CBS Marketwatch points out Bush Social Security lies in "fact check"

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For low-income Americans, currently scheduled benefits for those who retire in 2080 are $19,906 per year in 2004 dollars. If Social Security can pay only 68 percent of those benefits, that would be $13,536 per year, compared with benefits of $8,804 for low-income retirees who retired LAST year.
For the highest earners, Social Security is currently promising $53,411 per year for those who retire in 2080 (or $36,319 per year if Social Security can pay only 68 percent). Current maximum benefits are $21,891 per year for those who retired LAST year


*Fact-checking Bush on Social Security*
President exaggerates problems in retirement system
by Rex Nutting,
CBS.MarketWatch.com
Jan. 11, 2005

WASHINGTON (CBS.MW) - President Bush made several factual errors Tuesday about Social Security's long-term financing problems at a photo op event designed to educate the public about the retirement system.

Bush is expected to offer a plan in the next few weeks to CUT FUTURE BENEFITS and to divert about one-third of Social Security's tax revenues into individual private savings accounts in order to "save Social Security." See full story.

Before a specific plan is unveiled, the White House is holding a series of events to convince the public that the system must be radically altered to prevent a crisis.

According to the Social Security Administration and the Congressional Budget Office, the retirement system faces long-term funding problems, amounting to about 0.7 percent of gross domestic product over the next 75 years, or $3.7 trillion. Read the Social Security trustees report here. Read the CBO's analysis here.

The SSA says the system's trust fund, financed by payroll taxes and interest payments, will probably be exhausted in 2042, requiring the government to reduce benefits by about a fourth or a third. The CBO says the fund will be exhausted by 2052.

Bush vs. FACTS

Bush: "As a matter of fact, by the time today's workers who are in their mid-20s begin to retire, the system will be bankrupt. So if you're 20 years old, in your mid-20s, and you're beginning to work, I want you to think about a Social Security system that will be flat bust, bankrupt, unless the United States Congress has got the willingness to act now."


THE FACTS: The Social Security system cannot go "bankrupt," for it has no creditors. By law, the trustees will continue to pay reduced benefits even if the trust fund is exhausted. Payroll taxes will continue to come in and benefits will continue to be paid.
According to the trustees' intermediate economic forecast (neither doom nor boom), the trust fund will be able to pay about 73 percent of scheduled benefits in 2042 and about 68 percent of scheduled benefits in 2078.

Future presidents and Congresses could also choose to fully fund scheduled retirement benefits from general tax revenue.

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http://cbs.marketwatch.com/news/story.asp?guid=%7B6D56656B%2DD357%2D4082%2DBD70%2D35F6E6D0AA71%7D&siteid=mktw&dist=

LINKS:
Quote from Bush to 20-year olds about Social Security: http://cbs.marketwatch.com/news/archivedStory.asp?archive=true&dist=ArchiveSplash&siteid=mktw&guid=%7BDEBBD92A%2D6B46%2D4CA7%2D9218%2D62525DD12FD4%7D&returnURL=%2Fnews%2Fstory%2Easp%3Fguid%3D%7BDEBBD92A%2D6B46%2D4CA7%2D9218%2D62525DD12FD4%7D%26siteid%3Dmktw%26dist%3D%26archive%3Dtrue%26param%3Darchive%26garden%3D%26minisite%3D

Read the Social Security trustees report here. http://www.ssa.gov/OACT/TR/TR04/trTOC.html

Read the CBO's analysis here. http://www.cbo.gov/SocialSecurity.cfm