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May 23rd, 2006Girl Scouts for Saving Social Security?
May 23rd 04:55:20 PM
On the lighter side of the news, an article in the St. Louis Post-Dispatch recently covered one man's idea of saving Social Security by selling Girl Scout cookies.
Jerry Zezima devised the plan as a way to help bring the ailing retirement system back in to fiscal health:
Then it dawned on me that a lot of money in this country is spent on Girl Scout cookies and school fundraisers. This is why parents never have any cash. So if only a fraction of the money collected by Girl Scouts could go toward Social Security, the system would never go bankrupt.
Jerry goes on to describe some of the problems he faced implementing his plan:
"Wanna buy some cookies?" I asked as potential customers walked past. Most of them either didn't answer or, refusing to make eye contact with me, mumbled something about already having bought some.
While Jerry's plan didn't pan out, it was an innovative alternative to traditional plans. We applaud Jerry for his initiative and call upon Congress implement a solution to the crisis we face. While they don't seem to want to sell Girl Scout cookies, perhaps they could at least keep their hands out of the cookie jar and stop raiding the Social Security Trust Fund.
For the full story, click the link here.
Posted by Patrick Wetherille| Comments (0)
May 22nd, 2006Congress votes to give Social Security benefits to Illegal Immigrants
May 22nd 03:19:52 PM
In a 50-49 vote (1 abstaining) late last week, the United States Senate voted to table (kill) an amendment (SA 3985 Voting Records) by Senator Ensign (R-NV) that would prevent illegal aliens from collecting Social Security benefits on past illegal employment.
Majority Leader Frist (R-TN) has this to say about the amendment:
Social Security is a compact between generations of American citizens. And we all know that the solvency of Social Security is seriously in question. That's why I strongly supported the President's plan for Social Security reform. And that's why I believe that illegal immigrants who work in America with forged papers and false Social Security numbers should not qualify for the benefits owed to hard-working Americans.
Moreover, when illegals use false numbers, the American who possesses that number may face tax liability based on that illegal work, IRS audits, and numerous credit problems.
So, Senator Ensign proposed an amendment to the immigration reform legislation on the Senate floor that would guarantee that illegal aliens cannot accumulate credit to qualify for Social Security using false Social Security numbers.
On the other side, Senator Kennedy (D-MA), says:
"Their money sits in the Social Security Administration waiting to be matched with an eligible beneficiary, and once those workers establish the eligibility, how in all fairness can we deny them the credit for their past contributions?" asked Sen. Edward Kennedy, a Massachusetts Democrat.
This is only one more of many examples that illustrates that you don't own your social security contributions. You get what Congress feels like giving you. And if they choose to give part of it to someone else, you have no recourse.
Regardless of where one may fall on the issue, I'm sure we can all agree that if we had a system of Personal Retirement Accounts that included ownership of social security contributions, we wouldn't have to have this debate.
For further reading, see:
Posted by Jeremy Tunnell| Comments (0)
They are asking: tell AARP about PRAs!
May 22nd 11:54:07 AM
This month's issue of AARP Magazine is asking for AARP members to write in with stories about how adults help children with money problems.
This is our chance! S4 would like to ask all of our senior and adult supporters to write to AARP and tell them about how the current Social Security system is bad for young Americans and is creating financial problems for youths now and in the future.
Here is the link where you can write in your stories, and consider including some of the following points:
- The current system cannot afford to pay your grandchildren the benefits they have been promised.
- Payroll taxes are so high, young workers do not have enough disposable income to save for retirement in other ways.
- Raising taxes to "fix" the current system will slow economic growth and cut worker's salaries, making it impossible for young people to support themselves.
Also, don't forget to tell AARP that personal accounts--the reform plan they tried to kill last year--are a great way for young Americans to save.
- Personal accounts give young Americans retirement savings they own and control.
- Personal accounts yield high returns to ensure today's youths will be economically independent when they are ready to retire.
- Personal accounts are the solution young people want because it is the only reform plan that gives them control over their income and savings.
Please help us by sending AARP your stories about how PRAs help your grandkids today!
Posted by Nicola Moore| Comments (0)
Thanks, Joe.
May 22nd 10:46:00 AM
Paul Krugman's latest New York Times op-ed, "Talk-Show Joe," critiqued Senator Joe Lieberman for (among other things) the Senator's stance on Social Security. Krugman claims:
Mr. Lieberman repeatedly supported the administration's scare tactics. "Every year we wait to come up with a solution to the Social Security problem," he declared in March 2005, "costs our children and grandchildren and great-grandchildren $600 billion more." This claim echoed a Bush administration talking point, and President Bush wasted little time citing Mr. Lieberman's statement as vindication. But the talking point was simply false, so Mr. Lieberman was providing cover for an administration lie.
The main problem with Krugman's argument is that it just plain wrong. First of all, the "$600 billion" figure that is the estimated cost of a year of inaction is NOT a Bush administration figure. This statistic is computed by the Social Security Administration and reported in their non-partisan Trustees Report. Here's the exact quote from the SSA (in trillions instead of billions of dollars):
In last year's report the unfunded obligation over the infinite horizon was reported as $11.1 trillion in present value as of January 1, 2005. The change to the later valuation date for this report, January 1, 2006, tends to increase the measured deficit by about $0.6 trillion.
This quote makes a second problem with Krugman's statement clear: the figure was not and is not a "lie." In fact, in a 3/11/05 op-ed Krugman gave credence to figures computed by the Social Security Administration. When speaking of last year's Trustees Report Krugman admitted "I don't expect to see books that are literally cooked: Stephen Goss, the [Social Security] agency's chief actuary, has an excellent reputation."
If there is anyone misleading the public about the severity of problem with the current system, it is "Talk-Show Paul", and Krugman would do well to thank Senator Lieberman for the Senator's honest willingness to discuss a severe policy problem.
With all this mud slinging across and on the same side of the aisle, it is no wonder the Social Security reform debate keeps hitting so many blockades. But at S4, we will at least thank Senator Lieberman for recognizing the current system is creating an enormous problem for future generations and invite Mr. Krugman to start writing honestly about the reform debate.
Posted by Nicola Moore| Comments (0)
May 19th, 2006Editorialist comes out of retirement to write about Social Security
May 19th 01:07:13 PM
In the 1950's, the New York Times used to publish editorials written by "McCandlish Phillips". After so many years, Mr. Phillips (Now John M. Phillips), has submitted an Editorial to the National Review.
In it, the author, an admittedly unlikely Bush supporter, says that Personal Accounts are absolutely the right way to go.
Mr. President, I know in my heart, my gut, and my mutual-fund balance that you are dead-on right about those private retirement accounts for Social Security. You are. You are. And those who don't admit it are fools or, more likely, political knaves.
To give you the opportunity to read this excellent editorial, S4 has reproduced the article in its entirety (with permission) Here (page 1) and Here (page 2).
Posted by Jeremy Tunnell| Comments (0)
May 16th, 2006Karl Rove on the economy and Social Security
May 16th 09:40:55 AM
Karl Rove spoke at AEI yesterday on the subject of the economy, taxes, and spending. He managed to devote a considerable amount of time (taking into account the current political atmosphere) to entitlements and entitlement reform.
What does one gather from his remarks?
The President is still committed to fixing our looming entitlement issues.
And while the topic of entitlements is beyond the scope of my prepared remarks this morning, I will point out that no president has made a more concerted or determined effort to reform Social Security, our nation's largest entitlement. The president encountered enormous resistance to what were bold but practical reforms.
I believe there will be a price to pay for the political intransigence which some showed to this reform agenda. But President Bush will continue to keep entitlement reform front and center on the nation's political agenda.
If you would like to watch it, there is a video recording over at AEI (Video) and a transcript at RealClearPolitics (Transcript)
Be sure not to miss the Question and Answer session after the speech.
Posted by Jeremy Tunnell| Comments (0)
May 15th, 2006Does it take a commission?
May 15th 03:35:17 PM
We already reminded you that President Bush renewed his commitment to Social Security reform during his State of the Union address this year when he called for a new commission to study entitlements. Today, the Concord Coalition hosted a panel discussion on whether such a commission was necessary to solve the crisis.Speakers included Dr. Charles P. Blahous, the Special Assistant to the President for Economic Policy; Former Representative Charles Stenholm; U.S. Comptroller General David Walker; Stuart Butler of The Heritage Foundation; Maya MacGuineas of the New America Foundation; Joseph Minarik of the Committee For Economic Development; Isabel Sawhill of The Brookings Institution. With experts from such diverse political backgrounds, the surprising conclusion that emerged was that they all agreed "yes, it takes a commission."
As was noted, the first baby boomer will be eligible to retire in just 2 short years, causing the fiscal crisis of entitlement programs to accelerate rapidly beginning in 2008. The panelists argued that a commission is the best way to get politicians to get their heads out of the sand for a few reasons.
- The political climate today has become so polarized, a bipartisan commission could help ease tensions and give politicians cover during the 2006 elections.
- A second-term president who is not facing reelection is in a unique position to tackle politically risky issues suck as entitlement reform.
The panelists also cautioned that the financial crises facing Social Security and Medicare make it critical this commission does not end up having its reccommendations ignored. To ensure a genuine report is issued and followed, a few of the suggestions made were:
- Any and all ideas for reform must be brought to the table.
- Representative from both parties and outside experts must all be involved in the process in order to represent all perspectives.
- The final reccommendations of the commission must call for action--possibly even imposing penalties on Congress for inaction
There was one interesting lesson from history that was left unsaid today, but was pointed out by Dr. Blahous in a lecture at the American Enterprise Institute: all past Social Security reform commissions--even those which broke up without issuing an official report--have all at least agreed on the fact that personal accounts are a viable solution.
So, if there is a commission, it could bode well for both the fiscal policies governing entitlements and personal accounts. As always, we'll keep you posted on what develops.
Posted by Nicola Moore| Comments (0)
May 12th, 2006AARP is not about age, it's about money!
May 12th 12:13:34 PM
We've already exposed some of the myths behind AARP's 35million membership claims, but here's one more:
AARP will accept anyone of any age a member so long as he or she knows how to write and has got $12.50.
After some FORTUNE editors managed to sign up people who were age 40 and even age 22, AARP's chief operating officer, Tom Nelson, admitted they would even sign up 7 year old:
"I don’t know how good his handwriting is. But if he sent in an application and put his birth date down accurately, we'd say to him, 'Grandson, you can be an associate member, but that's it.'
Sorry retirees: it looks like your "senior advocacy group" is about to be hijacked by a bunch of teenagers. Makes you wonder who AARP will sell out to next...
Posted by Nicola Moore| Comments (0)
May 11th, 2006Ken Mehlman says Social Security reform is coming back...
May 11th 03:41:38 PM
Ken Mehlman was a guest on Glenn Reynolds' (of Instapundit fame) podcast today.
Among the topics talked about were taxes and immigration, but Mehlman keeps coming back to Social Security reform. Give it a listen, and notice that he revisits the issue about three or four times.
Could this be fair warning that President Bush will revisit the issue sooner rather than later?
Click here to listen (mp3)
Posted by Jeremy Tunnell| Comments (2)
May 10th, 2006Stock Market at record highs...opportunities missed
May 10th 03:41:38 PM
Splashed across the front page of Drudge today is the news that the Dow Jones Industrial Average is poised to break its all-time record.
That's certainly good news, but just imagine if we had converted Social Security over to a system of personal accounts in the early '80s reform and allowed people to invest them in index funds. Say, like the DJIA:
Posted by Jeremy Tunnell| Comments (0)
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