Dear Michael,
I see you’re back to your ranting about Social Security. In Tuesday’s column you wrote about GOP Congressman Paul Ryan’s Roadmap for America’s Future.
Social Security comes in for particular abuse. Ryan states that “Social Security’s shrinking value and fragile condition pose a serious problem. . . . To maintain the program’s significant role as a part of the retirement security safety net, Social Security’s mission must be fulfilled . . . without bankrupting future workers.”
One doesn’t want to be picky about an elected congressman’s words, but with all due respect, these words are pure bilge. They come straight from the talking points of Social Security’s historical enemies: conservatives who have never believed that the government should play such an important role in people’s retirement planning, and mutual fund and insurance companies that hanker for the business generated by millions of Americans looking for a profitable place to park their retirement assets.
Golly, why would anyone think that?
Take my own example: my wife is a teacher and thus exempt from Social Security. Even though she has worked 12 fewer years than I, and even though the state teacher’s retirement fund (CalStrs) lost 1/3 of its value since the meltdown, she is still on track to receive twice as much per month as Social Security will pay me.
Conclusion? Social Security is a bad deal — it pays a stinking 3% return. Any stock fund with those results would be out of business.
Chile once has a system like ours (Ponzi scheme), but hired an American economist to help them convert to a mandatory, private system. Today, even the lowest peon in Chile has assets. Assets he can use for retirement or leave to his heirs.
You mock President Bush for trying to modify our system to let young people invest a small portion of their Social Security contribution into an index fund. But you and your Democrats — the party of No — threw a tantrum.
By the way, even when the program starts paying out more in benefits than it collects in payroll tax, that’s not a “crisis,” as it’s often portrayed — it’s the expected outcome of changes implemented after 1982, when the tax was raised sharply to provide a cushion against the coming wave of baby-boomer retirements. The accumulated surplus in the program’s trust fund at the end of 2008 was $2.4 trillion.
Michael, do you really think we’re that gullible?
Yes, there is a file drawer with IOUs from the federal government for $2.4 trillion owed to SS. But the feds are deep in the red, so how can they make good on the debt? By taxing people who still have jobs!
Seriously, how can debt owed by one arm of the government to another be counted as an asset?
You might not care, but I have kids and grandkids who will be stuck paying this off. I guess that’s just the price we pay for folks like you who make a fetish of government control.
Yours,
Jim Bass