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Home Publications Blogs Beat the Press It's Open Season on Social Security!

It's Open Season on Social Security!

Sunday, 01 August 2010 19:27

That's right folks, you get to say whatever you want in the media now to further the cause of cutting Social Security. Today on This Week, Cokie Roberts told viewers that:

"You could close this capital or turn it into condos and you could close down every domestic program that we have and you would still have a deficit because of Social Security and Medicare and interest on the national debt."

Well that's not quite right, Social Security is running an annual surplus. The money that program takes in each year in taxes and interest on its bonds exceeds what is being paid out in benefits. It's not clear what Ms. Roberts had in mind when blaming Social Security for the deficit, but it has nothing to do with reality.

Thanks to Gene Devaux who watched so I wouldn't have to.

Comments (13)Add Comment
written by izzatzo, August 01, 2010 9:55
It's not clear what Ms. Roberts had in mind when blaming Social Security for the deficit, but it has nothing to do with reality.

Maybe it would have made more sense if hubby Steven Roberts had appeared with Cokie Roberts to provide as support, the same comments of alarm he offered so objectively as a reporter on NPR some weeks ago, about how the deficit was expected to reach $1.5T this year and $5T by the next decade and added rather breathlessly that no one was doing anything about it.

Uh huh. Like these two so-called reporters of everything that happens at the end of the parade after it's already passed, were right on top of the bubble from beginning to end, and the deficit popped up with a surprise increase that caught them totally off guard. Whoever said traditional reporters are threatened needs to explain why the worst ones go out last.
written by Doug O'Keefe, August 02, 2010 12:00
Cokie Roberts wasn't on This Week this week. And I might point out that This Week has now allied connected itself to a factcheck organization, which is, of course, much needed in media punditry.
written by @joely, August 02, 2010 12:16
Here's another recent piece of inuendo journalism on Social Security:

written by @joely, August 02, 2010 12:18
Oops, that's " innuendo."
written by vorpal, August 02, 2010 1:01
Well, Dean, you can't expect expert on national politics to know everything about every little govt program.

Cokie dough can only hold so many chips of info.
written by Benedict@Large, August 02, 2010 1:22
Would someone please start talking about Modern Money Theory, and how it demonstrates that deficit hyping is nonsense?
The cash flow into social security is temporary.
written by AndrewDover, August 02, 2010 7:41
Yes, Social Security's current cash flow is positive, but actuarially it is running a 2% of payroll deficit. http://www.socialsecurity.gov/...index.html

This is simple to understand. There is a lump in the population distribution which is only starting to retire now. As the lump moves from paying payroll taxes into getting social security payments, social security will move into a negative cash flow situation, and empty the trust fund somewhere around 2037. It just turns out that the combination of tax rates, average age of death, benefit increases, and employment levels don't add up to actuarial break even. So we tweak it a little and move on.

Welfarize Social Secuity
written by floccina, August 02, 2010 10:02
But would it not be sensible to distribute the same amount on SS money to those who paid in less (i.e. those who earned less) as to those who paid in more. And eliminate the SS tax and raise the income tax to fund it instead? The trouble with SS is the tax.
What is it about political corruption do we not understand?
written by Jack E Lohman, August 02, 2010 12:57
We're blaming the economic problem on entitlements when it is in fact due to political corruption.

Nothing is going to change until we have public funding of campaigns. If politicians are going to be beholden to their funders, those funders should be the taxpayers. And at $5 per taxpayer per year it would be a bargain. Even at 100 times that. We MUST lobby our senators and representative to co-sponsor the bill at:

Jack Lohman …
written by Queen of Sheba, August 02, 2010 5:21
Every reporter who resides in the D.C. bubble has convinced himself/herself of the conventional wisdom, i.e., the costs of SS, Medicare and Medicaid must be brought under control. Social Security was included in this entitlements mix for two reasons: the trust funds are holding notes that the government is obligated to redeem and there is no money to redeem them, and Wall Street wants access to future FICA withholding monies.

When faced with the shortages in Medicare and Medicaid, congress passed a health insurance reform bill that managed to ignore the problems with Medicare and actually increase Medicaid enrollment by tens of millions of new patients instead of solving the problems of both programs by opening up Medicare to everyone and cracking down on the fraud running rampant in both programs.

So now it's conventional wisdom that Medicare and Medicaid were dealt with in the reform bill and can't be addressed again (which belief will come back to bite the believers in the ass), so SS is now the prime target for "reform." It's going to be one helluva fight.
written by Calgacus, August 02, 2010 6:47
OK, Benedict. As Modern Monetary theory / Functional Finance / Neo-Chartalism & common sense show, the idea of a government program not having enough money is utter nonsense. We only talk about the affordability of sane, necessary & healthy expenditures, while luncacy like the military & welfare bailouts for rich financial criminals are sacrosanct.

As Dean has been in the forefront of showing, all the claims of Social Security going broke are lies & nonsense, even if we still operated under the gold standard, and the government did not have and constantly use the power to create money at will.

The problem with Social Security is that it isn't going broke. The problem is that it has been run to be too "actuarially sound". The problem is that that fool Greenspan got the nation to enact an idiotic, regressive FICA tax hike 30 years ago, to ensure that the Reagan tax breaks for the rich were paid in dollars that had no chance of being inflated.

The cost high regressive FICA taxes have had on the productivity and growth of the economy has been enormous. A great idea right now would be to have a 1 year holiday on FICA taxation, and just have the general fund pay into the Social Security Fund - two pockets of the same entity. It would be great if SS were "going broke" right now and had to be supported by deficit spending, enlarging our undersized deficit. It would be just what the economy needed to boost aggregate demand. And it would be spent by normal people for normal things, not for psychopaths to produce and use kill-toys, so it would benefit the economy more than most government spending.
Cokie Roberts and Social Security
written by Gene W. DeVaux, August 02, 2010 9:00
Please note that the note that I forwarded to Dean Baker on August 1, was written on July 25th, the day that Cokie Roberts made her claim that the spending on Social Security, Medicare, and the Interest on the National debt together, with no other spending, would still lead to federal deficits. I sent that note to “THIS WEEK” on July 25th, the day that she made her remark, and also sent it to Politifact, the service that is supposed to fact check ABC’s Sunday talk show, “THIS WEEK.” No correction was made on the following Sunday and Politifact did not report the comment on it' website. That is the reason that I sent my note to Dean Baker and to others who are involved in getting the truth out about Social Security, the right-wing's favorite target since 1935. Politifact is not doing the job that it was supposed to do concerning misstatements on “THIS WEEK.” I listened to the show on August 1 to see if there was any mention of the misstatement. There was none. I checked with the Politifact website and found that that organization had not mentioned the misstatement. That is the reason that I forwarded my mail to Dean Baker. No matter how often lies are told about Social Security and Medicare, eventually the truth will come out.
written by AndrewDover, August 02, 2010 9:31
I guess Politifact does not want to revist SS again. http://www.politifact.com/texa...icit-and-/

Don't forget that if you apply the trust fund interest to make SS's cash flow positive now, then you also should add that amount to the tally of federal interest payments. (Frequently the numbers reported are for only the "net public debt" which omits trust fund interest)

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.