Top 5 Myths About Social Security

[Chickadee]

moveon.org:

I just got an email from my sister which included this information. So I went and looked up the source. It's from June of this year an as far as I can tell moveon.org was the original source. I did a search here on the site and did not find that it hand been posted/discussed.

What are your opinions about this? Why would they be putting out "positive" information about Social Security? I thought the administration's current plan was to use Social Security AGAINST the Republicans.

Help Save Social Security

Social Security is under attack. Conservatives who want
to cut benefits are using these myths to scare people.
Join our campaign to fight back against the lies.

Top 5 Social Security Myths

Rumors of Social Security's demise are greatly exaggerated. But some powerful people keep spreading lies about the program to scare people into accepting benefit cuts. Can you check out this list of Social Security myths and share it with your friends, family and coworkers?
Facebook Twitter Email


Myth: Social Security is going broke.

Reality: There is no Social Security crisis. By 2023, Social Security will have a $4.3 trillion surplus (yes, trillion with a 'T'). It can pay out all scheduled benefits for the next quarter-century with no changes whatsoever.1 After 2037, it'll still be able to pay out 75% of scheduled benefits--and again, that's without any changes. The program started preparing for the Baby Boomers retirement decades ago.2 Anyone who insists Social Security is broke probably wants to break it themselves.

Myth: We have to raise the retirement age because people are living longer.

Reality: This is a red-herring to trick you into agreeing to benefit cuts. Retirees are living about the same amount of time as they were in the 1930s. The reason average life expectancy is higher is mostly because many fewer people die as children than did 70 years ago.3 What'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.4 But those intent on cutting Social Security love this argument because raising the retirement age is the same as an across-the-board benefit cut.

Myth: Benefit cuts are the only way to fix Social Security.

Reality: Social Security doesn't need to be fixed. But if we want to strengthen it, here's a better way: Make the rich pay their fair share. If the very rich paid taxes on all of their income, Social Security would be sustainable for decades to come.5 Right now, high earners only pay Social Security taxes on the first $106,000 of their income.6 But conservatives insist benefit cuts are the only way because they want to protect the super-rich from paying their fair share.

Myth: The Social Security Trust Fund has been raided and is full of IOUs

Reality: Not even close to true. The Social Security Trust Fund isn't full of IOUs, it's full of U.S. Treasury Bonds. And those bonds are backed by the full faith and credit of the United States.7 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. President Bush wanted to put Social Security funds in the stock market--which would have been disastrous--but luckily, he failed. So the trillions of dollars in the Social Security Trust Fund, which are separate from the regular budget, are as safe as can be.

Myth: Social Security adds to the deficit

Reality: It's not just wrong -- it's impossible! By law, Social Security funds are separate from the budget, and it must pay its own way. That means that Social Security can't add one penny to the deficit.1

NOTE: Sources are listed at the end of the article.

[Argyle58]

Myth: Social Security is going broke.

 

Reality: There is no Social Security crisis. By 2023, Social Security will have a $4.3 trillion surplus (yes, trillion with a 'T'). It can pay out all scheduled benefits for the next quarter-century with no changes whatsoever.1 After 2037, it'll still be able to pay out 75% of scheduled benefits--and again, that's without any changes. The program started preparing for the Baby Boomers retirement decades ago.2 Anyone who insists Social Security is broke probably wants to break it themselves.

 

According to the CBO, GAO as well as every credible independent review of the Social Security system, this paragraph is patently false. This statement is a bit of sophistry based on the way the Social Security Trust Fund (a joke) is invested. (see below)

 

Myth: We have to raise the retirement age because people are living longer.

 

Reality: This is a red-herring to trick you into agreeing to benefit cuts. Retirees are living about the same amount of time as they were in the 1930s. The reason average life expectancy is higher is mostly because many fewer people die as children than did 70 years ago.3 What'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.4 But those intent on cutting Social Security love this argument because raising the retirement age is the same as an across-the-board benefit cut.

 

Again, patently false. If one leaves out the infant mortality rates and only take into consideration life expectancies from age 65 forward from 1930 through 2005 Men increased from an average of 11 years from 65 in 1930 to 18 years in 2005. Similarly, women increased from 12 years to 20 from age 65.

 

Myth: Benefit cuts are the only way to fix Social Security.

 

Reality: Social Security doesn't need to be fixed. But if we want to strengthen it, here's a better way: Make the rich pay their fair share. If the very rich paid taxes on all of their income, Social Security would be sustainable for decades to come.5 Right now, high earners only pay Social Security taxes on the first $106,000 of their income.6 But conservatives insist benefit cuts are the only way because they want to protect the super-rich from paying their fair share.

 

I don't know of anyone who is talking about cutting Social Security Benefits. Some clearer heads have spoken about limiting the INCREASE in benefits to actual increases in cost of living, instead of an automatic 3.5% increase per year. As to increasing the income level on which Social Security taxes are assessed, that would probably be acceptable to most, as long as a reciprocal raise in the maximum allowed benefit to be received is also instituted. Currently, the maximum benefit allowed is $2,346 per month.

 

Myth: The Social Security Trust Fund has been raided and is full of IOUs

 

Reality: Not even close to true. The Social Security Trust Fund isn't full of IOUs, it's full of U.S. Treasury Bonds. And those bonds are backed by the full faith and credit of the United States.7 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. President Bush wanted to put Social Security funds in the stock market--which would have been disastrous--but luckily, he failed. So the trillions of dollars in the Social Security Trust Fund, which are separate from the regular budget, are as safe as can be.

 

While it's technically true that the Social Security Trust Fund is full of Treasury Bonds, one must consider that these are a special issue of bonds that are UNFUNDED until the time comes to redeem them. In order to redeem these bonds, they must be funded, meaning that funds must be borrowed from other sources to make good on them. If that is not an IOU, then what is?

 

 

Myth: Social Security adds to the deficit

 

Reality: It's not just wrong -- it's impossible! By law, Social Security funds are separate from the budget, and it must pay its own way. That means that Social Security can't add one penny to the deficit.1

 

If the Social Security Trust Fund was operated according to statute, this would be true. However, it is not. By investing Trust Fund proceeds in Treasury Bonds, whether tradition bonds or "special issue" bonds, they still represent debt, upon which interest must be paid. So much debt, in fact, several administrators in the past have refused to invest Social Security funds in Treasury Bonds for that reason. The debt service on these investments adds significantly to the deficit.

 

NOTE: In checking out the sources for the article I noticed that all, with one exception, are either web sites or books managed or written by Uber Leftists. The one exception is the Social Security Administration itself, which has been an example of misinformation and propaganda since its inception.

[AceRimmer]

This is another desperate Hail Mary pass by the RATS to scare seniors, who've already turned against them because of Obambicare, to turn around and vote for Pelosi and Reid's troops. Too bad, too sad, but they're just now figuring out the political cost of ramming that socialist garbage down everybody's throat...

[pollyannaish]

I think the strategy in question is to scare seniors into believing that everything is fine UNLESS the GOP makes cuts and/or privatizes social security.

 

So in other words—trust us its fine unless those guys get a hold of it.