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Opinion
White House Social Security 'fact sheet' is anything
but
By Robert Weiner, former chief of
staff, House Aging Committee
Feb. 25, 2005 - Last week's White House fact sheet
on Social Security contains anything but the facts. It asserts that by
2027 the government will somehow have to come up with an extra $200
billion a year, and by 2033, more than $300 billion.
The "Strengthening Social Security for Future
Generations" report goes on to predict that by 2042, "the system will be
bankrupt."
Federal Reserve Chairman Alan Greenspan also
overstated the problem when he told the Senate Finance Committee this
month that benefits would "strain the resources" of Social Security by
2008 but ignored the ongoing Social Security Trust Fund surplus through
2052.
None of these assertions is true, yet this
unfounded fear is the basis of the proposal for so-called reform. The
Claude Pepper Foundation, headquartered in Tallahassee, recently found
that 54 percent of Americans think they will not even get as much as
they paid in, and most think Social Security can't pay more than 20
years of current benefits.
The reality, according to the Congressional Budget
Office, is that the Social Security Trust Fund covers the program fully
through 2052. Perhaps President Bush wants to spend the annual surpluses
for other programs and to cover up the deficit for all other federal
programs - some $500 billion annually including Iraq war costs.
Moreover, there will be no Social Security
bankruptcy in 2042 or even in 2052. President Bush's 2042 figure is
based on the Social Security Trustees' two-year old estimate that the
Trust Fund will be able to cover 73 percent of benefits in that year.
The Congressional Budget Office, reflecting somewhat more current
economic improvements, states that 80 percent will be covered in 2052,
more than now, factoring in inflation. Further economic improvements
could stop any shortfall.
Regardless, even if the CBO or SSA figures were to
become accurate in 40-50 years, Congress could easily then cover all or
part of the difference or make any changes to the program at that time
to deal with any potential shortfall. It would not be the big deal Bush
is making it out to be.
In addition, the baby boomer factor so often cited
by Bush and Greenspan is a short transitional matter. The boomers aren't
booming with babies themselves. Their own parenting rate of 2.1 per
woman (1970-2000) is the lowest rate in history, according to the
National Center for Health Statistics. This low birth rate will also
then represent the lowest drain on the Social Security Trust Fund ever.
The system will go back into a huge surplus
because of the need to pay fewer beneficiaries. What we really have is a
solvable "blip" followed by a totally secure system.
Under pressure, the president has altered his words
from just a month ago of "crisis" and "private accounts," changing them
to "problem" and "personal accounts." The camouflage does not alter this
Wall Street give-away proposal, which would put trillions into the
coffers of the brokerage and banking companies whose executives gave $38
million to Bush's two presidential campaigns and $6 million to his last
inaugural, according to the Center for Responsive Politics and Public
Citizen.
But the facts are beginning to take hold, and the
"reformers," whom I view as the destroyers, appear to be beginning to
cave. Former House Speaker New Gingrich asserted the Republicans in
Congress could lose the majority over the White House proposal.
Current Speaker Dennis Hastert added, "You can't
jam change down the American people's throat unless they perceive there
really is a problem."
Now Bush is saying he won't even put forward a
formal proposal; he wants Congress to do it.
Clearly, the president and the reformers are now
flailing, and Democrats were right during the State of the Union speech
to draw a line in the sand and yell "No!" when the president said Social
Security is going bankrupt.
House Democratic Leader Nancy Pelosi, D-Calif.,
Minority Whip Steny Hoyer, D-Md., and new Democratic National Chairman
Howard Dean told me they are ready to respond to proposals on a
bipartisan basis, but only after the Republicans change the hyperbolic
mentality and discuss the problem rationally.
There are proposals that Democrats could accept -
such as using a portion of the tax cuts for reducing the Social Security
deficit only if and when there is one, or reinvesting the current Social
Security Trust Fund surplus - $145 billion a year - into the very kinds
of private funds the president proposes, and use the profit down the
road if a trust fund deficit occurs.
These proposals, rather than imposing benefit
reductions or altering the successful program, would honor Minority
Leader Pelosi's ground rule, Hippocrates' oath, "First, do no harm."
Robert Weiner was chief of staff of the House Aging Committee under
Chairman Claude Pepper, D-Fla., director of communications of the House
Government Operations Committee. He now heads a Washington public
affairs think tank and can be contacted at
weinerpublic@comcast.net.
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