more doom-and-gloom on Social Security
AP's Martin Crutsinger on Bush's remarks yesterday on Social Security...
WASHINGTON (AP) - The Bush administration said Monday the only way to permanently fix Social Security is through some combination of benefit cuts and tax increases. That was one of the key findings in a new paper on Social Security released by the Treasury Department in an effort to achieve common ground on the politically explosive issue.
"Social Security can be made permanently solvent only by reducing the present value of scheduled benefits and/or increasing the present value of scheduled tax increases,'' the paper said. The Treasury paper said that while other changes to the giant benefit program might be desirable "only these changes can restore solvency permanently.''
According to the report, SS is facing a $13.6 billion "shortfall". And the benefits of SS are already pathetic-- a 1% rate-of-return on average. (I hope the lower economic classes enjoy the government mandating that they invest in their retirement this way.) And the taxes to support SS are already so painful-- 12.6% of every dollar earned up to about $100,000-- especially for the lower and middle classes. The funniest/saddest part of the whole thing is to see Democrats passionately defend this system-- out of ignorance or the most crass of political motives.
Bush put forward a Social Security reform plan in 2005 that focused on creation of private accounts for younger workers but that proposal never came up for a vote in Congress, with Democrats heavily opposed and few Republicans embracing the idea.
Thanks so much to the courageous Republicans in Congress. One of the few domestic/economic issues in which Bush has taken an interest and had an effective policy answer-- and most of the Republicans ignore it. (Aside from that, one could give Bush credit for one part of his two-part tax reduction.)
The Treasury paper said that there was a "significant cost of delay'' in making the necessary reforms to Social Security because it reduced the number of people who would be able to share in the burden of reform. "Not taking action is thus unfair to future generations...''.
Agreed. But putting a financial burden on future generations has not troubled Bush in general. So far, his preference has been to spend a whole lot of money and finance much of it with debt (i.e., higher future taxes).