Social Security and the 2012 election

Via Greg Sargent (posted in “The Morning Plum,” link second from the top) who links to a Chris Cilizza’s post, I see that Obama and co. are looking to utilize Perry and Romney’s stances of Social Security to their advantage. Cilizza writes:

That strategy? Paint both Romney and Perry as extremists, having adopted positions on key issues outside of the mainstream of American thought.

On Social Security, for example, LaBolt notes that Perry has called the retirement program a “Ponzi scheme … and continues to question its constitutionality” while Romney “supports turning Social Security funds over to Wall Street.”

This will be mighty interesting to watch. The facts about Social Security are relatively simple. For a good explanation, check this out from Kevin Drum. For a good primer on debunking Social Security myths, read this from Digby.

If you don’t have time for the links, I’ll summarize: Social Security is a simple program. People pay payroll taxes into Social Security and that that money is given out in benefits to current SS recipients. This past year, Social Security began to pay out more money than it takes in. Social Security has run a surplus for some years, though, and this surplus, known as the SS trust fund, can cover the funds gap to pay out full benefits until 2037 (most estimates give this year). After 2037, Social Security will still be able to pay out 75% of benefits.

The funds gap we must close to have Social Security set for the forseeable future (’til 2100) is quite small as a percentage of our economy. The shortfall looks like this:

There are several ways we can solve this shortfall. We can cut benefits. We can “means test.” We can raise payroll taxes. We can raise the cap on payroll taxes so that rich people pay more. But the bottom line is that Social Security, with a few small adjustments, is fine. It doesn’t drive our debt. It doesn’t drive our deficit. Our health care system is what does that.

Barack Obama and his advisers know everything that I’ve just written. So why is this such an issue? Because the “fact” that Social Security is a huge part of our debt, those “unfunded trillions,” is an article of faith among Serious pundits in the Beltway. The sainted Tim Russert pushed this crap for much of his career. Chris Matthews, who apparently has no memory or understanding of irony and shame, mocks Rick Perry’s use of the term “Ponzi scheme” in reference to SS when he himself used that same supremely idiotic terminology only a few years ago. Peter G Peterson, a billionaire former Wall Street financier, has devoted much of his life to advancing this story line. Alan Simpson, co-head of Obama’s deficit commission, has spewed all of the classic bullshit lines about Social Security’s imminent bankruptcy. And these are ostensibly centrist people, not card-carrying members of the right-wing noise machine.

So: how will Obama handle this? From my memory, he’s been good at decoupling Social Security (which has a very minor funding problem) from the massive debt that our health care system will soon generate (that’s another nice sleight of hand that Very Serious pundits use, choosing the term “entitlements” to describe SS and health care when they well know that only one of those two areas drives the debt). Will Obama try to set the country straight on the relatively simple facts of SS, despite Washington’s pathological lying about this program? Stay tuned.

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4 thoughts on “Social Security and the 2012 election

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