JREGrassroots > Is this Social Security threat a pile of BS?

Full Version: Is this Social Security threat a pile of BS?

JREGrassroots > General Politics > The Economy

ncMindy

Oct 2 2007, 03:53 PM

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Published on Tuesday, October 2, 2007 by CommonDreams.org

From WMDs to Social Security: More Bush Stories

by Dean Baker

You remember George W. Bush, the guy who tricked the country into a never-ending war in Iraq with stories about Saddam Hussein’s weapons of mass destruction and links to Osama bin Laden. Well, he still has 16 months left in the White House and he’s determined to do yet more damage with his famous “Bush stories” before he leaves town.

The latest Bush story is the cry that Social Security is going bankrupt and will impose an unbearable burden on our children and grandchildren. Of course, this is not the first time President Bush has gone after Social Security. Immediately after the 2004 election, he tried to use his new political capital to privatize Social Security. As a result of a massive nationwide organizing campaign, the privatization drive soon hit a dead end.

But Bush is not through with Social Security. In an apparent effort to lay the groundwork for a future president to privatize and/or cut the program, the Treasury Department is circulating a new set of Bush stories designed to convince the public the Social Security program must be changed.
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One of the main reasons Social Security is projected to face a shortfall is the government has implemented trade and labor policies that shifted income upward, away from Social Security-tax-paying workers. If we reverse these policies in the years ahead, then we could get a more equal distribution of income, and at the same time eliminate much of the projected shortfall.

Complete at LINK

Enjoyed the comments, especially this one. "Doesn’t anybody actually read in your godforsaken country? You have a Nobel Prize-winning economist — a former Head of the World Bank, i.e. Joe Stiglitz — saying that this Social Security threat is a pile of BS, and nobody’s listening to him."

ncMindy

Oct 15 2007, 01:58 PM

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I recall hearing Mr. Peterson pontificate for an hour, completely unchallenged, on a major public radio talk show. At one point, he assured his audience, with reference to the solvency of Social Security, "trust me, there is no trust fund." Mr. Peterson repeated this lie verbatim, just in case the meaning escaped his audience.

Of course, there is a Social Security trust fund that holds more than $2 trillion in government bonds. Under the law, these bonds are to be repaid from general revenue, which comes almost entirely from the personal and corporate income tax. In other words, the bonds held by the Social Security trust fund, which are supposed to pay the Social Security benefits of retired workers, are effectively tax obligations for wealthy people like Mr. Peterson. If the bonds held by the Social Security trust fund are never repaid, Mr. Peterson and/or his heirs could save tens of millions of dollars from their future taxes. It shouldn't be surprising he is trying to convince the public that the trust fund doesn't really exist.

But, this is just one side of Peter Peterson. He was in the news last week for a totally different reason. It turns out, a loophole in the current tax code allows hedge fund and equity fund managers (like Mr. Peterson) to pay taxes on their compensation at a much lower rate than ordinary workers. While middle income workers like school teachers and firefighters typically face a 25 percent income tax rate, Peter Peterson and other fund managers get to pay the much lower 15 percent capital gains tax rate on the tens of millions they earn each year.

According to The Washington Post, Mr. Peterson was actively lobbying Congress to ensure he and his ilk are not taxed like ordinary workers. The Post reported that Mr. Peterson's efforts apparently paid off: He and his fellow fund managers will continue to enjoy special tax breaks.

Pete Peterson Doesn't Need His Social Security

Emphasis added.

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