More Social Security misinformation on Meet the PressJanuary 18, 2005 4:01 PM EST ››› ANDREW SEIFTER
On the January 16 edition of NBC's Meet the Press, moderator Tim Russert once again advanced the administration's highly debatable argument for the privatization of Social Security. On the program, Russert misleadingly suggested that the Social Security trust fund will be exhausted by 2029 by quoting an outdated 1998 remark by former President Bill Clinton that relied on projections at that time. Russert also failed to correct Bush counselor Dan Bartlett's erroneous assertion that private personal accounts are "part of the solution" to the problems facing Social Security.
In an interview with Representative Rahm Emanuel (D-IL), Russert quoted the outdated 1998 remark by Clinton to falsely suggest that Social Security will no longer be able to pay out full benefits for retirees in 2029:
RUSSERT: Let me turn to Social Security and put a quote up on the board. "...the looming fiscal crisis in Social Security. ... If nothing is done by 2029, there will be a deficit in Social Security trust fund, which will either require ... a huge tax increase in the payroll tax, or just about a 25 percent cut in Social Security benefits." Do you agree with that?
But Russert neglected to mention that, while Clinton's remark -- made February 9, 1998, at Georgetown University -- accurately reflected projections at the time, more recent projections by the Social Security Board of Trustees have significantly pushed back the estimated date for a deficit in the trust fund.
Clinton's claim that "there will be a deficit in Social Security trust fund" by 2029 accurately reflected the estimate of the 1997 report of the Board of Trustees of the Old-Age and Survivors Insurance and Disability Insurance Trust Funds (OASDI). But, as the Board of Trustees noted in its 2004 report: "Assumptions are reexamined each year in light of recent experience and new information. This careful review and updating of the assumptions on an annual basis helps ensure that they provide the Trustees' best estimate of future possibilities." According to the 2004 report, the Social Security trust fund will be able to fully pay promised benefits until 2042*. The estimated date is 2052, according to a June 2004 report by the nonpartisan Congressional Budget Office (CBO).
So not only did Russert use an outdated quote, but he used one that undermined his point rather than reinforcing it. By confronting Emanuel with the Clinton quote, Russert was trying to claim that Democratic leaders had previously espoused the view currently advanced by the Bush administration -- and promoted with substantial help from the media, including Russert -- that the system is in crisis. But the Clinton quote illustrates that Social Security is in fact on sounder financial ground today than it was six years ago.
In his interview with Bartlett, Russert initially challenged the impact of personal accounts on Social Security's solvency, but then failed to correct Bartlett's erroneous suggestion that private accounts could be "part of the solution to the [Social Security] problem":
RUSSERT: There's going to have to be other changes, reduction of benefits, raising the income where people pay tax on Social Security. Simply privatizing accounts will not solve Social Security problems, correct?
BARTLETT: President Bush has put on the table his ideas and principles that will guide a Social Security reform effort. First and foremost, benefits for those on retirement or near retirement will not change. He also said it's important that we don't raise taxes. It would be disastrous for our economy and it would be disastrous for American workers. He also believes that personal accounts are a part of the solution to the problem, to help give people a greater sense of return.
RUSSERT: Part of the solution but not the total solution.
But contrary to Bartlett's suggestion that private accounts would constitute "part of the solution," the implementation of private personal accounts could in fact reduce the planned retirement income for seniors, as Media Matters for America has noted.
While the details of the Bush plan are not yet clear, The Washington Post paraphrased chief Social Security actuary Stephen Goss, who based his comments on a plan that "Republicans close to the White House" outlined for the Post, as saying that if such a plan is enacted, total expected retirement income -- including guaranteed Social Security benefits and income from the new private accounts -- "would not match the benefits currently being promised." Media Matters has also noted that some economists believe that the assumptions about future equity returns -- on which the provided numbers are based -- are overly optimistic. Moreover, the administration has not articulated a plan for paying for private accounts in the short run, the costs of which are estimated to be $2 trillion, as the Post reported on January 12.
*When this item was first published, we incorrectly wrote: "According to the 2004 report, the Social Security trust fund will not be taking in less money than it is paying out until 2042. The estimated date is 2052, according to a June 2004 report by the nonpartisan Congressional Budget Office (CBO)."