SOCIAL SECURITY: THE DILEMMA OF THE WORKING MASSES

By: Dallas Foster


The President wants to change Social Security now while he is in the Oval Office so that he will not be considered a "lame duck" President like many others before him in history. President Bush wants this as his legacy as it was for Roosevelt's Presidency during the Great Depression. He feels that if he were to "fix" Social Security, he will go down in history as a great President and not the man who touched of a deadly war because of bad intelligence.

But what he is telling us is a lie or at least a half truth. He claims that "One way for a younger worker to come closer to what the government has promised is to be able to take a portion of the money and get a better rate of return on your own money than that which the Social Security system gets." But that's only true if you make more than a 3% return on your investment that you make with the 4 points that the President wants to give you. If you make lower than the 3% that Social Security makes, than you are worse off than if they just lowered your benefits in the first place. Also, he never explicitly says that there is a risk; he tells everyone to be conservative with their stocks and bonds and not to take their money to the track. But the fact is that all stocks experience a loss over a period of time, while Social Security does not experience a loss in value.

He also claims that "It's your money, and the interest off that money goes to supplement the Social Security check that you're going to get from the federal government. Personal accounts are an add-on to that which the government is going to pay you. It doesn't replace the Social Security system. It is a part of getting a better rate of return to come closer to the promises made." But this implies that the check you will receive under the new plan will be the same as it is with the current system and that the investment is an extra add-on to this money. But its not, it's a replacement for the money the government will need to keep the program up and running. So again, you could receive less than you would if we stay under the current plan and fixed it to work as needed.

Another false claim is that "You can pass that money [from a private account] to whomever you want." But again that is an untruth. What is really going to happen is this, under Bush's proposal a portion will be set aside by the government as an annuity and can only be paid to the tax payer it belongs to and can not be inherited by others. But the other portion is able to be given away as the taxpayer sees fit. So if this is our money why can't we give all of it away to our children or other loved ones when we pass? It is so that the government can use that unused part of your annuity to help Social Security to keep going. So again, not all the truth is coming out of our leader's mouth.

The next false statement about the new Social Security plan is that there is an $11 trillion dollar deficit. The President said: "If we don't act, we're looking at about an $11 trillion hole for the American taxpayer coming up. This is a big liability not for me or baby boomers ... but if you're a young worker, you've got a problem." The President incorrectly suggests that younger workers will have to deal with this shortfall if the program continues on its wayward course. This $11 trillion number according to the Board of Trustees report is over an "infinite" about a time not over the next 75 years that number is more like 3.75 trillion. So why all the lies about how much trouble Social Security is really in? Because the President is looking out for his own legacy and not what is good for the people that elected him.

So beware of all the false statements on Social Security and let's tell the President what we think of his cockamamie plan.