WP: Social Security Formula Weighed: Bush Plan to Cut Promised Benefits

[Liberty Belle]

Social Security Formula Weighed
Bush Plan to Cut Promised Benefits

By Jonathan Weisman and Mike Allen

Washington Post Staff Writers

Tuesday, January 4, 2005; Page A01

The Bush administration has signaled that it will propose changing the formula that sets initial Social Security benefit levels, cutting promised benefits by nearly a third in the coming decades, according to several Republicans close to the White House.
Under the proposal, the first-year benefits for retirees would be calculated using inflation rates rather than the rise in wages over a worker's lifetime. Because wages tend to rise considerably faster than inflation, the new formula would stunt the growth of benefits, slowly at first but more quickly by the middle of the century.
<snip>
"This is going to be very much like sticking your hand in a wasp nest," said David C. John, a Social Security analyst at the conservative Heritage Foundation and an ally of the president. "And the reaction will be similar."
<snip>
The change would save trillions of dollars in scheduled expenditures and solve Social Security's long-term deficit, but at a cost. According to the Social Security Administration's chief actuary, a middle-class worker retiring in 2022 would see guaranteed benefits cut by 9.9 percent. By 2042, average monthly benefits for middle- and high-income workers would fall by more than a quarter. A retiree in 2075 would receive 54 percent of the benefit now promised...

http://www.washingtonpost.com/wp-dyn/articles/A45726-2005Jan3.html?nav=rss_politics


Translation: Tell the kids to develop a taste for cat food when they retire.

[Erika]

1. And Bush Promised there would be no SS cuts

The liar.

[tsuki]

3. For the retired or almost retired. He doesn't care about the young

workers. They aren't his base.

[LynnTheDem]

8. And if we DO NOTHING whatsoever...

then retirees will still get 81% from 2052 onwards.

http://www.truthout.org/docs_04/120804X.shtml

With bush's "plan", you'll only get 75% from 2042 onwards.

So, as always, doing bush's plan IS WORSE than doing nothing at all.

Gee, what a surprise.

[WI_DEM]

2. Once again Bush is going out to punish the poor

Let's face it they will be the ones who will really be hit hard. The people who live paycheck to paycheck and can't put extra money away or set up IRA's. There are other methods that can take place of this kind of thing. If Democrats in Congress don't fight this with everything they got, then they are totally useless. Social Security and Medicare are two of the proudest legacies of the Democratic Party and if the current national party turns their backs on these then I'm going to consider changing my name to WI_Green.

[bluestateguy]

4. MY GOD: He's throwing the Democrats a 65 mph pitch right over the plate

If they can't hit this out of the ballpark they do not deserve to win.

[Lorien]

10. From what we've seen so far

they'll probably praise his "bold leadership" on this issue. :eyes:

[BrotherBuzz]

13. The Democratic leadership would strike out....

if they were playing T-ball! Hey, that's just my opinion from recent observations!

[LynnTheDem]

5. We told ya so. Wakey wakey, rightwingnut Americans.

bush inventing a crisis

Privatizing Social Security -- replacing the current system, in whole or in part, with personal investment accounts -- won't do anything to strengthen the system's finances. If anything, it will make things worse.

Projections in a recent report by the Congressional Budget Office say that the trust fund will run out in 2052. The system won't become "bankrupt" at that point; even after the trust fund is gone, Social Security revenues will cover 81 percent of the promised benefits.

The report finds that extending the life of the trust fund into the 22nd century, with no change in benefits, would require additional revenues equal to only 0.54 percent of G.D.P. That's less than 3 percent of federal spending - less than we're currently spending in Iraq. And it's only about one-quarter of the revenue lost each year because of President Bush's tax cuts - roughly equal to the fraction of those cuts that goes to people with incomes over $500,000 a year.

http://query.nytimes.com/gst/abstract.html?res=F70E11F73F550C748CDDAB0994DC404482

Report Predicts Deep Benefit Cuts Under Bush Social Security Plan

Date of this article? June 19, 2002

http://www.nytimes.com/2002/06/19/politics/19SOCI.html?ex=1104987600&en=d93ab4effc7725c1&ei=5070&ex=1103086800&en=02fd1e95887df5be&ei=5070&oref=login&pagewanted=print&position=top

[Erika]

6. The land of Hugo, Dickens, and Zola

Bush is doing a full circle.

[Liberty Belle]

9. All: Visit senior centers & post/pass out copies

of the WP article and Lyn the Dem's info above. Include a page on how to contact their Congessional Rep and Senator to urge that SS benefits not be touched. Is there a seniors newspaper in your community? Send the editor a copy, too.

Notify younger people, too. Take copies with you everywhere and pass them out to store clerks, leave copies in the beauty parlor, etc. This is THE issue that should unify opposition to Bush. Everyone should oppose this idiotic and cruel proposal!

[Kolesar]

16. You woke me with all that oversized typeface

Thank you for pointing out the 81%

[teryang]

7. Is this some kind of surprise?

Anyone with an ounce of sense had to know this was coming before the election.

[Kablooie]

11. and it's going to hit the massive babyboomer group first

[daleo]

12. Canada did a fix on its Canada Pension Plan a few years ago

The rates were raised a bit, and any sort of crisis has been averted. There are still RW propagandists that claim otherwise, of course, but they are wrong. The U.S. system could have easily been adjusted as well, I am sure, but Bush and most Republicans don't like the idea of average people having any security. It rankles them to think that anyone but the rich can feel the slightest financial security.

[zann725]

15. I think they want us all to HAVE to work 'til we die...because of

'reduced' SS benefits. Though they're not just cutting Social Security. Many companies (unions too) are cutting Pension Plans entirely, or revising them drastically from how they were originally negotiated. It's sad. Everyone deserves some time to enjoy retirement, and life.

[chicagojoe]

14. This clown is cruisin' for a bruisin'.

Contact your Reps and Senators. My rep is that piece of shit Hastert,
but at least we have two good people in the Senate from IL.

[Kolesar]

17. This means that I have been paying for faster-than-inflation increases...

...in SS pensions for the people who are retired now. I don't think that is fair to me. They are gobbling up the 13% of my wages that my employers and I have put into SS. The elderly in America are not an impoverished class. They use their clout to keep shifting wealth from young workers to them. They could get by with just cost-of-living increases.

[mbperrin]

20. If you buy that current inflation numbers are anywhere near

accurate, can't help you.

And surely you don't mean that people like one of our tenants whose sole income is $734/month from Social Security is wealthy by any measure.

These averages are funny things. Take 30 people in a room. 29 of them have nothing, one has $30 million; now, on average, they're all worth $1 million.

And surely you don't buy that your current withholding is being written out as payments now. SS is in a surplus mode, and has been for decades. Will be for decades yet.

And surely you're not happy about Ron Raygun "borrowing" $2 TRILLION from SS for Star Wars, or the current group of fatheads "borrowing" another $2 TRILLION to cover their richie tax cuts.

Although where I'm from, when you "borrow" with no intent to repay, it's called theft, and those people are called thieves.

Course I'd call them worse, but no doubt Agent Mike is watching. Hi, Agent Mike!

[Kolesar]

21. I think that even inflation is overstated

Much less the "rising wage index" that SS has been using. They keep introducing new products into the cost of living index like PCs. How is that relevant to the cost of living?

[saigon68]

18. develop a taste for cat food

Live in a cheap Nursing Home

Where you only get A DIAPER CHANGE--ONCE A DAY


SOUNDS LIKE FUN TO ME </SARCASM>

[Hekate]

19. Krugman says the SocSec "crisis" is a huge lie

It's got a thread over in the Editorials section at DU, but the whole thing is printed in the New York Times at
http://www.nytimes.com/2005/01/04/opinion/04krugman.html?oref=login&oref=login

Krugman's point is that Social Security could use a little tweaking but otherwise is in fine shape, and that the Bush plans will be the absolute death of the whole program. He also points out that the MSM keeps reporting Bush regime statements about the program as if they were fact, when actually they are lies.

Sound like anything else coming from the Bushes?

Hekate
:argh:

[Massachusetts]

22. Bentley Drummle (Bu$h)

STRIKES AGAIN!

Kinder gentler nation, just where is that?:eyes:

[Moderator]

23. duplicate

discuss here

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1119365