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Republicans Are Trying to Destroy the Most Successful Government Program in History
The top 1% have been waiting their turn on Wall Street for many years now, patiently awaiting the day when their bible-thumping, gay-bashing, gun-toting and embarrassingly uninformed constituency will deliver them a presidency, house and senate majorities and the requisite right-wing courts that will open the floodgates to trillions upon trillions of your dollars and mine to their upturned palms until earth flames out.
It’s the grandest prize in all the political realm and it goes by the name of Social Security. And the Romney-types want to pry it from the hands of the government and deliver it to the green-tinted (tainted?) canyons of the Street to the eager clutches of venerable bank/brokerage money-houses.
Though a blue dress stain delayed a proposed step toward semi-privatization in a deal worked out between Bill Clinton and Newt Gingrich, the DINO president did give the scheme some momentum in the late 90’s. Republican successor, Bush eagerly embraced it and expanded upon it.
Social Security has been with us for over three-quarters of a century (passed in 1935; it became fully operational in 1939) and has worked beautifully for all that time and will continue to serve us in our old age and disabilities with the simple steps of raising the maximum earnings amount where employees and employers have to contribute a payroll tax into the Federal Insurance Contributions Tax Act (FICA). The current maximum is $110,100 a bump from the most recent $106,800. It should continue to climb as average salaries increase. It should also be doubled tomorrow. Social Security can tap into outside government funding sources as well. These sources plus a realistic tax increase (as in pre-Bush tax rates on the wealthy) and more ‘chop, chop’ in the absurdly bloated military budget would protect the trust fund as long as need be. It wouldn’t hurt if the government kept its paws off the trust fund as well.
In the 2005 State of the Union speech, newly re-elected President George W. Bush revealed Republican plans for social security ‘reform’ in some detail. Bush established the template for millionaires and billionaires to add exponentially to their lucre. These are some of his exact words; “…a half century ago, about 16 workers paid into the system for each person drawing benefits. It wouldn’t be a Republican speech without at least 1 blatant lie. The actual figure from 1960 was 5.1 workers. But that’s not nearly as frightening as tripling the real number.
Bush continued, “…we must join together to strengthen and save Social Security. For younger workers, the Social Security system has serious problems that will grow worse with time. He pointed out that today people are living longer and therefore benefits “are scheduled to rise dramatically over the next few decades.”
He threw out all sorts of unsupported numbers. Social Security will pay out more than it takes in by 2018; in 2027 the government will need to scare up $200 billion to keep the system afloat; by 2042, the whole kit and kaboodle will be “exhausted and bankrupt.” I’m exhausted just listening to his BS.
But, BS aside – Bush claims there’s a fix out there – voluntary personal retirement accounts. “Here is why the personal accounts are a better deal: Your money will grow, over time, at a greater rate than anything the current system can deliver.” Thus Spake Bush. Still a little hesitant? “We’ll MAKE SURE the money can only go into a conservative mix of bonds and stock funds.” Phew, what a relief. Funds are sure to appreciate no doubt. Just like the Dot-Com funds of the roaring 90’s. They appreciated like crazy. Venture capitalist were buying up companies designing new mouse pads with their international headquarters in their bedroom closets. What an era. The NASDAQ hit 5,048.62 March 10, 2000. Hello new millennium.
Then the Dot-com Bird of Paradise flew into the closed window of stock market reality. A bear market of gargantuan proportions rose up overnight. In just over two years some five trillion in market value was lost.
NASDAQ plunged to an intra-day low of 1,108 in October of 2002. Amazon went from $107 to $7.00 a share. Cisco lost 86% of its market value. It took seven years for the composite to recover just half it’s peak value. Even today, it’s not that much over half. Sure it’ll eventually recover, but how close will you be to retirement age?
Still want to play the privatization game? OK, hand your money over to Bernie Madoff. He relieved investors of about $65 billion all by himself. Bottom line, you can invest on your own any damn time you feel like it and not risk one penny of your Social Security. And, there are always 401k’s and lots of companies will sell employees their own stock if you’re a big believer in their future.
The current 112th congress has H.R. 1104 Privatization Act of 2011 floating around somewhere right this minute. The bill estimates the net gain from privatization will be $10-$20 trillion dollars. Sounds about right for the legislator’s investment cronies fees. The same cronies who load up legislative campaign coffers. A $10 trillion estimate differential shows they’re just pulling this one out of their a**. It’s also stated that the number of workers to pay for baby boomers is not increasing. Really? Rounding off, in 1980 there were 227 million souls in the U.S. In 1990, that number was 250 million; It was 281 million in 2000 and the Census Bureau puts the number at almost 312 million in 2011. No new workers? Surely Romney and company can’t send that many jobs overseas.
The real calculation is that Republicans expect wages to be comparatively lower if they get their way. So it’s not the paucity of workers, it’s the paucity of wage increases.
The goal is to eventually eliminate the FICA tax and allow workers to designate a certain amount of their pay to be invested privately. They will be no longer be ‘forced’ (as stated in the bill) to pay into the Social Security fund.
Don’t know where H.R. 1104 has gone. Maybe still snoozing in Ways & Means or it could be dead and buried. There was also a later privatization bill introduced by a Michigan Representative, Thad McCotter. It was H.R. 2889 and it seems lost in the shuffle as was McCotter who had an eye on the Republican presidential nomination at one time.
As for Mitt Romney; he’s enthusiastically supported privatization; he’s cautiously opposed it. This much we do know. He wants to reduce Social Security benefits and increase the age of eligibility. Guys worth a quarter of a billion can afford to make those sacrifices.
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33 Responses to Republicans Are Trying to Destroy the Most Successful Government Program in History
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Ebony.
May. 19th, 2012 at 5:37 pm
They’re so full of shit!!!!!
Reynardine
May. 19th, 2012 at 5:50 pm
I bet that even if they do away with the Social Security system, they’ll never do away with the ID numbers they need to keep track of us, though. Oh, no. The internal passport will become a necessity of life- literally. I can see where those who can’t produce the national ID for every transaction could wind up disappeared.
buckeyewill
May. 19th, 2012 at 6:30 pm
Your SS Number IS YOUR ID NUMBER!!!
Even IF the Republicans give away the system to “Gansta Bankers” to loot, the number will follow you like Mary’s little lamb.
Remind the politicians…NO TO PRIVATIZATION!!!
Claude Pepper would be totally upset if he were alive today.
A Walkaway
May. 19th, 2012 at 10:18 pm
Claude Pepper… (laugh)… now there is a name I haven’t heard in a few years…
That he would!
myne
May. 20th, 2012 at 8:59 am
Superannuation in Australia is widely regarded as a successful policy to replace social security. It was actually first suggested by Milton Friedman in ‘Capitalism and freedom’.
Social security numbers are but one of many. Getting rid of that isn’t going to do a hell of a lot. Licences, tax file numbers, medicare cards, etc etc all exist and would be roughly equivalent.
Lindsay
May. 20th, 2012 at 5:46 pm
“Superannuation in Australia is widely regarded as a successful policy to replace social security.”
It has been wildly successful for fund managers and investment brokers but an absolute disaster for blue collar, casual and itinerant workers.
froggyalley
May. 19th, 2012 at 5:53 pm
Will employers be required to contribute towards social security and medicare as they do now, or is that another 7.65% back in their corporate fatcat pockets?
DannyEastVillage
May. 19th, 2012 at 6:20 pm
again.
Deborah Montesano
May. 19th, 2012 at 6:55 pm
The title could read “Republicans Are Trying To Destroy Government” (period). Protection for the people only means one thing to them: not being able to garner all of the country’s resources for themselves.
mediawest
May. 19th, 2012 at 7:22 pm
sen sanders, and thom hartmann have been talking about this for years. wall st, and the GOP shills in the congress, are drooling over the trillions they want to subjugate for their own evil purposes….
if the GOP arent attempting a coup d’état, then what is it?
Shiva (Moderator)
May. 19th, 2012 at 7:27 pm
Maybe we should start attaching ss taxes on the wealthy. lets see how long before they decide its good to hire people
After all wouldnt jesus want them to take care of the poor before themselves?
JJM
May. 19th, 2012 at 7:53 pm
The GOP believes that every penny of tax money is ‘waste fraud and abuse’ if it isn’t going straight into their pockets.
Larry
May. 19th, 2012 at 8:14 pm
I’ve said it before and will say as often as I can. Don’t vote for republicans, period. If no one ever elected these losers the world would dramatically improve with that simple act alone. Don’t vote a single republican to any office.
Ken
May. 19th, 2012 at 8:26 pm
they have been planning this since 1935 and now may have their best shot if they win the Senate and McChinless kills the filibuster. also, on the Medicare side, Ryan’s voucher plan means that FICA taxes will have to go away or people will revolt. Taking away that, those still on Medicare will have their monthy rate for part B double and the part A deductible will go from about $1018 today to $1-5K per year. They want Medicare to rot on the vine due to lack of funding. If the worse case happens, a repug tri-fecta, they will also pack the SCOTUS with at least two more right-wing idiots to screw us for the next 40 years. Remember, Romney has Robt Bork on his staff. This is the most important election is US history.
Reynardine
May. 19th, 2012 at 10:02 pm
It is surely the most important since Lincoln/Breckenridge.
sherrie heckendorn
May. 20th, 2012 at 3:52 pm
You are so correct, and that bork charactor is really really out there, and scary. We all need to vote this year, and make sure everyone we know votes and that we all vote straight democrat so we can have a chance to reclaim our government into a government for the people. Social Security and Medicair are both solvent, and even if the revenue stayed as is now, will be solvent way into the 30′s and if you remove the ceiling stays solvent, well forever. Raise medicair taxes just a little and it also stays solvent for ever. Anytime that the republicans have forced privatization it costs us the taxpayer more, because now the money made goes to a corporation that will use loopholes to pay next to no taxes, and they will use a good portion of that tax money for compensation, so in the end we the taxpayer lose all the way around. Of course, the repub’s want to privatize, because that way they can line their corporate owners pockets, Just my thoughts
Swiggy
May. 19th, 2012 at 10:32 pm
Let’s get this straight: the conservatives that have pushed every bill through the house and senate to make the American workers paupers and their cronies rich beyond belief believe that privatization is the only answer. The problem with this is that, unless they also do away with the welfare system, which they also want (except for the various corporate welfare programs their cronies receive) But it may take longer to get rid of the welfare system. So everyone puts their money into these voluntary private accounts. Then along comes the next financial crisis and more and more people wind up on welfare. What’s the first thing you have to do to qualify for welfare? (even food stamps) Get rid of you stocks, bonds, 401K,IRA’s, any investment package that you have. (only company paid pension programs are exempt) If you are lucky enough to HAVE some money invested, then the financial crisis will wipe it out either thru Wall Street or banking manipulation.
While JP Morgan Chase has announced that the $2B loss was not depositor money, that $2B was investor money. Of course, such losses will ripple out throughout the financial community. Don’t think so? Look at yesterdays Facebook IPO. Ended up the day only 23 cents higher than the starting price (I pity anyone that bought a few thousand shares @ $42/share… they lost $3 a share before the end of the day)
Not everyone in this country is a financial genius: if they were, then everyone would be billionaires. Most people want to make a decent living, have a nice home of their own, a car, raise some kids, and even help those in need. Corporate America is not set up for those simple dreams, only make the biggest bang for the biggest investors.
Shiva (Moderator)
May. 19th, 2012 at 11:25 pm
They say it doesn’t effect people but it affects a everyone who has a retirement fund in the market that dropped because of them
Philip
May. 20th, 2012 at 4:39 am
So the congress can do it, and countries like here in Australia can have privately run pension plans, but you Americans as a whole can’t? Is it because you can’t trust the intelligence of too many Americans? Do they lack the discipline? The knowledge? As they say, ‘that’s so racist’.
Churchlady
May. 20th, 2012 at 1:41 pm
So how secure are your “private plans”? We have them, and we saw them nose dive several times over the last decade. People were totally wiped out of basics, and lots of seniors wound up losing homes and apartments and living in crappy trailers. We KNOW they don’t work here. If yours are regulated, ours would not be. Congress under the GOP do not believe in regulation. Same with health insurance – France, Germany, Switzerland have universal coverage but via private insurance that is HEAVILY regulated. We have UNregulated insurance under the GOP’s wet dream – which puts it already out of the reach of almost all seniors and many who are not covered at work.
So do tell how you avoid being wiped out in the series of downturns we experience. We lost hugely in 1987, 2000, 2008 just to name the most recent catastrophes. If you’re regulated, then please don’t pound the drum for privatization because it’s NOT what the GOP envision for us. And then count your blessings if you’re stable where we are not.
sherrie heckendorn
May. 20th, 2012 at 3:56 pm
The problems lie with putting our money into the hands of private entities, then you can lose everything, if they invest wrong or if they commit fraud. Government agencies contrary to what the repubs would have you believe, actually have less overhead and the money that is invested in providing employees and the money comes back to the government. When you privatize it, then its no longer non-profit and its a for profit program, which means less of our tax money goes for the purpose it was designed. The reason the repubs push privatization is not for the benefit of the taxpayer, no its for the corporations that will hugely benefit from this transaction as they laugh all the way to the bank at the ignorant citizens
Thomas W
May. 20th, 2012 at 5:46 am
Calling Clinton a DINO, is not the way to communicate with centrists or independent (swing) voters.
In this Right-leaning country, Democrats must make a *much* better effort to embrace & communicate with even the hard-core right.
Good article — but writing articles that only connect with people who already agree, is not enough.
StratPark.com
A Walkaway
May. 21st, 2012 at 12:57 pm
Embrace the “hard-core right”???
I’m not going to become evil so as to get along with evil.
If you’re talking about dominionists, it’s been known for a long time that it is impossible to convince them, and since they’re anti-freedom (and liberals/progressives are centered on the concept), there is little discussion to be had.
Jason Light
May. 20th, 2012 at 6:46 am
Republicans being republicans… Defense budget? let’s increase that by billions while cutting taxes. They should be conservative on everything, not only when their friends are getting kickbacks.
Steven
May. 20th, 2012 at 10:35 am
I typically avoid posting on useless rants, except for the fact that everyone has missed your plans to solve this problem. Your plans are a) increase taxes b) cut defense spending c) DOUBLE the amount each person contributes and then continue to increase it over time. I believe C especially goes against Democratic code.
You are correct that average salaries have gone up, but you miss that so has the contributions. The problem has and always will be, maintaining the level of income versus distributions. In combination with each individual’s 4.2%, a company provides an additional 6.2% or 10.4% of your income. The average monthly payout is currently $14,760 a year. (ssa-custhelp.ssa.gov/app/...) – See I know how to fact check ;)
As of 1990 (latest SSA estimates), the average male lives 15.3 years over 65, or receives benefits 18.3 years (since 62 is when you can start). That means over that course of time, you would receive $270,108. A modest $40,000 salary would contribute $4,160 a year over say 37 years (assuming you started making 40000 at 25 and didn’t get a raise). You would contribute only $153,920 which is nearly $120,000 less than you contributed that you’re taking out. The government has no way to grow this income because it owes more than it has, and continually takes money out of Social Security funds (which means, the government has to come up with the money it owes the “bank” before you can retire or borrow it from China at high interest rates). This figure gets worse when you realize women live an additional 4.1 years.
That being said, if you invested this income into the stock market (using mutual funds) and received over the course of the 37 years a meager 4% annual return (the average over the 30 year period is slightly less than 8%) your stock value is $371, 232. It’s things like this the government can’t do: they can’t grow some money into more money, and they’re fools for thinking they can. This was designed as a temporary program and needs to be redone, otherwise I’ll see nothing for my investment of income.
Until you can devise a smart way to pay for your plan (because remember, these defense cuts & tax increases are also going to pay for the Medicare reform, the Health Care reform, and anything else you can devise), then your argument is completely useless. And if you listened to Bush, it was an optional choice a person could make, similar to putting your money into a 401k. Nobody would be forced to do it, but it would allow you to, in theory, increase your payouts.
Hate on a party as much as you want, but your arguments are no better than Rush Limbaugh (which is, not worth the 500KB disk space on this website).
Shiva (Moderator)
May. 20th, 2012 at 11:20 am
Funny I didnt see any of “his” plans like double what everyone con tributes. COuld you be making assumptions? Like basing your controverted argument on one persons history?
Sorry, your post doesnt work. You obviously know nothing about SS
sherrie heckendorn
May. 20th, 2012 at 4:05 pm
I also check my facts, so am aware that the social security program is not only solvent but stays solvent, and as the report from social security says the only danger is that in the 30′s, if and this is a big if, revenue stayed low, then without raising payroll ceiling it would pay 75%, but raise the ceiling it stays solvent,and medicair solvent and has only a 3.5% overhead. The only reason they want to do this is to make the corporate and wall street people money, not to help the people, Wake up and really look at the republican plans and see if it will help you in anyway. Our media is allowed legally to lie, misinform and slant the news. When the report came from social security he begged the reporters not to exagerate and mislead on the figures, well you see how well they listened. Research is everything, but you need to always question is this the truth or mis-information
Jack H
May. 20th, 2012 at 10:59 am
Let’s see…
On the verge of bankruptcy.
Keeps all your money, instead of letting you pass it on to your heirs, when you die.
Pays a lower rate of return than passbook savings accounts at the bank.
Is a completely regressive (i.e., affecting lower-income workers more than high-income workers) form of taxation.
Would be prosecuted as a pyramid/Ponzi scheme if run by a private citizen.
And this is “the most successful government program in history”? Says as much as ever need be said about why we should get government out of as much as possible. :-)
Shiva (Moderator)
May. 20th, 2012 at 11:16 am
You forgot to add has saved millions of peoples lives.
Its not a ponzi scheme, thats a RWNj description
Your money goes into a fund that pays to everyone.
Yes, the most successful government program in our history.
What are you, 16?
Sarah
May. 20th, 2012 at 11:23 am
It’s not just the older and/or elderly and/or retired people who depend on SS for their livelihoods!
I depend on SSDI for paying for my medical care, managing my disability, and paying my bills. I’d be destitute and homeless if SS is taken away, unable to manage my disability, and I’m sure I wouldn’t last long. If Republicans have their way and take SS away from disabled people, too, there are going to be more deaths, more people on the streets, more people unable to LIVE.
“Pro-life,” my effing foot!!!
Churchlady
May. 20th, 2012 at 1:35 pm
I never forget the 2008 cry from one person heavily invested in a private “retirement” plan:
“My 401K is now a 201K!”
The operative word in Social Security is Security. The GOP plan is anything but. Why older people would like this is beyond comprehension. It you take out all the younger folks, the last man standing in Social Security is screwed.
It’s not a Ponzi scheme, but it is “stone soup” where everyone puts something into the pot of water, and everyone gets what they need – soup. Take out 3/4 of the population, and the last person up to the kettle gets…nothing.
Yup – THAT’s an improvement.
John Casey
May. 21st, 2012 at 1:03 am
When will people finally realize that the dream of retirement is just the dream that is placed before us, like a carrot, to get us to accept giving up our freedom, working and giving way more than half our wages to greedy governments and corporations who continue to find new ways to screw us. For those of us who don’t have our heads up our ass and read a news paper, watch the news or take a moment every now and then to objectively look at the world around us, you know what I mean, you see our rights being eroded year after year.
We all hear the lovely story of people who finally make it to retirement and travel the world or move to Provence to retire. Those are the few who have won the lottery. For the vast majority, that carrot turns into a stick. Many work like a dog for many years in a stressful job only to die before retirement. Many diligently pay their taxes and then put every scrap the government allows them to keep into some retirement fund only to have it wiped out when the market turns bad. What most don’t know is that money is never destroyed in these situations, it merely switches from the hands of the hard working retirement hopefuls to the greedy rich. Then they are forced to work every day until they lay down permanently, never being able to enjoy the fruits of their labor. Others retire on just enough to sit around waiting to die.
I read a book years ago about accepting working until the day you die. I remember thinking, well that’s a little morbid and silly. As years passed, every time I heard about companies stealing retirement funds and/or no longer offering retirement benefits, I would think back to the book. Every time I heard about people’s retirement savings getting wiped out, I would think back to the book. Every time I would hear about someone dying within years of their retirement or see them living out their retirement sitting in their little apartment with little food and no air condition in the middle of the summer, I would think back to the book.
I’d rather work one day less a week and act like I am retired while I am young and healthy than wait until maybe I can retire when I am old, ill, tired and in pain every day. I’d rather live and enjoy 50-60 years than suffer through 70-80.
All of a sudden, compared to the alternative, the ideas in the book did not seem so morbid to me. As a matter of fact putting my life on hold, believing in the retirement lie, now seemed morbid. I was already somehow naturally on track, perhaps the book had more of an impact on me than I initially thought. I already had an easy career that I made lots of money in that I could see doing until I died. I spent and enjoyed what I earned. I give as little as I can to the government and steal whenever I can from greedy corporations, and I sleep like a baby.