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AP Displays Numeracy Deficit in Social Security Coverage

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Sunday, 30 January 2011 22:36
A headline of an AP article (featured on Yahoo's website) told readers that: "Social Security posting $600B deficit over 10 years." Actually, the Social Security program is projected to run a surplus in every year of the next decade, adding more than $1.3 trillion to its trust fund, as people with access to the Social Security Trustees Report know.

 

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Another Yahoo hit piece on SS
written by @joely, January 30, 2011 11:57
Social Security fund will be drained by 2037

http://news.yahoo.com/s/ap/20110127/ap_on_bi_ge/us_social_security

Posted by the same author (STEPHEN OHLEMACHER, Associated Press) on the same day as the other article.

It's like this guy's a one-man disinformation machine.
...
written by izzatzo, January 31, 2011 7:05
Actually Yahoo got it right, already reporting that because Americans consume too much sunshine in the daytime, it increases the deficit of sunshine at night and causes the days to be shorter in a blinding race towards total darkness, noting however they don't believe in climate change.
Media Conspiracy or just Laziness?
written by teacherz, January 31, 2011 7:39
What's even more disconcerting (and ominous) is that Ohlemacher's misleading article was highlighted as "up-to-minute" news on both the Comcast and Verizon homepages. Both reported it as factual and both kept it up for a full day ... without any dissenting (or elucidating) viewpoints. I'm going with conspiracy!
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written by skeptonomist, January 31, 2011 8:53
The surplus is only temporary. It should be carefully explained whenever possible that SS must start running deficits, paying out the huge excess in the Trust Fund; if this is not done baby boomers will be cheated, since they have paid to build up the surplus with payroll taxes. It was the plan all along that this would happen; and it was also the plan that the funds for this payout would come from income taxes. If income tax rates are not high enough for this now, they must be raised. Rates on higher brackets are much lower now than they were when the process of building the Trust Fund up began in 1983.

Of course, when SS is "drained" by around 2037, it will be exactly where it was planned to be and where it operated for the first 50 years of its existence; in a pay-as-you go state.

If boomers understand the basics, they are a sufficient political force to block looting of SS. It's fairly simple; they paid into the Trust Fund, they should get the money back, and as this happens the Trust Fund will mostly disappear (it is supposed to have a fairly small operating balance).
Scary Deficits
written by FS, January 31, 2011 9:23
I don't know if the use of "Deficit" in the headline was used intentionally to scare people into believing that Social Security is going bankrupt or if it was simple ignorance.

I'd suggest "draw down" as a more descriptive term. When I retire, I plan to draw down my 401k investments to fund my retirement. I wouldn't call that a deficit. Similarly, the Social Security Administration built up a large surplus in the Trust Fund, and it's going to start drawing down that surplus to pay for benefits. Over the next 26 years (by 2037), the total draw down will be about $2.6 trillion. This averages $100 billion per year, which is easily affordable.




...
written by Bloix, January 31, 2011 10:51
The Washington Post "Express" (the free paper they give away at metro stops) ran this article.

And skeptonomist - it's not correct to say that the "deficit is only temporary." There is no deficit at all. Social Security is paying down a surplus. As you point out, this is intentional. It is not running a deficit.
2010 Social Security Trustee Report is Out of Date
written by Ethan Pope, January 31, 2011 10:54
Be sure to post the Social Security 2011 Trustee Report on your website when it is published. The 2010 projections will be corrected at that time. The AP report is correct.
deficit smeficit
written by pete, January 31, 2011 1:14
Dean likes to think that the "interest" on the soc. sec. "bonds" is like the current payroll tax. Of course, the "interest" just means more taxes in the future, as does the "surplus".

Deficit, meaning the payroll tax revenues are less than the checks written, is interesting...meaning current income taxes, not payroll, must make up the difference, thats all, whether or not you talk about the future claims ("interest") or simply the accumulated "surplus". A rose is a rose, and a tax is a tax.
and don't forget, Reagan won the Cold war
written by George Fleming, January 31, 2011 1:27
Frank Rich (now even the gold is rusting) called SS a "money pit" in his latest column. None of the highlighted commenters objected that SS has been a money pot for the government since Reagan started borrowing (stealing) from it:

http://www.nytimes.com/2011/01/30/opinion/30rich.html?_r=1

Reagan also won the Cold War. Yes he did. Everybody says so. Except a few, like Robert Parry:

http://www.opednews.com/populum/print_friendly.php?p=Reagan-s-Tear-Down-This-W-by-Robert-Parry-110129-319.html&c=a


McClatchy too
written by George Fleming, January 31, 2011 1:41
Claudia Buck warns us about "SS's chronic underfunding." The chronic problem with SS is the right-wing lies about it:

http://www.sunherald.com/2011/01/29/2817489_p2/consumers-should-have-a-plan-for.html
...
written by Chicago Todd, January 31, 2011 2:19
This is the headline I saw on Jan 26th: "Social Security fund now seen to be empty by 2037"

They must change it as they see fit.

http://news.yahoo.com/s/ap/social_security
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written by Allan, January 31, 2011 3:46
One of the recent Republican talking points is that the bonds owned by the SS trust fund are not real; therefor the interest earned on these bonds is not real. Republicans are pushing the belief that the "real" SS trust fund measure is cash coming in (contributions) versus cash going out (benefit payments).

If I remember correctly Bush went the SS admin center in West Virginia during his privatization push and to start the pushing of this argument. He stated the bonds are just simply "pieces of paper".

As an aside the bonds held by the SS trust funds are non-maketable but can be redeemed at any time by the SS trust fund (these are the same type of bonds held by the military retirement fund). Strangely enough, Bush never made the same point about their bonds.
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written by cartias, January 31, 2011 3:50
Yes we can end social security as we know it for the middle class and now we can put it into the stock market. Ill try and take my $20,000 to a hedge fund manager and ask where do I sign up with you guys?? Its a joke . Its more money for the fat cats !!!!!!!!!!!!!!!
poor link and question about flow from general treasury
written by ezra abrams, February 01, 2011 8:39
1) providing a link to the report, without telling people what to look for in that highly complex document is, well, lazy
2) can some one, please, explain the social security is is not contributing to the deficit argument ? the is not people say the law forbids general revenue from being used for ssi therefore ssi can't contribute to the deficit; the is people say but we have to pay back the ious accumulated during the baby boom surplus era....wtf ??

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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.

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