AP falsely claimed Social Security program "is forecast to run out of money around 2041"
In a November 19 Associated Press article, reporter Beth Fouhy wrote that Sen. Hillary Rodham Clinton (D-NY) and Sen. Barack Obama (D-IL) "have traded barbs over" the Social Security program, which she identified as "the retirement program for seniors ... forecast to run out of money around 2041." Fouhy's assertion, however, is false -- as Media Matters for America has noted several times; while the most recent Social Security trustees' report forecasts that the Social Security trust fund will be exhausted by 2041, according to the same report, the program will not "run out of money" when the trust fund is depleted.
The trustees' report explains: "Even if a trust fund's assets are exhausted ... tax income will continue to flow into the fund." The report adds that, for Social Security, under current law, "[p]resent tax rates would be sufficient to pay 75 percent of scheduled benefits after trust fund exhaustion in 2041 and 70 percent of scheduled benefits in 2081."
From Fouhy's November 19 article:
Polls show Clinton locked in a tight race with Obama and Edwards in Iowa more than six weeks before the state holds its caucuses Jan. 3. A new Washington Post-ABC News poll shows Obama with 30 percent support among likely Democratic caucus-goers and Clinton with 26 percent and Edwards with 22 percent. The poll showed that about half of Clinton supporters said they had never attended a caucus; 43 percent of Obama supporters said this would be their first caucus. The finding is significant because voters considered the most reliable caucus participants are those who have caucused before.
Clinton, in her speech, also tackled the issue of Social Security.
In recent weeks, Clinton and Obama have traded barbs over the retirement program for seniors, which is forecast to run out of money around 2041. Presently, the first $97,500 in individual income is subject to the Social Security tax -- a level Obama has said must be increased in order to keep the program solvent.
The report adds that, for Social Security, under current law, "[p]resent tax rates would be sufficient to pay 75 percent of scheduled benefits after trust fund exhaustion in 2041 and 70 percent of scheduled benefits in 2081."
Ok. How do we get the other 25% and are you sure Hillary and Barack aren't trading barbs over that?
I say we sell the headstones of baby boomers for raw material $$, and I'm only half kidding, because raising my already ridiculously high contribution of money I'm never going to see back (I'm 24) already makes me sick.
Many of the less fortunate in our society DEPEND upon their social security check for the majority of their retirement income. A 20-25% REDUCTION in those benefits would be devastating.
Yet, MMFA continually downplays the BANKRUPTCY of the system, callously remarking that the system will still be able to pay 75% of its obligations.
Here's a clue: If you are unable to meet 100% of your obligations then you are bankrupt and have no money. Paying ONLY 75% benefits is not acceptable. You think the people who rely on SS can afford a 25% cut?
MMFA's argument is a cold one.
They do seem to be ok with it being short over any kind of real reformation, don't they?
I just think there should be an opt-out.
Flatly stating SS is going to run out of money in 2041 is a lie.
What's your point in relation to Bruce's question?
Bankruptcy doesn't always mean "completely out of money".
Unless I've got it wrong, isn't the report only making a projection about the trust fund (reserves) based on current tax rates, while stating the obvious fact that money will still be coming in to the system?
Seems pretty straightforward.If I went to Vegas this weekend and took a beating at the card tables, I could project that my savings account would be depleted if I did that every weekend.
But unless I got so wrecked in Vegas that I didn't go back to work for a few weeks, I would still have an income.
Except that you're legally committed to go to Vegas and lose every weekend.
I am?
Vegas is for Chumps, HBL.
When I get my first check, I'm going out and buying Lottery tickets.
That sounds like a pretty good plan, King. Unfortunately, it seems that a law has been passed requiring me to go to Vegas and lose every weekend.I hadn't heard anything about it..
Why argue against MMFA when the real issue is there is no plan on the table other than desolving the program in favor of putting the money in the stock market? The US dollar is weaker than a rat on vicaden and no one's complaining. At least MMFA is keeping the issue on the table.
So we can put you down as 100% against any form of deficit spending then?
Thanks for the laugher MMFA!
SS will be exhausted by 2041 but will not run out of money.
Typical liberal logic. :-)
Actually MMFA is reporting that the SS trustee's report says.
I'm noticing a lot of right wingers don't even bother to read what MMFA is posting.
Anybody else noticing that?
Here's an idea: try paying 80% of your mortgage or 80% of your car payment for awhile and see if your creditors think you are "out of money" or not.
You seen to want to redefine what "out of money" means for the sake of your argument.
I don't blame you, to tell you the truth.
You don't have a leg to stand on otherwise.
Johnny, you're being intellectually dishonest and you know it. The SS fund no longer being self-sufficient, with no reforms in place, is out of money. If you owe more than you can pay, you're out.
I agree some tweaking is necessary.
Alarming people, implying there's no money to pay any benefits without a complete overhaul is what's dishonest.
It's a lie to say SS will run out of money. To say it is going bankrupt is technically correct, but the article said "run out of money". When many/most people read "run out of money" they're thinking of 0 money in the SS system. This is wrong, and MMFA is just trying to point this out.
Interesting point. I guess it would be safe to say that the Pentagon went bankrupt years ago.
You are on the right track, but even more accurate would be to say, "Social Security will go bankrupt if we do not make any adjustments to it, regardless of how minor, anytime in the next 35 years." That is what makes this argument so dishonest, Dex and Bruce.
Yeah, Johnny, that's pretty standard. I was giving Jeter a little ribbing about misreading a thread, but that's only because it's obvious from his posts that he normally reads the material and applies his own thinking to it.
Many others seem to read the headline, and have a trigger (set by Rush Limbaugh maybe) that churns out an automated post.
The best part is that the ones who do this most routinely aren't affected by having it pointed out day after day that they're commenting on something cooked up in their own little imaginations.
It's entertaining up to a certain point.
This is such b.s. If you saved your annual letters from SSA over the years, as I have, you'll find that the "dip into savings" and "run out of money" (sorry, I'm at work and don't have the actual terminology) forecast dates have always been about 35-40 years out. Ten years ago it was 2032 and 2038. Five years ago it was 2036 and 2040. Next year the estimates will be a year later than they are this year. So, what's the solution to this "problem"? Private accounts (invested in the stock market, no freakin' less) to the tune of $8 billion taken out of Social Security funds and given to private investment firms, of course! Who makes money on this deal?
You're right, unhip. I want all my SS money back to put in an account on my own, not what the gov. sets up for me.
I feel you should have the option of the two. THAT, would be fair.
Sounds super to me!!!
and if your account goes bust because you invested in ostrich futures? it will be alright to step over your homeless starving self on the sidewalk?
That's a damn good point for the strict father conservatives to consider. There's no insurance or assurance that individuals will make smart decisions in the market. And if they get ruined in the stock market are they going to have the fortitude to carry on without grousing that they jeopardized their family's financial security? Heh. Sure they will
It's been said many times before but it still holds true; our democratic government is like an insurance provider with an army.
Well, in that case, I'd like to opt out of paying for police and fire services. I think I can do better on my own, and from this point forward, I will not pay taxes toward those ends.
Dex, do you have parents, grand parents?
Do you really believe that most Americans have the knowledge and good judgement to keep their investment growing year after year? How's your 401k doing? I remember in the mid nineties that some people lost almost half of their investment, since they were in riskier investments.
I'm close to collecting myself. I know how you feel. But I also remember when I was making less than $100 a week, with children to feed, that my SS tax was paying my grandmothers grocery bill. I was happy to pay my share.
But then again, I understand what living in a society means. It has more monetary responsibilities than it does benefits. But the then again, most of the benefits can't be counted.
Social Security is an inter generational trust. My parents paid for my grandparents, I paid for my parents and now my children are paying for me.
It's not a perfect system. It needs some adjustment. Hopefully we'll be able to make the right adjustments.
Privatization will be a windfall for the banks and investment houses and a nightmare for those who understand the meaning of those two words, Social and Security.
that's a big part of it. if we are made to invest our "individual accounts" through a wall street brokerage, they will not be doing that for free. they will take their cut off the top.
Unhipcat, I've noticed the same thing, the projected 'breakeven" point (for the lack of a better term) keeps moving out. I don't understand this. SS funding is dependent on payrolls and the economy is flat (so I've heard). Flat economy and growing SS Fund, these seem incongruent. What gives?
The economy is not flat. It's tilted, as in unequal.
Productivity, corporate profits, executive salaries and the cost of living are up. Living wages and job security for working people are down. That's an economy that is unequal, unfair and just plain bull%hit. Our economy, the strength of our nation and our government depends on working people so it's absolutely fair and just for our government to do what is neccessary to protect SS forever.
Markets are not concerned about the public good, they are concerned with the private profit. Therefore the market will not serve the common good it's not in their interest. Government will serve the people, it's our government, it's in our interest to look out for each other through our public institutions.
We can take a huge burden off of SS by raising the cap on earned income, start making the bloodsuckers pay as high a rate on their capital as I do for my labor and finally reign in executive pay to reflect their worth in productivity, you know link pay to productivity.
Everyman for himself conservatism is dead.
But, but if the economy is flat or non-existent for those of us at the lower ends (under $98,000), how can there be enough $$ flooding into SS to move the forecast out a year or two every couple of years?
What? I don't understand the question. It seems to assume that taxes don't exist or that the responsibility for keeping SS strong lies solely with lower income earners.
It's really a matter of spending priorities. Do we want to keep giving kickbacks to corporations for campaign contributions? Do we want to build a bulky military? Or do we want to invest in the welfare of our people?
Bruce,
These the same folks who whined when W increased funding for SCHIP (at the expense of my cigars) but advised that it was going to be underfunded. Welcome to Leftyland. Because it was an increase that did not cover everyone, which is what the other side really wants, it was not acceptable.
What? GWBush doesn't have the power to increase or decrease funding.
When you say "raising your already ridiculously high contribution", whose proposal are you referring to?
I see Obama noted here saying that he wants to raise the amount of income that is subject to the SS tax. I take that to mean if you make less than $97.5K, your contribution will only go up if your income goes up, but if you make more than that amount your contribution will go up regardless.
If you are making more than $97.5K at age 24, then I want to know what you're doing and how you do it. :-)
Doh! This was in reply to Dexter's opening post.
I don't make that much. Pete, I wouldn't have a problem with Obama's plan except A) I have no faith that I'll get what I paid in back and B) I'll likely be floating boomers with it.
Social Security is a tax, not an investment. The money you pay in today supports today's retirees. If we privatize it, as the Righties want, what happens to the working poor who don't make enough to put any significant amount into an IRA? If you privatize most of it but keep enough of SS available for those who really need it, will the Righties promise not to whine about it? Of course not. They won't be satisfied until it's gone.
Nerz, just tax me and I can pretend it's going toward interstates or something, then. SS/Medicare is a line item tax on my salary check, so regardless of who it pays for now, it's supposed to come back to me, which it won't, at least not in the entirety that I paid into it.
Excuse me? You'll probably get far more than you paid in if you live to a decent age.
O Rly? These days one works till they're 70. Think I'll get it all back in 10-15 years?
I don't know about you, but I plan on retiring at 55. You'd have to be nuts to want to work until your 70!
Would you take a larger issue with Iraq than you already due if there was a tax on your check that was line-itemed "War tax"?
Actually, trying to pay for this war through taxes would have been the responsible thing for Bush to do rather than claiming Iraqi oil revenues or the tooth fairy or whatever was going to pay for it.
War would have been over a long time ago. And the economy probably would have tanked, too.
If the 24 year old posting here (sorry, I forget your name) wants to know where his money is really gonna go, it's to pay the interest on the Iraq war bill for the better part of his life.
Dex, perhaps I can't be totally objective since I will hit retirement before 2041. I don't know what the solution is...it definitely needs to be fixed. I don't think privatizing it is the answer, even partially. Removing the ceiling completely would help, but will never happen because it would be an additional tax on those who can most afford it, and the Republicans will fight that to the bitter end.
As for a war tax, I have often proposed an Iraq tax on everyone who voted for Puddinhead George in 2004. After all, Numbnuts himself said the election was a referendum on his war, didn't he?
I think the war tax is a beautiful idea.
My point was more that if you're going to create a safety net that really isn't get-out-what-you-put-in for everyone, then just include it in the income tax you take and don't make it a line item, because then you're just ramming home the fact that you're taking my money with no promise of return, when I could put it in a 401k or some other annuity myself.
Nerzog,
Since Bush won the election, why not tax all those who voted against him? After all, their candidate lost. Seems like losers pay in bets don't they?
ps. I am just kidding. I know you are just ranting. I couldn't resist having a little fun with it.
Take care everyone. Fun discussions today. :-)
AA, your bet analogy is interesting, as many Americans look at an election as a bet or a sporting event. I've even heard people say they were going to vote for a particular candidate because, according to the polls, he was going to win . It goes along with the mob mentality and sheep-like instincts at the lower levels of human nature.
If I had to compare an election to a bet,I'd look at it another way.we're betting as a team (the U.S.) and deciding which way to bet by voting. If the majority picks a loser, why would the minority be at fault?
Or more simply; we're a group of friends deciding on a restaurant by voting. The majority picks a crap-hole, everybody gets sick, and you'd expect the minority to pay for dinner because they lost the vote?
Have a good thanksgiving,AA. You may want to give a little thanks, before digging into that turkey, that you'll probably be losing more bets in the near future, but paradoxically, we'll all be winners.(relatively speaking)
SS is not going to run out,If the gov would stop spending the extra that is comming in now there would be no problem.SS takes in around 330 million more then it pays out,The fed spends the rest and gives us the IOU (Or the middle finger) Remember Al Gore wanted the (Lock Box) You righties just voted for the wrong person in if your so worried about money.
COPIUSLACKOFJUSTICEANDTRUTHINUSABH90210 FACT CHECK:
Thanks to the democrats draining the lizard during tinkletime we are now running out of playdough on the monopoly board. The car and iron are lost and the spinner lands on 6 which is why the social security program never gets landed on.
Now that we have the facts to see, I have to call this one for Jerry Falwell because he was right, tinky winky was gay.
I always preferred the Top Hat, but my older sister usually pulled rank on me, and I got stuck with the boot.
This complaint is unnecessary hair-splitting.
The Republicans trying to privatize Social Security have falsely stated that SS will be broke in the short term. That's the BIG LIE. That issue is not in play here.
Parsing the meaning of the phrase "run out of money" is pointless. Does Media Matters have a better choice of words?
What do you call it when you are unable to pay all your obligations?
The correct answer, like or not is: "Bankrupt"
Is that the word the AP should have used?