When I discovered that Shakes, filling in over at Crooks and Liars, had linked to my post about Senator Obama and Social Security, I thought might get hordes of angry Obamaites*. Instead, what some of the comments repeated two common mistakes about Social Security (although thankfully other readers slapped them down)
The first fallacy is that Social Security is in crisis. It’s not. Let’s try this way of explaining it, since the other ways don’t seem to have worked (an aside: why do I even put hyperlinks in my posts? The conservatives either don’t bother to read them, or don’t know how to click on them). If in 2000, the Social Security Trustees announce that Social Security will be insolvent in 34 years, you would expect that the 2001 report should state that Social Security will be insolvent in 33 years. The 2002 report should claim that the program will be insolvent in 32 years, the 2003 report would claim insolvency in 31 years, and so on. Straightforward, yes?
Well, suppose the Trustees told you every year for fourteen years that Social Security would go bust in thirty four years, give or take (this is known as a Samuelson Unit). A member of the Coalition of the Sane might conclude that the Trustees are a wee bit, erm, pessimistic. And lookie, a picture (the bar graph on the right):
To not get this, you not only have to have funnel-chugged the Konservative Kool-Aid, but also undergone full-immersion baptism in it. As the post title states, the reality of Social Security has a liberal bias–it’s not a “progressive” plot (an aside: I’m a liberal, not a ‘progressive’). But enough of fucking morons who can’t read bar graphs. Let’s move onto a substantive, albeit flawed argument.
I noted in an another post (and virtually every other time I’ve ever discussed Social Security):
3) Social Security generates a large annual surplus (about 25% of revenues). That surplus doesn’t wind up under a mattress out at Area 51, but is used to purchase government securities, which, if need be, can be liquidated to pay out benefits (see point 4). Essentially, the government loans itself the surplus. Alternatively, think of the annual Social Security surplus as the world’s largest municipal bond issue… held by you. The real crisis is not the solvency of the program, but the drop in excess revenue that will most likely occur. That would affect the general (national) debt (and budget deficit obviously).
4) In the bad case scenarios, Social Security will no longer generate enough surplus revenue, and would probably have to dip into the Social Security surplus to pay out benefit. This would represent the U.S. liquidating the debt that it holds…in itself, raising the official U.S. debt (if you hold your own debt, it doesn’t really count as debt).
Now, a lot of well-meaning people will read that and conclude that we should either cut Social Security benefits or raise the cap on taxable income in order to solve the budget crisis. Personally, I think eliminating the cap on taxable income would be a good thing–if you’re going to have a regressive flat tax, at least tax all income with it. But that policy change is not required to prevent a non-existent Social Security ‘crisis’ (see the above pretty picture). There are plenty of other policy changes–budget cuts in other programs and other tax increases–that can be used to reduce the budget deficit. For instance, not invading the wrong fucking country might be a good start. Just a thought.
This is the critical point: to address a general budget crisis, a program that has lifted millions of elderly, orphans, widows, and disabled out of poverty should not be weakened. To this fourth generation Democrat, that is a core value of the Democratic Party, not to mention the prophets Amos, Isaiah, and Jeremiah.
If Democrats don’t stand for our signature program–a program that has defined Democrats for the better, then what’s the point of having Democrats at all?
*Doesn’t one version of the Ten Commandments say that you shall not make a covenant with an Obamaite? Or maybe it’s a Jebusite?