Rumors of Social Security's demise are greatly exaggerated. But some powerful people keep spreading lies about the program to scare people into accepting benefit cuts.
Myth: Social Security is going broke.
Reality: There is no Social Security crisis. By 2023, Social Security will have a $4.3 trillion surplus (yes, trillion with a 'T'). It can pay out all scheduled benefits for the next quarter-century with no changes whatsoever.1 After 2037, it'll still be able to pay out 75% of scheduled benefits--and again, that's without any changes. The program started preparing for the Baby Boomers retirement decades ago.2 Anyone who insists Social Security is broke probably wants to break it themselves.
Myth: We have to raise the retirement age because people are living longer.
Reality: This is a red-herring to trick you into agreeing to benefit cuts. Retirees are living about the same amount of time as they were in the 1930s. The reason average life expectancy is higher is mostly because many fewer people die as children than did 70 years ago.3 What's more, what gains there have been are distributed very unevenly--since 1972, life expectancy increased by 6.5 years for workers in the top half of the income brackets, but by less than 2 years for those in the bottom half.4 But those intent on cutting Social Security love this argument because raising the retirement age is the same as an across-the-board benefit cut.
Myth: Benefit cuts are the only way to fix Social Security.
Reality: Social Security doesn't need to be fixed. But if we want to strengthen it, here's a better way: Make the rich pay their fair share. If the very rich paid taxes on all of their income, Social Security would be sustainable for decades to come.5 Right now, high earners only pay Social Security taxes on the first $106,000 of their income.6 But conservatives insist benefit cuts are the only way because they want to protect the super-rich from paying their fair share.
Myth: The Social Security Trust Fund has been raided and is full of IOUs
Reality: Not even close to true. The Social Security Trust Fund isn't full of IOUs, it's full of U.S. Treasury Bonds. And those bonds are backed by the full faith and credit of the United States.7 The reason Social Security holds only treasury bonds is the same reason many Americans do: The federal government has never missed a single interest payment on its debts. President Bush wanted to put Social Security funds in the stock market--which would have been disastrous--but luckily, he failed. So the trillions of dollars in the Social Security Trust Fund, which are separate from the regular budget, are as safe as can be.
Myth: Social Security adds to the deficit
Reality: It's not just wrong -- it's impossible! By law, Social Security funds are separate from the budget, and it must pay its own way. That means that Social Security can't add one penny to the deficit.1
Sources:
1."To Deficit Hawks: We the People Know Best on Social Security" New Deal 2.0, June 14, 2010
http://www.newdeal20.org/2010/06/14/to-defict-hawks-we-the-people-know-best-on-social-security-12290/2. "The Straight Facts on Social Security" Economic Opportunity Institute, September 2009
http://www.eoionline.org/retirement_security/fact_sheets/StraightFactsSocialSecurity-Sep09.pdf3. "Social Security and the Age of Retirement"Center for Economic and Policy Research, June 2010
http://www.cepr.net/index.php/publications/reports/social-security-and-the-age-of-retirement/4. "More on raising the retirement age" Ezra Klein, Washington Post, July 8, 2010
http://voices.washingtonpost.com/ezra-klein/2010/07/more_on_raising_the_retirement.html5. "Social Security is sustainable" Economic and Policy Institute, May 27, 2010
http://www.epi.org/analysis_and_opinion/entry/social_security_is_sustainable/6. "Maximum wage contribution and the amount for a credit in 2010." Social Security Administration, April 23, 2010
http://ssa-custhelp.ssa.gov/app/answers/detail/a_id/2407. "Trust Fund FAQs" Social Security Administration, February 18, 2010
http://www.ssa.gov/OACT/ProgData/fundFAQ.html8. "To Deficit Hawks: We the People Know Best on Social Security" New Deal 2.0, June 14, 2010
http://www.newdeal20.org/2010/06/14/to-defict-hawks-we-the-people-know-best-on-social-security-12290/Provided by
MoveOn.org*Here's a little reminder for those who may still want to vote against their own self-interest!~Mem
Sharron Angle: "We need to phase Medicare and Social Security out" “We need to phase Medicare and Social Security out in favor of something privatized.” - Sharron Angle [Las Vegas Sun, 6/15/2010]
“Whenever I say privatize, I don’t mean governmental privatization I mean actual free market privatization.” - Sharron Angle [Nevada Public Radio, 5/19/2010]
“Sharron Angle wants to wipe out Social Security…” -AP [Associated Press, 5/27/2010]
2010 Republicans Plan to Wipe Out American Families
Top Republican, Nevada Senator Bill Raggio Endorses Harry Reid!
Rumors of Social Security's demise are greatly exaggerated. But some powerful people keep spreading lies about the program to scare people into accepting benefit cuts.
Deserve," which sadly was already the slogan for the anti-depressant, Effexor. His lieutenant Eric Cantor then rolled out - and quickly abandoned - the National Council for a New America. Its successor, a request for online input called "America Speaking Out" has produced more guffaws than ideas. Worse still, Boehner to much laughter this week followed up his wildly unpopular call for a repeal of the new health care reform law with the same line on Wall Street reform and a proposed moratorium on new regulations of any kind. And it's all complicated further by a Tea Party base which threatens to make Rand Paul and Sharron Angle the new faces of the GOP.