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Awesome Social Security Debate on MSNBC
+ YouTube Video
I caught this heated exchange checking out the news highlights and I had to share. Cenk Uyger absolutely decimates Republican efforts to destroy the entitlement program. Ugyer, for those who may be unaware, is the host of satellite radio and YouTube news program The Young Turks, which was formerly broadcast on the now-defunct Leftist radio network Air America. Uyger is friends with MSNBC's Dylan Ratigan who's one of the better personalities in the mainstream media and has done some excellent pieces on the disgusting fraud of the Wall Street bailout. They have starred on eachother's programs, with Ratigan filling in for Uyger on Young Turks, and Ratigan frequently inviting Uyger on MSNBC. This week Ugyer is substituting for Ratigan and he does a fantastic bit here absolutely shredding the attempt by the right to privatize social security, of which congressman Paul Ryan's 'Roadmap' is the latest incarnation.
[FONT=Verdana]Economic Left/Right: -7.25
Social Libertarian/Authoritarian: -7.13[/FONT]
"Kick over the wall 'cause government's to fall,
How can you refuse it?,
Let fury have the hour, anger can be power,
D'you know that you can use it?"-The Clash, "Clampdown"
Jesus Christ sometimes Cenk owns.
Even though I have a radically different opinion than him and he's a centrist hack, his heart's in the right place at least.
I'm on some sickle-hammer shit
Collective Bruce Banner shit
FKA: #FF0000, AKA Mistake Not My Current State Of Joshing Gentle Peevishness For The Awesome And Terrible Majesty Of The Towering Seas Of Ire That Are Themselves The Milquetoast Shallows Fringing My Vast Oceans Of Wrath
Social Security needs to re-examine its pathetic investment portfolio as well as scrap the cap.
"A new centrist project does not have to repeat these mistakes. Nobody in this topic is advocating a carbon copy of the Second International (which again was only partly centrist)." (Tjis, class-struggle anarchist)
"A centrist strategy is based on patience, and building a movement or party or party-movement through deploying various instruments, which I think should include: workplace organising, housing struggles [...] and social services [...] and a range of other activities such as sports and culture. These are recruitment and retention tools that allow for a platform for political education." (Tim Cornelis, left-communist)
Indeed.
He's not a Centrist, he's a Liberal/Progressive.
[FONT=Verdana]Economic Left/Right: -7.25
Social Libertarian/Authoritarian: -7.13[/FONT]
"Kick over the wall 'cause government's to fall,
How can you refuse it?,
Let fury have the hour, anger can be power,
D'you know that you can use it?"-The Clash, "Clampdown"
Not really, he's somewhat progressive, he's mainly liberal, but overall I think he's pretty centrist. (I say that from American people standards, not washington standards).
I'd like to make a few comments on that debate. First of all, the host is correct when he says that the Social Security Trust Fund had a $2.5 trillion surplus in 2009[1], but I don't think many people dispute this. The real issue is the long term health of Social Security, which depends on both the annual balance of Social Security (ie. difference between outlays and receipts [mainly from payroll taxes]) and the annual balance of the Trust Fund. Remember that any surplus on the annual balance of Social Security is paid into the Trust Fund and that any deficit on the annual balance of Social Security requires taking money out of the Trust Fund (although the Fund could still grow with annual deficits if interest income is higher than said deficits). Now, the Social Security Administration projects that the annual balance of Social Security will be in deficit this year, but that the deficit will be significantly smaller in 2011, with the annual balance going back into surplus for 2012-2015. From 2016 onwards there is projected to be an annual deficit, increasing in size every year until 2025. At that point, the annual surplus on the Trust Fund begins decreasing until it is exhausted by 2037. So in 2037, expected social security outlays can only be met by raising payroll taxes or reducing benefits.[2]
Now that's not an immediate problem, but the point of reforming Social Security now is that the earlier reforms are implemented, the less painful it is to transition. So going back to the video, people who suggest that Social Security is going broke are not lying as the host suggests. I'm a little confused though because the host then says the Trust Fund surplus has already been spent, which surely means that he thinks it is broke? As it happens, I think he is incorrect because the Social Security and Medicare Lockbox Bill of 2001 prevents the Trust Fund from being used for non-Social Security expenditure.[3] Next he says that the annual Social Security deficit in 2010 is a "blip in the radar", which is true, but it is only goes back to annual surpluses for 3 more years (2012-2015) before falling into annually increasing deficits. The host is disingenuous in ignoring this, although he does rightly point out that the Fund is projected to be exhausted in 2037 (and the Republican is incorrect in disputing these projections). I don't understand why he sort of skips over this point, though. Surely this is the major issue?
Next the host presses the Republican on his plans to reform Social Security. I think the Republican is being quite sensible in keeping benefit cuts and raising the retirement age on the table and it's silly for the host to suggest that he therefore definitely wants to carry them out. The host (who evidently opposes these options) sets out his plan for Social Security: cutting defense spending and raising taxes for rich. The former option I support, but not for reasons relating to Social Security. Although a reduction in defense spending (and a transfer of the savings to the Trust Fund) would provide a one-off extension to the life of Social Security, it doesn't address the problem of annual deficits, which would continue to deplete the Trust Fund over time. Raising taxes on the rich probably does address this problem (dependent on the Laffer curve), but I think this is a bad long term option given the alternatives.
My own preferred solution is to replace payroll taxes with compulsory saving into a special bank account. This account would have either limited or no access until retirement (at which point either full access could be granted or monthly installments could be allowed), so it would grow through payments into it and interest over the course of an individual's life. The individual should also have the option of investing some portion of the accumulated funds in the stock market. The government could "top up" the accounts of those with low funds at the retirement age, so everybody should be provided for. Therefore the only thing the government needs to worry about is its spending on "top ups", which should be much easier to stabilize. Of course, the transition to a system like this would be difficult in the short term. A higher retirement age, benefit cuts, and increased taxes on the rich would all go some way towards supporting that transition, and after a period I think all three could be reversed.
[1] http://www.ssa.gov/OACT/STATS/table4a3.html
[2] http://www.ssa.gov/OACT/TRSUM/index.html
[3] http://www.ssa.gov/legislation/legis...in_032201.html
THe nature of the debates makes the host make that assumption, Republicans have been tyring to cut social security for decades.
For most republicans reform, means cutting benefits. The actual problems with social security, as you pointed out, are comming way in the future and can easily be delt with by taxes on the rich and more importantly cutting defense.
Social security is'nt in a bubble, you can cut other things first.
Also end the cap.
Except it has been used for war, they got around that, that law has huge loopholes.
What republicans want to do has nothing to do with the projected problems starting in 2037, it has to do with cutting benefits because they don't want to give up anything else for social security, which they spent on war, and which WE paid into.
What your doing there is essencially what happened with healthcare reform. Your giving wallstreet a huge amount of citizens money for them to gamble with. Also the topping off part is going to require actually more taxes, so its not solving the problem.
Unless you have major major financial reform thats exactly what its gonna be.
What we need to do is end the cap on high end income (that by itself would probably take care of it), cut defense spending, and have a more progressive tax system, the problem is'nt huge, but cutting benefits is only adding insult to injury.
Social security needs to be exactly what it is, social, it needs to be democratically controlled.
Great post inyourhouse.
Talking (screaming) heads like those above shed very little light on the subject. That being said it becomes clearer and clearer that the US government (at the very least) really isn't a good provider of general social services like Social Security and Medicare (let alone universal healthcare.) There are too many people in Congress as well as the President who have constant and regular "emergencies" and special needs that come up the the daily course of business (a war here, a rescession there) that see social programs as a constant source of ready and easy cash. One could even presume that without that supply of easy cash that America might not let itslf get involved in its little adventures tht have always caused it so much trouble.
The structure of American politics just doesn't lend itself to Socialist ideals. Either the basic system of American government has to change or the slide to the Left has to stop.
Personally I think it would be best for America if both corporate and social entitlements are limited.
Compared to who? Look at private pensions, what has happened to those, look at private health insurance, then look at medicare and social security.
Even with those emergencies, it still does better. Plus a corporation does'nt need to justify any emergencies (like ceo pay), the government is democratically accountable.
Its not little adventures, Americas militancy has to do with imperialistic power, you take the American government out of the corporate hands and into the peoples hands things are different, but what your asking for is putting EVERYTHING into corporate hands, and you do that its not gonna stop militancy, they'll still get that done.
What slide to the left? When has the American government slid to the left in the last 30 years?
The American system dose'nt lend itself to democracy because its corporatist in nature, thats waht needs to change.
So I take it your giving up the claim to social democracy.
Private pensions are just fine--or at least the 401Ks and individual personal retirement plans. Corporation are getting out of the business of giving them because the government seems to be taking up the mantle.
I don't trust the government any more than I trust Exxon.
No. Take everything out of government hands and out of corporate hands--I'm no more a fan of big corporation than you. No--people need to grow up and take care of themselves. They need to learn how to save and learn how to invest for their futures. If they rely in the government or corporation or unions to do that for them, they will be disapointed.
Medicade/Medicare was the biggest slide.
Big corporations are as bad as big entitlements.
No. I'm just saying that it doesn't work very well under the American system. I'm sure the system in Norway or Sweden is much better.So I take it your giving up the claim to social democracy
Can't say I like the host's style of arguing with surplus this or that.
Money only appears to be a store of something. While it sometimes makes sense for an individual to put some in a piggy bank for later, the world cannot save in money. When you are young, a part of the stuff you produce goes to people too old to work. When you will be that old yourself, a part of the stuff the young will be producing will go to you. What you will get in the future will depend on the level of productivity in the future and what the political decision about how to divide that cake will be. All that blather about some perceived need to balance some budget now for later is beside the point.The problem with your "analysis" is not that your macro view is wrong in places, the problem is that you don't have a macro view. A government that issues its own currency doesn't run out of its own currency. Taxing has something to do with avoiding too much inflation, not with avoiding bankruptcy. You fail macro economics forever.
I think inyourface understands economics very well. You on the other hand fail to understand his very cogent point that Social Security was set up to PAY FOR ITSELF.
Corporations are getting out of them because they've hurt unions enough and organized labor, and labor in general that they CAN get out of them, even if the government was'nt in it they would give it up.
BTW, social security was started under FDR 401ks started going under in the 2000s, so your theory is shot down from the get go.
YOu should trust them government more, because you can vote for the government, and legally at least they work for you. Exxon does'nt even need to pretend to work for you.
Thats a great theory except in real life it does'nt work. In todays society you MUST rely on big corporations, because they control the economy, its all good and well to say "grow up and take care of yourself" but in practice you need a job, you need a bank account, you need return you need to interact with society.
Its not a matter of individuals or institutions, the economy is always going to be a social issue, the question is who runs it, the people, or the elite.
I said in the last 30 years, hell since FDR corporate power has been pulling the country more and more to the right.
SOcial security is not a hand out, we PAID INTO IT, its OUR money, we are entitled to it.
The question is not the individual vrs society or big government. the question is democracy vrs ologarchy, the proposals you put forward are nothing more than a transfer of power and wealth from the public to the buisiness class, in the name of individuals.
Why does'nt it work, except for corporate power?
YOu take away corporate power and it works, hell it works even with corporate power trying to destroy it.
The fact is your apeal to individualism is nothing more than an attack on democracy and a defense of corporate power. The rich are very few in numbers but much larger in money, which is why they have a distain for democracy and a love of markets, which is why they want everyone to be isolated as individuals economically because they can rule easily that way, and you and your tea-party ideology simply plays into their hands.
Your argument is really, capitalism ruin democracy, so lets get rid of democracy, well I don't by that, I say get rid of capitalism.
As it does, get rid of the cap and it will do so probably forever.
Wow, what a great argument. First, you fav his comment, than you write that you think he understands economics. I am thoroughly convinced.
You (that's you Bud, inyourhouse, and also the host of that show) are making a very basic mistake if you think and argue about things on the macro level like on the level of a single household. And yes, if you do that you do fail at macro.
I think it's dangerous to think of years like 2025 and 2037 as far into the future because it breeds complacency. As I said before, it's my view that the earlier reform is implemented, the easier it will be to transition. It certainly won't do any harm to prepare for what may happen.
Cutting defense spending will only ever be a temporary solution because it's a finite budget to cut from. It doesn't address the fundamental mismatch between revenue and expenditure. Raising taxes on the rich would help in the short term (although it would not be sustainable with a continually rising average age), but as I said, I don't see any need for it. I think it's possible to move to a system of compulsory saving and government top-ups (similar to that in Singapore) that will not require cuts in benefits or increases in taxes (in the long run; the transition would probably require both).
The current structure of Social Security in the US is that it is in something of a bubble, but I agree that it would be prudent to move away from such a system in the short run. In the long run, though, I do think a self-financing system is the only way to go. Otherwise we will end up with Social Security expenditure taking up a larger and larger proportion of the government's budget each year as the average age of the population increases.
This is not a long term solution. The Social Security Administration did a report in 2005 estimating that eliminating the cap would prevent the annual balance of Social Security from going into deficit only until 2025. As mentioned in my previous post, with everything as it stands (ie. including the cap) Social Security will start running continuous annual deficits in 2016, so all eliminating the cap does is extend its life by 9 years. Keep in mind that this is also a static analysis and therefore doesn't take into the account the negative effects on growth and productivity of such a large tax increase. You can read the report here (see Table E1 for the figures): http://www.ssa.gov/OACT/solvency/adv...d_20050810.pdf
Perhaps I was mistaken then, in which case Social Security is in a lot more trouble than the projections I listed suggest. Can you provide a link about the Trust Fund being used to pay for war? Also, the host in that debate said that it was used to pay for the Bush tax cuts. Do you agree with that?
I think that's necessary. It seems to me that for a Social Security system to be sustainable in the face of a rising average age, it must earn a return. The smallest and most risk-free return comes from saving, hence my suggestion for compulsory savings accounts. Investment in the stock market earns a higher return in the long run, but it's more risky, so I think it should be optional. I suppose you could consider that giving Wall Street a lot of money, but what matters to me is the sustainability of the system. The current unsustainable system will only hurt the workers who have paid into it; my proposal may help Wall Street, but it would also help workers.
Something I forgot to mention earlier is that a compulsory savings system also has positive macroeconomic effects. The most obvious effect is that it raises the savings rate, thus increasing the capital stock and leading to a higher rate of growth. That would benefit both Wall Street and workers too.
The vast majority of Social Security would be provided through accumulated compulsory savings. Taxes would only be necessary to top-up accounts, so the overall tax burden would be smaller. Even if you're counting the compulsory saving as a tax, the burden would be smaller in the long run because savings and investments earn a return, so any given level of benefits can be supported with a lower amount of money taken from payrolls.
Thanks. I don't post often, but when I do I try to make them as informative as possible.
I agree.
I'm not entirely sure what you're saying here. It's perfectly possible for the world savings rate to rise.
That's a given, but I think people want stability and to know what to expect so that they can make appropriate choices today (e.g. supplementing their Social Security with a private pension). Waiting for the Trust Fund to be exhausted and then suddenly instituting large benefit cuts and/or large tax rises isn't conducive to long term stability. It's also completely unnecessary because there are ways to make Social Security sustainable.
It goes without saying that a government issuing its own fiat currency can increase the money supply as much as it desires, but that is not a sustainable way to fund government spending as it leads to increasing rates of inflation. The only way taxation could prevent this is if the money taxed was permanently taken out of circulation, but in that case there is no point to the whole exercise. The government might as well have just raised the money through tax in the first place.
A ridiculous privatization plan. For starters, individual purchases of health care options will raise prices and costs, a problem already present in a privatized health care system. Furthermore, your plan will have the net effect of depreciation of social security benefits via stock market speculation. I'm not sure why you would promote such a plan unless you had a vested interest in an expanded finance sector.
I'm only talking about retirement accounts. Funding health care is a different issue.
I'm not sure what you mean by this. Are you saying that individuals investing in the stock market would suffer from lower benefits? I don't think that's likely to be the case because stocks have outperformed savings over every 47 year (retirement age [assumed to be 65] minus adult age [assumed to be 18]) period in history. Indeed, stocks have outperformed savings over all periods greater than 5 years. Anyway, in my proposal investing is entirely voluntary.
I promote it because I think it is the best Social Security system possible. If you disagree, please feel free to criticize it. I am always open to new ideas.
Whether it is "voluntary" or not means nothing in terms of what the net effect will be when socsec is privatized.
Sure, take off the cap.
The government top ups would require some sort of taxes. Cutting defense spending is not really a temporary solution, given the HUGE amount of money wasting on that, also the continually rising age is not indefinate, demographics chage all the time, so even the 2037 prediction is'nt accurate.
Also the taxes on the rich is'nt really short term either, keep in mind 2037 is just when the surplus will end, you still have all that money, so privatizing social security is not only unnessesary, its actually detremental to the budget, because those top-ups won't pay for themselves.
What I'm saying is that Social security is'nt seperate from the rest of the budget.
As far as self-financing, your system is'nt self financing, all you've done is privatised it, make it FOR profit (thus your gonna loose some of the benefits), and make the govenrment pay the top offs anyway.
But SOcial security is'nt taking a larger proportion for a long long time, even then, demographics will change.
ALso privatizing it is'nt gonna change the demographics problem, all your doing is adding profit to it and taking out democratic control.
Privatising it won't end that, all its gonna do is put a profit motive on it (which means higher overhead) and end up cutting into the budget anyway with the top-ups, thats not a solution.
Tax increases don't have a negative effect on growth or productivity. Trickle down economics have been disproven time and time again.
I don't have the link off hand right now, but you can look it up. As for the Bush Tax cuts, they arn't paid for, so they are cutting into the budget, had they been in place the Bush tax cuts could have paid for things that the social security fun did instead. So yeah.
Are you honestly arguing that Wall Street is more stable? And sustainable?
Again, thats trickle down economics, which has been disproven time and time agian.
Considering the way things are now, those top-ups are going to be a large part of it. Savings and investments sometimes earn a return, but who's gonna take most of it (if you guessed the banks your right), and when they don't who's gonna take the hit (if you guessed the taxpayers then your right as well, assuming the accounts are federaly insured, if not, then its just the people).
But either way, the demographics problem does'nt go away.
Except when the bubble bursts.
Its really just away to stop rich people from paying for poor people, and allow banks to make money from poor people by law.
The point is that money doesn't conserve energy.The point is that currency devaluation isn't magically equal to the spending/taxing gap. Hence, a government that aims at high employment and low inflation should not aim for a "balanced budget" over any period length, but set taxing and spending according to their impact in respect to these two aims. In fact, terms like "budget" lose their meaning on the macro level.
The overall point is that your statements about the macro level are made like statements that are adequate on the micro level and only there.
