Tuesday, March 08, 2005
A Breakthrough on Social Security Misunderstanding !
This article in today's The New York Times : At Heart of Social Security Debate, a Misunderstanding is a Breakthrough in public recognition of the basic facts of Social Security in a Main Stream Media outlet. Congratulations to David Rosenbaum for telling the awkward facts about the illusionary "Trust Fund" and the need to raise real money as soon as the "PayGo" system brings in less FICA revenue than it needs to pay benefits - an event that will occur in 2018.
This article confirms the facts as I've been posting them here. What is new is to see them reported on the pages of the NYT along with a number of revealing quotes. For instance:
* " said Senator Charles E. Grassley ofIowa
* ""The Social Security trust fund has produced more bad public discussion than any other budget entity," said Douglas Holtz-Eakin, director of the Congressional Budget Office. The truth, Mr. Holtz-Eakin said, is somewhere in between. The trust fund is more than an empty promise, he said, and less than a solemn obligation backed by the full faith and credit of theUnited States
* "Its importance, said John C. Rother, the policy director of AARP, the advocacy group for older Americans, is largely symbolic. "It is a symbol of the insurance nature of the program and the social contract that lies behind it," Mr. Rother said.
These admissions in the NYT should have some serious impact in the debate about reform. The first and key issue for moving to reasoned discussion of Bush's reform proposal is to get people to understand that there really is a Social Security problem and that it is a Now problem; this article helps greatly. It also helps for the AARP representative to admit that the Trust Fund is "largely symbolic" and that is does not bind Congress or insure anyone's benefits. I've been saying the same thing and asserting that as the Big difference between the current trust fund and personal accounts.
Personal accounts are real personal assets, owned by individuals, and not subject to Congressional whims; they are the ultimate "Lockbox", protected as individual property rights under the Constitution. In contrast, the trust fund only holds "special" bonds that are "less than a solemn obligation backed by the full faith and credit of theUnited States
This article confirms the facts as I've been posting them here. What is new is to see them reported on the pages of the NYT along with a number of revealing quotes. For instance:
* " said Senator Charles E. Grassley of
* ""The Social Security trust fund has produced more bad public discussion than any other budget entity," said Douglas Holtz-Eakin, director of the Congressional Budget Office. The truth, Mr. Holtz-Eakin said, is somewhere in between. The trust fund is more than an empty promise, he said, and less than a solemn obligation backed by the full faith and credit of the
* "Its importance, said John C. Rother, the policy director of AARP, the advocacy group for older Americans, is largely symbolic. "It is a symbol of the insurance nature of the program and the social contract that lies behind it," Mr. Rother said.
These admissions in the NYT should have some serious impact in the debate about reform. The first and key issue for moving to reasoned discussion of Bush's reform proposal is to get people to understand that there really is a Social Security problem and that it is a Now problem; this article helps greatly. It also helps for the AARP representative to admit that the Trust Fund is "largely symbolic" and that is does not bind Congress or insure anyone's benefits. I've been saying the same thing and asserting that as the Big difference between the current trust fund and personal accounts.
Personal accounts are real personal assets, owned by individuals, and not subject to Congressional whims; they are the ultimate "Lockbox", protected as individual property rights under the Constitution. In contrast, the trust fund only holds "special" bonds that are "less than a solemn obligation backed by the full faith and credit of the
