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Home Publications Blogs Beat the Press NYT Finds that Social Security Makes Overpayments Equal to 0.01 Percent of Its Spending to State Workers

NYT Finds that Social Security Makes Overpayments Equal to 0.01 Percent of Its Spending to State Workers

Wednesday, 21 July 2010 07:05
The NYT devoted a story to an audit by Social Security's Inspector General that found the system pays $53.2 million annually more than it should to former state and local government employees. The overpayment stems from a failure to correctly offset pensions earned in government employment that is not covered by the Social Security system. 
Comments (3)Add Comment
written by izzatzo, July 21, 2010 1:26
The NYT neglected to report that since the new austerity programs designed to reduce the deficit will also increase productivity, total output and government tax revenue, there will be enough surplus for the government to replace the entire SS fund of Treasury bonds with cash, and enough new jobs to fund SS itself to infinity with a rising surplus in its own free standing account.

Instead, the NYT has deployed dedicated reporters to investigate state pensioners who may have used the extra cash to upgrade from a 2-door Yugo to a 4-door Yugo.
written by zinc, July 21, 2010 7:53
Why don't they report on the real over payments to the rich welfare queens, with enormous income flows, that are recieving social security and medicare benefits far in excess of what they actually paid into the system. I personally know rabidly antipopulist republican people with incomes over $250 K/yr receiving full benefits. And they scream bloody murder at the suggestion they should be cut off because they "earned" it.
written by Some Guy, July 21, 2010 9:57
What the hell is Social Security supposed to do? Because it deals only with SS wages and limited IRS data, the organization is going to have limited means for determining whether a beneficiary is receiving a pension. Should they massively increase their staff so that they can perform investigations of every low earner? Or should they call it rounding error and try to improve disability instead?

As for the article, the sentence about apparent "low lifetime earnings" is a complete red herring. Maybe I'm misreading it, but the article seems to imply that the welfare function of SS is how these people are gaming the system.

That's not really true. Having a higher earning's base is always going to make your benefits higher. So drawing benefits off of a high earner's record will be superior to earning a high percentage of the pittance one pays in in noncovered employment. Really, it's as spouses, divorcees, widows and widowers on records with covered earnings that government pensioners cash in.

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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.