Written by Dean Baker
FactCheck.org, a project of the Annenburg Public Policy Center, wrongly attacked a number of prominent Democrats for correctly pointing out that Social Security does not contribute to the deficit. The people attacked, included New York Senator Charles Schumer, Senate Majority Whip Richard Durbin, and President Obama’s Budget Director Jacob Lew, who had all correctly pointed out that Social Security does not contribute to the budget deficit.
This point should be pretty straightforward. Under the law, Social Security is financed by a designated tax, the 12.4 percent payroll that workers pay on their first $107,000 of income each year. The money raised through this tax is used to pay benefits. Any surplus is used to buy U.S. government bonds. All funding for the program comes either from this tax or from the bonds held by the program’s trust fund. (It also is credited with a portion of the income tax paid on Social Security benefits.)
Social Security is prohibited from spending any money beyond what it has in its trust fund. This means that it cannot lawfully contribute to the federal budget deficit, since every penny that it pays out must have come from taxes raised through the program or the interest garnered from the bonds held by the trust fund.
<...>
Obviously Senators Schumer and Durbin and Mr. Lew were referring to the on-budget budget. It is hard to believe that Factcheck did not understand this basic fact about the U.S. budget. They were right and FactCheck is wrong.
Social Security does not contribute to the budget deficit. That is the law.
What is with Factcheck.org and Social Security? They seem to go out of their way to protect the Republican frame.
Here is Factcheck.org covering for Bush in 2004:
Kerry Falsely Claims Bush Plans To Cut Social Security Benefits Less than four months after the 2004 election, Factcheck.org:
Bush's State of the Union: Social Security "Bankruptcy?"In his State of the Union Address, President Bush said again that the Social Security system is headed for "bankruptcy," a term that could give the wrong idea. Actually, even if it goes "bankrupt" a few decades from now, the system would still be able to pay about three-quarters of the benefits now promised.
Bush also made his proposed private Social Security accounts sound like a sure thing, which they are not. He said they "will" grow fast enough to provide a better return than the present system. History suggests that will be so, but nobody can predict what stock and bond markets will do in the future.
Bush left out any mention of what workers would have to give up to get those private acounts -- a proportional reduction or offset in guaranteed Social Security retirement benefits. He also glossed over the fact that money in private accounts would be "owned" by workers only in a very limited sense -- under strict conditions which the President referred to as "guidelines." Many retirees, and possibly the vast majority, wouldn't be able to touch their Social Security nest egg directly, even after retirement, because the government would take some or all of it back and convert it to a stream of payments guaranteed for life.
<...>
Still, Factcheck.org kept on trying to defend Bush's privatization scheme by claiming Bush's plan wasn't technically a
cut in benefits.
MSNBC, 2005:
Undaunted, Bush pushes Social Security reform WESTFIELD, N.J. — President Bush kept pitching his Social Security overhaul Friday, undaunted by Democratic opposition, frayed Republican support and less than enthusiastic backing from the public.
“I’m going to keep telling people we’ve got a problem until it sinks in, because we’ve got one,” Bush said, underscoring estimates that say Social Security will begin paying out more than it collects in taxes as early as 2018.
Bush’s visits to New Jersey and South Bend, Ind., began a two-month blitz in which he and other administration officials are visiting 29 states. The road trip ended a week in which the administration lost momentum on the president’s call to revamp the government’s 70-year-old retirement system.
<...>
Bush envisions no change for current retirees or workers age 55 and older. Under his plan, however, younger Americans could divert up to 4 percent of their income subject to Social Security taxes into personal accounts in exchange for a reduction in their guaranteed benefit.
<...>
Democrats successful beat back Bush's attempts to privatize Social Security.
WaPo (2005):
<...>
Democrats responded with their own "Fix It, Don't Nix It" swing while other Bush opponents staged news conferences, placed newspaper ads and commentaries, and aired radio commercials targeting the two House Republicans who hosted the president Friday. Outside Joyce Center at the University of Notre Dame, about 100 protesters greeted Bush's motorcade with signs such as "Social Security Another Big Fat Lie."
<...>
Pelosi: Bush is bragging about failed Social Security privatization efforts because he failed elsewhere. (2009)
Nancy Pelosi Responds To President Bush On Social Security: We're Very 'Pleased' He Is Disappointed (2010)
Destroying Social Security is the Republican wet dream. Yet Factcheck.org seems determined to mischaracterize these attempts as credible and attacking legitimate Democratic positions.
Printer-friendly format
Email this thread to a friend
Bookmark this thread
(1000+ posts)
Send PM |
Profile |
Ignore
