David Axelrod: “This is not the time” to have a plan to reform Social Security

Hotair ^ | 09/24/2012 | Ed Morrissey

[sanjuanbob]

Not the time to fix social security; not the time for opening up drilling in America and not the time to draw a line in the sand for Iran...the only time in this President’s mind is his next tee time.

[entropy12]

Bump!

[kabar]

OBAMA ADVISER DAVID AXELROD: “Well I think that there, too, Mark, the approach has to be a balanced one. We’ve had discussions in the past. And the question is, can you raise the cap some? Right now Social Security cuts off at a lower point. Can you raise the cap so people in the upper incomes are paying a little more into the program? And do you adjust the growth of the program. That’s a discussion worth having. But again we have to approach it in a balanced way. We’re not going to cut our way to prosperity. We’re not going to cut our way to more secure entitlement programs – Social Security and Medicare. We have to have a balance.”

Idiot. The cap goes up automatically almost every year. In fact, under the Obama administration, the cap remained at $106,800 for the years 2009-11. In 2012 it is $110,100. By comparison, in 2000 the cap was $76,200 and in 1991 when Clinton took office, the cap was $53,400. And there is no earnings cap on Medicare (HI) payments.

Contribution and Benefit Base

[knarf]

Take it out of General Fund ... problem solved !

[kabar]

Take what out of the general fund?

[EGPWS]

What IS it time for Axlegrease?

[Hardraade]

This is not the time to have a muslim invader and his rat in the WH.

Arrest and prosecute.

[Hardraade]

Generals. And whip them good.

[jersey117]

Right! We’re supposed to wait until it totally collapses and no one gets anything. Got it.

[EGPWS]

Take what out of the general fund?

IOU's.

Problem solved.

[Just mythoughts]

Well I guess we know what Obama’s teleprompter will be telling him to say.

[miss marmelstein]

The creepily damp moustache speaks...

[kabar]

IOU's. Problem solved

Nope that won't solve the problem with SS. Here is how the system works"

SS is a pay as you go system. Today's workers pay for today's retirees. Money taken in thru the payroll tax is used to pay benefits. Any "surplus" is put into the General Fund and the Treasury issues non-market, interest bearing T-bills in the amount of the "surplus" and deposits them into the SS Trust Fund, which currently has about $2.6 trillion. The SSTF is part of the $16 trillion national debt and is held under "Intragovernmental Holdings" as distinct fromt he publicly held debt.

SS has been running in the red since 2010. It has been paying out more in benefits than it collects in revenue. To make up the shortfall, it cashs in the IOUs in the SSTF thru the General Fund, which just happens to borrow 42 cents on every federal dollar spent.

Source: CBO "Combined OASDI Trust Funds; January 2011 Baseline" 26 Jan 2011. Note: See "Primary Surplus" line (which is negative, indicating a deficit)

Matters are even worse than this chart shows. In December, Congress passed a Social Security tax reduction. Workers are temporarily paying 2 percentage points less, from 6.2 percent to 4.2 percent, in Social Security payroll taxes this calendar year. Since the government is making up the shortfall out of general revenues, CBO’s deficit projections for the trust funds do not include that. But CBO’s figures predict that the "payroll tax holiday" will cost the government’s general fund $85 billion in this fiscal year and $29 billion in fiscal year 2012 (which starts Oct.1, 2011.) Since every dollar of that will have to be borrowed, the combined effect of the " tax holiday" and the annual deficits will amount to a $130 billion addition to the federal deficit in the current fiscal year, and $59 billion in fiscal 2012.

Social Security has passed a tipping point. For years it generated more revenue than it consumed, holding down the overall federal deficit and allowing Congress to spend more freely for other things. But those days are gone. Rather than lessening the federal deficit, Social Security has at last — as long predicted — become a drag on the government’s overall finances.

As recently as October, CBO was projecting that it would be 2016 before outlays regularly exceed revenues. But Social Security’s fiscal troubles are more severe than was thought, and the latest projections show the permanent deficits started several years ahead of earlier predictions.

Even if the T-bills in the SSTF represented real money, it would not be enough actuarily to pay the future benefits. In the next 20 years we will double the population over 65. By 2030 one out of every five people in this country will be 65 or older. And by 2030 there will be just two workers for every retiree. SS is a Ponzi scheme. The people at the top of the pyramid will receive muc more in benefits than they put in. That won't be the case for future retirees.

[Wings-n-Wind]

[fella]

He's right, now is not the time for the RATs to put their the “Fix On” Social Security. They must wait until the “O” is reelected then they can nationalize our 401k’s either through a goosestepping RAT controlled Congress or Executive Order. Only then will the SS fix be in.

[Vaduz]

The Obama administration is flat clueless about everything they only work to change it to socialism.

[Hotlanta Mike]

Doesn’t Ax-Rod think it will come up in the debates?

[IbJensen]

Now is not the time to have a head full of mush named Axlerod discussing important policy issues. He and his boss are the problem with America!

[knarf]

1965 .. Lyndon Johnson took SS out of a(n) (untouchable) fund and made it General Fund so the politicians can more openly steal.