Democratic Underground

Stealing Social Security
September 6, 2001
by Dave Conroy

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Is there a non-Social Security surplus? We all know that it is gone now thanks to George Bush. But was there one to begin with?

Remember that there is the trust fund for Social Security. Everyone agrees that until 1998 the trust fund was used to reduce the debt that the government otherwise would owe. Debt that we pay interest on. In short the interest we owe would be much higher had Social Security taxes not been raised in 1983.

Currently that trust fund has $1.2 trillion. That represents what could be called an over charge of Social Security payroll taxpayers. In point of fact that is exactly what he called the non-Social Security surplus and over charge to taxpayers. A

t 7 % interest that trust fund represents $84 billion. At 5 % interest it represents $60 billion. The current surplus with Social Security is either $154 billion or $159 billion. Without Social Security it is either $1billion or -$8 billion.

Before the tax cut and the downturn the total surplus was estimated at $225 billion. Even using the $60 billion figure means that the general budget was a mere $11 billion in surplus. That means that there was no non Social Security suplus as half of the difference was the fault of the economy.

You might ask why does this matter. Think back to the tax cut debate. The entire thrust of their argument was that the tax cut was a rebate of overcharges to taxpayers. Literally millions of taxpayers who pay only payroll taxes were left out. The administration justified this by saying they paid no taxes. In point of fact it is the multi-millionaires who either pay a very small percentage of their income or often none at all to Social Security taxes that paid no taxes.

In short the whole tax debate was a complete fraud. Money collected from only wage earners was not only used to keep the debt lower than it otherwise would have been but now it was used to line the pockets of the wealthy. Worse it will be used to do that for years to come.

Wage earners already paid that money. It was supposed to pay for their retirement. Now it will pay for their CEO's inheritance. There is a word for this. That word is theft. To bad George Bush hadn't had an affair with Chandra Levy. Someone might actually care.