Sunday, May 30, 2010

Some Good Advice

One of my favorite blogs is Ronni Bennett's Time Goes By. It's one of the most informative blogs on elder issues, which is Ronni's primary focus. Anyone over 50 or related to someone who's over 50 can find a lot of useful information on "what it's really like to get older."

Yesterday, Pulitzer prize winning journalist Saul Friedman (a member of the team Ronni has put together) weighed in on Social Security and the ongoing attempt by our owners to dismantle the program and put all of that money into Wall Street instruments. He gives some good advice on what to do about the latest move by the yahoos and details the actual facts about one of the most efficient and effective programs around.

First, find out if you have an IRA or other retirement saving accounts with a bank or brokerage or investment house that has been calling for the privatization of Social Security. If so, transfer the account (without penalty) and tell the broker why.

Nothing gets the attention of the money-people faster than the withdrawal of an account, no matter how small. If enough people with IRAs (and lots of people have them in addition to any 401k account at work) start getting cranky about the machinations of the people who are supposed to be working for their customers instead of against them, it might let out a little air in that balloon.

Mr. Friedman also has a few choice words on the stale baloney being passed out by the yahoos as "facts" concerning the imminent bankruptcy of the program and its potential effect on the federal budget:

...since the fixes of 1983-4 by the Reagan administration and Alan Greenspan’s commission, Social Security has run a surplus every year, enough to guarantee benefits for the huge boomer generation. Even this year and next, when high unemployment forces the program to pay out more than it takes in in payroll taxes, Social Security will still run surpluses of more than $100 million.

That should lead defenders to their main point, which they should repeat like a mantra: Aside from its administrative costs, Social Security’s benefits for 50 million Americans does not contribute even one dollar to the federal deficit. Let me repeat for reporters who are too lazy to understand Social Security: Aside from its relatively small administrative costs (which are in the Social Security Administration’s budget), Social Security adds nothing to the deficit.
[Emphasis in the original]

Does the program need tweaking? Of course it does. What program, whether public or private doesn't from time to time?

Mr. Friedman has some good advice on this point as well, backed up by the opinions of people who actually know something about money and how it should be used:

... if Congress abolished the $106,800 cap on the wages subject to payroll taxes, the entire $5.3 trillion shortfall would disappear. Obama has suggested raising the cap to $250,00. Interestingly, several of the nation’s more honorable billionaires, like Warren Buffet and Bill Gates - junior and senior - have called for an end to the cap, noting that they are paying no more in Social Security taxes than a well-paid secretary.

That shortfall, by the way, is not looming. The CBO predicts it will occur 75 years from now. Mr. Friedman's point is that we can fix it now with a simple raising of the cap on earnings.

I've decided that the next time some loafer-wearing, Mercedes-driving, fast-talking yahoo tries to tell me that I'd be better off with a privatized social security plan I'm not going to throw a shoe at him. I'm going to place one that I'm wearing firmly and resoundingly on his backside. And then I'm going to empty a whole can of whup-ass on his head. Thanks to Mr. Friedman, I've got the requisite ammunition to do so.

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Blogger PurpleGirl said...

Nice to know that Saul Friedman is still writing. When I was still buying Newsday I loved his column. Thanks for the link.

2:18 PM  

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