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Home Publications Blogs Beat the Press The New York Times Thinks It is A Problem That Retirees Spend Down Their Savings: Yet More Nonsense on Social Security

The New York Times Thinks It is A Problem That Retirees Spend Down Their Savings: Yet More Nonsense on Social Security

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Monday, 14 February 2011 22:48

The NYT apparently really wants Congress to cut Social Security. How else can someone explain the absurd comment that:

"Some administration advisers wanted him [Obama] to propose specific changes to fix Social Security, which has accumulated surpluses to date but before long will begin paying out more than it takes in from payroll taxes."

Of course the reason that Social Security accumulated surpluses was to cover the period after the baby boom is mostly retired when it is projected to pay benefits that exceed annual revenue. This is not a problem, it is part of the design of the program. If President Obama has any officials who do not understand this basic fact, then they are obviously way over their head.

Comments (4)Add Comment
...
written by vorpal, February 15, 2011 12:05
The article should say "some advisors to obama wish to turn Social Security into a slush fund."
...
written by PeonInChief, February 15, 2011 10:40
What it really means is, "We collected all this money from boomers for 30 years to pre-fund their retirement, but we spent the money on other stuff and now we don't want to have to pay it back to them."
Saint Ronald strikes again.
written by Ethan, February 15, 2011 11:57
I'm remembering now how great a president Ronald Reagan was. He increased the social security tax so that the program would be self supporting through the baby boomer's retirement. How prescient. Why don't we do the same thing now -- increase taxes to pay for what we will need in the future?
Can the Federal Government Really Save?
written by Floccina, February 15, 2011 4:19
Of course the reason that Social Security accumulated surpluses was to cover the period after the baby boom is mostly retired when it is projected to pay benefits that exceed annual revenue.


This implies an accumulated surplus of goods and services or investment with future yields. I guess that they could have spent some small part of the surplus collected on roads where they could later charge a toll but I think that it is better and more honest to think of SS as a welfare program that takes in money and gives out money rather than an investment program. Is it even possible for the federal Government to save money on that scale apart from huge lending to foreigners, which would not go over with the median voter?

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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.

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