one of four in the office when FDR said to develop Social Security - he went on to be the Chief Actuary of Social Security, retiring in 1970.
http://www.network-democracy.org/social-security/bb/whc/myers.htmlROBERT J. MYERS <1>
9610 Wire Avenue
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STATEMENT AT WHITE HOUSE CONFERENCE (1999) ON SOCIAL SECURITY
In order to be appropriate and meaningful, any necessary reform of the Social Security program should recognize the importance of two elements--its basic purpose and its current and long-range financial status.
Nature of the Social Security Program
From the inception of the Social Security program in 1935, it has always been a social insurance system designed as an income-maintenance plan in the event that certain risks occur -- currently, age or disability retirement and death of the worker (either before or after retirement). Conversely, it was not intended to be an investment plan, under which every participant is supposed to receive the same investment rate of return.
Rather, the Social Security program is a mixture of individual equity and social adequacy, with emphasis on the latter. For example, larger benefits relative to contributions are paid in some cases than in others -- e.g. (1) workers near retirement age at the start of the program, (2) low-earnings workers, and (3) workers with dependents.
Public education is based on social adequacy principles, rather than individual equity ones -- even more so than is the Social Security program. Thus, two families with the same number and ages of children receive the same education benefits, and yet the family with a mansion pays much more real estate school taxes (i.e., a lower rate of return) than does the one with a modest home. Similarly, a family which never has children receives a very poor "rate of return" on its school taxes (unless one takes a broader view as to what is good for the nation).
Current Financial Status of Social Security Program
From a short-range cash-flow standpoint, the Social Security program is in excellent condition. At the beginning of 1998, the trust-fund balance was $656 billion, an increase in the past 12 months of $89 billion. It is likely that, in the next decade, the annual excesses of income over outgo will increase to a level of about $150 billion. Thereafter, however, according to the intermediate estimate in the 1998 Trustees Report, such excesses will become smaller, and after a decade will cease to exist (and, in fact, will turn negative). As a result, the trust-fund balance will decrease and will become exhausted in 2032 (note: each year after the conference the exhausted date became a year later - 2043 per the SSA before Bush force some silly assumption changes this last year, and 2052 per CBO, and "never" per both under assumptions that mirror history and are no worse than 1% less growth per year than we averaged over the last 50 years).
A good measure of the long-run financial status of the Social Security program is the long-range actuarial balance. This element, expressed as a percentage of taxable payroll, if negative, indicates the increase in the combined employer-employee tax rate which would be needed immediately if the program is to be fully financed over the 75-year valuation period. According to the intermediate estimate, the long-range actuarial balance is -2.2% of taxable payroll. On the other hand, the low-cost estimate shows a small positive balance, while the high-cost estimate shows a much larger negative balance.
The conclusion to be drawn is that a significant, but not overwhelming, long-range financing problem very likely exists. This can be solved in numerous ways within the existing structure of the program. However, solving the problem by the simple, not too painful, method of increasing the combined employer-employee tax rate by 2.2% is not a complete solution, because insufficient financing would be present after the end of the 75-year valuation period.
What would happen if the assumptions of the intermediate estimate were exactly fulfilled, and the combined employer-employee tax rate were increased by 2.2%, is that huge fund balances would be built up in the next few decades and thereafter drawn down. So, at the end of the 75-year valuation period, the fund balance would be only one year's outgo, and a higher tax rate (by about 4%) would be needed thereafter. This would hardly be a reasonable way to solve the problem.
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1 Chief Actuary, Social Security Administration, 1947-70. Deputy Commissioner of Social Security, 198l-82. Executive Director, National Commission on Social Security Reform, 1982-83.
FELLOW, SOCIETY OF ACTUARIES
FELLOW, CASUALTY ACTUARIAL SOCIETY
MEMBER, AMERICAN ACADEMY OF ACTUARIES
FELLOW, CONFERENCE OF CONSULTING ACTUARIES
MEMBER, INTERNATIONAL ASSOCIATION OF CONSULTING ACTUARIES
MEMBER, INTERNATIONAL ACTUARIAL ASSOCIATION
As to the specifics of your post:
You told truth to his fiction that voluntary, deductible, and non-taxable was the original plan - "according to the SS administrations own website,all persons working in jobs covered by SS are subject to FICA payroll taxes, there was never a provision to make SS taxes deductible,(1935 law section 803 Title VIII).
The only thing you could have added was the collection of the tax by the IRS via payroll deduction was part of the law before the first tax was collected (early on the method of collection ideas included folks going to their bank and being required to make monthly deposits to the tax account). In any case it was never to be voluntary.
As to "LBJ abolished the SS trust fund transferring all money to the general fund" your "the SS trust fund was created in 1939, it was never put into the general fund" is correct but you might add that all cash collected by the IRS goes into the same accounting. In the accounting we changed in 1980 to including all trust fund activity in the report that stated what the "deficit" was - no real change in anything was made at that time or since. It was a change in the report, with the thought being that the new presentation of the budget "deficit" gave the markets the correct information as to how much borrowing strain caused by the Federal Budget would occurring (the Federal Deficit - new government bonds - is always the investment of choice for all Trust Funds, thereby financing the deficit. So including that Trust based financing in the report was said to make it clearer - it really just made the Reagan/Bush deficits look smaller than they really were.
Saying SSI - a welfare program, and Social Security - a pension or insurance program are the same thing, can not be replied to - it is just wrong. It is like trying to debate on Fox Cable when they just make up lies - it is pointless and a waste of time.
I am glad he now agrees that it was Reagan signing a bill to tax SS, and he is correct about Clinton changing that tax slightly while in office.
Dems are destroying everything in the UP IS DOWN WORLD of the GOP - and again can't be responded too - A fact that makes the media treating UP IS DOWN lies by the GOP as co-equal statements of "opinion" part of the problem of right wing bias in the media.
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