Saturday, November 10, 2007

The Social Security Con Job

The problem with Obama wanting to deal with "Social Security crisis" is that this political debate has long been waged under the Village rules, which include the lie that there is some kind of "crisis."

As long as any discussion about Social Security is framed with crisis rhetoric, a sensible discussion about possible changes to the program (utterly unnecessary, except for dealing with current underfunding of its administration) cannot be had.

The other part of the Village con job is that while they know it's "necessary" to raise payroll taxes in order to increase the Trust Fund, they don't believe in the Trust Fund. A typical Village story about the money in the fund looks something like this:

The most recent government forecast says that in 2017, Social Security trust funds will begin paying out more in benefits than it takes in. In 2041, the trust funds will be empty, and benefits will have to be cut.

The first sentence is completely irrelevant and the second is highly misleading. It's true that if projections were spot on and general funds weren't used to cover any shortfalls, benefits would "have to be cut" relative to currently promised benefits, but even those "cut" benefits would be higher than what current retirees get today, because as wages grow generally in the US, retiree benefits grow modestly as well.

There is no crisis. Stop it.