t Fix It"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-2274\" title=\"social_security\" src=\"http:\/\/www.fogcityjournal.com\/wordpress\/wp-content\/plugins\/2010\/08\/social_security.jpg\" alt=\"\" width=\"180\" height=\"146\" \/><\/p>\n<p><strong>By <a href=\"http:\/\/www.fogcityjournal.com\/wordpress\/author\/rstone\/\">Ralph E. Stone<\/a><\/strong><\/p>\n<p>August 15, 2010<\/p>\n<p>Privatization of the Social Security program (Program) has raised its ugly head again. The annual report of the trustees of Social Security (Report) states that, because of high unemployment, the Program will pay out more this year than it collects in payroll revenues.  If the current rate continues, the report goes on to say, the Program&#8217;s reserves will be exhausted in 2037.  Of course, no one can predict the path of the US economy between now and 2037.  If we have a series of boom years, the annual reports for the next several decades might show a reversal of payouts versus payroll revenues.  Seizing on this Report, the Republicans are threatening to revive efforts to privatize Social Security if they gain control of Congress.<\/p>\n<p>There are many untrue myths about Social Security that have been floating around for years.  The organization MoveOn.org provides &#8220;reality&#8221; answers to five of these myths (&#8220;Top 5 Social Security Myths&#8221;).    The first old myth has been seized upon again in light of the release of the recent Report.  That is, Social Security is going broke.  As MoveOn notes, by 2023, Social Security will have a $4.3 trillion surplus. It can pay out all scheduled benefits for the next twenty-five years with no changes whatsoever. After 2037, it will still be able to pay out 75 percent of scheduled benefits without any changes. Why?  Because the Program started preparing for the Baby Boomers retirement decades ago.<\/p>\n<p><!--more-->The second myth states that the US will have to raise the retirement age because people are living longer.  This is simply untrue.  Retirees are living about the same amount of time as they were in the 1930s. The reason average life expectancy is higher is largely because fewer people die as children than they did 70 years ago.  What&#8217;s more, what gains there have been are distributed very unevenly.  Since 1972, life expectancy increased by 6.5 years for workers in the top half of the income brackets, but by less than 2 years for those in the bottom half. Raising the retirement age would be the same as an across-the-board benefit cut.<\/p>\n<p>The third myth states that the only way to fix Social Security is to cut benefits.  But as indicated above, if Social Security ain&#8217;t broke, don&#8217;t fix it.  However, if the US wants to strengthen Social Security, a better way would be to make the wealthy pay their fair share. Right now, high earners pay only Social Security taxes on the first $106 thousand of their income.  If the very rich paid Social Security taxes on all of their income, Social Security would be sustainable for decades to come.  But conservatives insist that benefit cuts are the best solution because they want to protect the super-rich from paying their fair share.<\/p>\n<p>The fourth myth states that the <a href=\"http:\/\/en.wikipedia.org\/wiki\/Social_Security_Trust_Fund\">Social Security Trust Fund<\/a> has been raided and is now full of IOUs.  This is simply not true. The Social Security Trust Fund isn&#8217;t full of IOUs.  Rather, it contains US Treasury Bonds backed by the full faith and credit of the US.  The reason Social Security holds only treasury bonds is the same reason many Americans do: The federal government has never missed a single interest payment on its debts.  Remember when President Bush wanted to put Social Security funds in the stock market, which, given the recent financial crisis, would have been disastrous. Luckily, he failed.  Thus, the trillions of dollars in the Social Security Trust Fund, which are separate from the regular budget, are as safe from stock market ups and downs.<\/p>\n<p>The final myth states that Social Security adds to the deficit.  Untrue.  By law, Social Security funds are separate from the budget, and it must pay its own way. That means that Social Security cannot add to the deficit.<\/p>\n<p>We may need to strengthen an already solid Social Security program but one thing we must not do is privatize it.  If the Democrats are smart, they will use this Republican threat to privatize, to shore up their standing with retirement-age voters, which make up about 40 percent of those who vote in midterm elections.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>If the current rate continues, the report goes on to say, the Program&#8217;s reserves will be exhausted in 2037. Of course, no one can predict the path of the US economy between now and 2037. If we have a series of boom years, the annual reports for the next several decades might show a reversal of payouts versus payroll revenues. Seizing on this Report, the Republicans are threatening to revive efforts to privatize Social Security if they gain control of Congress. <\/p>\n","protected":false},"author":1230,"featured_media":2274,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19,17],"tags":[],"class_list":["post-2273","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opinion","category-politics"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Social Security: If It Ain&#039;t Broke, Don&#039;t Fix It - Fog City Journal<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fogcityjournal.com\/wordpress\/2273\/social-security-if-it-aint-broke-dont-fix-it\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Social Security: If It Ain&#039;t Broke, Don&#039;t Fix It - Fog City Journal\" \/>\n<meta property=\"og:description\" content=\"If the current rate continues, the report goes on to say, the Program&#039;s reserves will be exhausted in 2037. Of course, no one can predict the path of the US economy between now and 2037. If we have a series of boom years, the annual reports for the next several decades might show a reversal of payouts versus payroll revenues. 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Stone\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@fogcityjournal\" \/>\n<meta name=\"twitter:site\" content=\"@fogcityjournal\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Ralph E. Stone\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.fogcityjournal.com\/wordpress\/2273\/social-security-if-it-aint-broke-dont-fix-it\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.fogcityjournal.com\/wordpress\/2273\/social-security-if-it-aint-broke-dont-fix-it\/\"},\"author\":{\"name\":\"Ralph E. 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