What was that about Social Security?
It was an easy to miss paragraph toward the end of Obama's speech tonite:
To coin a phrase, I may need to be talked town here.
To preserve our long-term fiscal health, we must also address the growing costs in Medicare and Social Security. Comprehensive health care reform is the best way to strengthen Medicare for years to come. And we must also begin a conversation on how to do the same for Social Security, while creating tax-free universal savings accounts for all Americans.Now, TPM folks are already well aware that the "crisis" in Social Security funding is mostly a fiction; and we just gave Bushco a thorough beatdown on this whole thing a couple of years ago. So someone please translate that last sentence for me. What exactly is the President talking about, and why does it sound to me like Social Security Privatization has just risen from the dead?
To coin a phrase, I may need to be talked town here.
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Hey, did you miss that he's going to get money from Medicare for his health care "reform" too?
Watch the fine print folks. When we get Blue Dogs making their deals with Republicans our "entitlements" are going to get "reformed" and once "reformed" they may not be "entitlements" but "mandates". They will order us to save money for retirement and they will order us to buy health insurance and we all know we can trust our insurance companies just like we trust our banks.
February 25, 2009 10:06 AM | Reply | Permalink
The President is talking about a modified version of the same bullshit Bush was proposing to destroy social security. The whole solvency issue is a red herring.
The purpose of the massive Republican deficits was only secondarily to reward their rich patrons. The real purpose was to cause the government to choose between defense and social security and everything else. Instead of honoring the 1982 agreement which imposed an additional tax on everyone in my generation which we have been faithfully paying in order to avoid financial problems resulting from the baby boom, Obama and many other politicians (mostly Republicans) want to change the terms now that they have spent all that additional money on more bullshit.
The problem is that they refuse to even take a look at the most wasteful and unproductive category of federal spending which is the war machine and it's obscene annual lug for all kinds of things we don't need, shouldn't have and everyone prays we don't use. There should be a massive pushback by the netroots and grassroots Democrats on this. Mr. President: hands off Social Security!
February 25, 2009 10:17 AM | Reply | Permalink
Hands off Social Security and hands off Medicare! And don't you dare touch my employer paid health plan until you show me your commitment to provide universal healthcare. Don't shove me off on some insurance company that will steal my premiums for profits which it will gamble away in the great global financial casino.
Show me the safety net. Show me the money.
February 25, 2009 10:39 AM | Reply | Permalink
Now THAT's something to shout about, IMHO. It blows me away that this kind of proposal is being made at a time when we see how vulnerable the private sector can be. We should be playing the "Lock Box" Lectures of Al Gore right about now. This has already been addressed. We do not need to have Universal Savings Accounts.
We need the government to be the transparent machine Obama has promised and SS and Medicare revealed as to how they are run. Then we can find the insects and exterminate them. There is nothing wrong with these programs when run right.
One way to reduce Medicare costs would be to start negotiating with the drug companies once again. Perhaps a little more competition there would do the program a lot of good.
February 25, 2009 10:24 AM | Reply | Permalink
If social security is to be destroyed it will be a Democrat who does it. If not for Monica, Bill might have already done it.
February 25, 2009 11:24 AM | Reply | Permalink
HOw many knee jerks until you are just jerks?
First, Obama has said over and over and over that he opposes privatization. Close to 100% of his party agrees. How can you possibly imagine that is what he is talking about? Paranoia is not a cognitive process.
Second, in about 6 or 7 years, Social Security begins to spend more revenue than it collects. That money (1st called interest on the Trust Fund bond and then about 10 years later the principal) has to come from somewhere.So it is clearly a budget issue. Obama has repeatedly said he prefers to raise revenue by raising the income threshold on which payroll taxes apply. That would mean no cut just the needed revenue to pay what we have in law. The opposition prefers to cut benefits.
Third, 50% of Americans have no pension plan linked to their employment outside Social Security. For those of us who understand that Social Security was not meant to provide 100% of retirement income, that is a problem. Creating in essence a universal 401k accessible to those without any pension plan with contributions from employers and government as well as from workers that would be invested in private assets is a good thing. People who wrongly think this is a trojan horse for changing the nature of Social Security must hate low wage working folks who don't have access to pensions. Why do you hate them so much?
February 25, 2009 12:31 PM | Reply | Permalink
Yes, because I asked for help understanding what's going on here, I hate my fellow working man.
My problem is that BHO has been using the same vague and portentious language about SocSec needing to be "fixed" that has been the foot-in-the-door of the Concord Coalition crowd for years, and seemingly uncritically. Sorry, but anything that gives David Brooks a hardon starts me a worryin'.
OK, so SocSec will soon start paying out more than it takes in; of course the demographic corollary is that it's been taking in more than it's been paying out for pretty much the whole working life of the Boomers, no? Most of the estimates I've seen say that if SSA was a stand-alone retirement plan it would be in perfectly good shape well into the 2030's or 40's. The real "crisis" is that in the much nearer term, SSA will have to start calling in it's debts to pay benefits -- i.e. cashing in it's T-bills, thus revealing the dirty secret that much of the government for decades has been funded by the super-regressive FICA tax, so as to keep regular income taxes, and the deficit, artificially low.
Please correct me if I'm wrong about all this; I don't have much time to research it at the moment. But if I'm not wrong, then we should stop saying that the problem here is with Social Security. It's not. The transparency and honesty Obama champions should go past conventional wisdom where CW is just an agreed fiction.
February 25, 2009 11:53 PM | Reply | Permalink
To me the key to that sentence is the word "while".
That means concurrently fixing Social Security and encouraging savings by creating tax-free savings accounts. That could mean the exact opposite of tying retirement savings to the stock market like 401K's. By allowing savings plans in the bank to be taxfree, he's giving workers more options on how and where to put their money for retirement.
That's how I read the sentence that's causing all the distress.
February 25, 2009 2:42 PM | Reply | Permalink
"while creating tax-free universal savings accounts for all Americans"
IRA? Roth IRA? Hello?
What the heck is he talking about?
From a recent blog, my related thought:
February 25, 2009 4:08 PM | Reply | Permalink
So your argument against mentioning the universal savings account is that we already have IRA's. You might wanna do some research.
http://www.commonwealthfund.org/Content/Charts/Report/Medicare-Out-of-Pocket-Costs--Can-Private-Savings-Incentives-Solve-the-Problem/P/Participation-in-IRA-or-401-k--Type-Plans--by-Income-Quintile.aspx
Apparently, you don't think poor folks should be able to save. thanks.
Also, why would you need to dedicate another stream of income other than the payroll tax to pay for Social Security? I mean why would Social Security need more income? If everything is hunky dorry? So how much revenue are we getting back from the bailouts? You are going to count on that?
February 25, 2009 9:56 PM | Reply | Permalink
I made no such argument.
Apparently you can't read well.
Poor folks cannot save much? Wealth is irrelevant to saving. Rich people often don't save, poor people who have wages generally can save.
Your barrage of questions make no sense.
February 26, 2009 4:31 AM | Reply | Permalink
I agree with Economides & turnip. Everyone needs to settle down. Obama would never touch SS.
Instead, the reference to 'Universal Savings Accounts' is one of two things. 1) A revamped planned of the 1999 Clinton Universal Saving Accounts (USAs), which were billed quite clearly as a SUPPLEMENT to SS, not a replacement. This initiative was largely seen as an attempt to bridge the retirement security gap of those individuals not offered defined benefit or contribution plans (i.e. pensions or 401ks). (See Below An excerpt from the initial description of the plan); or 2) the groundwork for a much broader savings initiative that might include child savings accounts and matching-dollar IRAs for qualified savers.
So everyone can relax.
Taken from: http://www.network-democracy.org/social-security/bb/proposals/usa_accounts.html
Here's How USAs Work:
98 million adults would receive an automatic government
contribution to their Universal Savings Account every year.
In addition to the automatic contribution, the government
would match, dollar for dollar, voluntary contributions to
the USAs by low and moderate income workers. Eligible
workers with higher incomes would have a match rate of at
least 50 percent.
February 25, 2009 4:54 PM | Reply | Permalink
.
Will this possibly help?
Loren, you said:
Read sentences 3 and 4 closely over here in my Cafe blog from the Obama/Biden Agenda:
SENIORS & SOCIAL SECURITY -- Protect Social Security
I hope this puts your mind a little more at ease.
~OGD~
February 25, 2009 5:00 PM | Reply | Permalink