Economics

Treating the Elderly Like Spoiled Brats

The case against giving a tax-free bonus to Social Security recipients

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When inflation hits, every dollar in your bank account is worth less each day. Deflation is just the opposite: You put your feet up and watch your money grow in value. The latter is what is happening now to America's seniors. And politicians think they should not have to stand for it.

The other day, the federal government announced that for the first time since cost-of-living adjustments were begun in 1975, Social Security recipients will not get an annual raise in their monthly checks. This decision is not the result of a fit of fiscal austerity or a sadistic desire to punish old people. There won't be a raise to offset inflation for the simple reason that there has been no inflation to offset.

Last year, seniors got a big raise because consumer prices had jumped 5.8 percent in one year. In the following 12 months, though, the Consumer Price Index has dropped by 2.1 percent. So in the coming year, Social Security payments will stay the same and be worth more than they used to be.

But so what? Groups representing the elderly, like AARP, have come to regard the annual raise as a sacred birthright in good times as well as bad, and few in Washington want to argue with them. President Obama has proposed giving every Social Security recipient a tax-free $250 bonus in lieu of a cost-of-living adjustment. Congressional Democrats are all for it, and the Republican leadership sounds agreeable.

A consensus like that happens only when someone comes up with a simple, appealing, and thoroughly horrendous idea. As it is, the cost-of-living rules are a great deal for seniors. Retirees get more money when prices rise, but they don't have to give any of it back when prices fall. The ratchet works only in their favor.

It's not easy to make a case for enriching seniors at a time when working-age Americans are suffering, but Obama and his allies are trying. The president insisted that "we must act on behalf of those hardest hit by this recession."

Who is he kidding? His policy would help those with the most protection. The people hit hardest by the recession are those who have seen their earnings vanish along with their jobs. Social Security recipients are assured of a stable stream of income even when companies are cutting payroll with a chainsaw.

Obama also claimed the help is essential because "countless seniors and others have seen their retirement accounts and home values decline as a result of this economic crisis." What's his excuse for singling out seniors? Most everyone with a house or a 401(k) has gotten whacked, and the government can't afford to help them all.

What no one mentions is that Social Security beneficiaries already got a bonus in the original $787 billion stimulus package, which provided them with payments of $250 apiece. That's the rough equivalent of a 2 percent COLA. If the president gets his way, they will get a total of 4 percent. That, in combination with the drop in the CPI, means they'll have about 6 percent more in inflation-adjusted dollars this year than last. Not many other Americans can say that.

The final pretext is that the payouts will provide "a boost to our economy," in the words of House Speaker Nancy Pelosi‚ÄĒpresumably because they will spur spending. Trouble is, giving people money doesn't mean they will head to Walmart. When the Bush administration sent out rebates, most of the cash apparently went to pay off debt or bolster savings, neither of which spurs the production of goods and services.

"Because of the low spending propensity, the rebates in 2008 provided low 'bang for the buck,'" concluded a study by University of Michigan economists Matthew Shapiro and Joel Slemrod. "Given the further decline of wealth since the 2008 rebates were implemented, the impetus to save a windfall might be even stronger now."

The cost of this stimulus would be $13 billion, according to the White House. But if the $787 billion stimulus served its purpose, why is the additional boost necessary? If $787 billion didn't do the trick, what is $13 billion going to accomplish?

My suspicion is that most old people, given the facts, would be mature enough to understand that there is no good excuse for this windfall. It's the politicians who need to grow up.

COPYRIGHT 2009 CREATORS.COM

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  1. You’re just Ageist!

    Their memories may be failing, but they’ll still remember who helped them out in November! (or who did nothing!)

    1. Why are they the only group that can remember to vote in droves but they can’t remember where they left their teeth?

      1. Simple! The golden oldies subsist on a pureed diet; as long as you can slurp down your blended meatloaf and mashed spuds without aspirating, teeth become an afterthought.

        Now voting, on the other hand, has a bit more consistency to the seasoned ones of society.

    2. Neither my memory, nor my body are failing, and no one in the government has ever helped me out. All they have ever done is take from me, and continue to do so. And you are just showing your ignorance and that you have been indoctrinated by our wonderful “education”/indoctrination system.

  2. My suspicion is that most old people, given the facts, would be mature enough to understand that there is no good excuse for this windfall. It’s the politicians who need to grow up.

    Many would probably understand, agree completely, and then throw a fit and vote for “the other guy.”

    There’s a difference between knowing what you want is wrong and not wanting it.

    1. Maybe so, but how many people here refused their rebate checks in 2008?

      1. Why would I refuse my rebate check? It was my money and just a teeny weeny bit of what I paid in.

        1. Exactly. So why should retirees feel guilty about their little rebates? A good percentage of them will die well before they get back what they put into the SS system. How much more would they have if they were free to use their money as they saw fit? How many more businesses and jobs and opportunities would have been created by them if their money hadn’t been stolen by the government? We’ll never know.

    2. My suspicion is that most old people, given the facts, would be mature enough to understand that there is no good excuse for this windfall.

      Are we talking about the same people who, although they know every single penny was spent the second the government received it, will still scream “I paid in” at you?! Are we talking about those who regularly declare that THEY should receive a nice profit from the Great Ponzi Scheme at the expense of future generations?

      At this time in this thread, we are exactly one for one against that belief. The Greatest Generation of Thieves won’t pass up a cent.

      1. “It is obvious, in such cases, that a man receives his own money which was taken from him by force, directly and specifically, without his consent, against his own choice. Those who advocated such laws are morally guilty, since they assumed the “right” to force employers and unwilling co-workers. But the victims, who opposed such laws, have a clear right to any refund of their own money–and they would not advance the cause of freedom if they left their money, unclaimed, for the benefit of the welfare-state administration.”
        -Ayn Rand, June 1966

        1. But the victims, who opposed such laws, have a clear right to any refund of their own money

          First, which ones “opposed”? It has been the “third rail of politics” since I was a small child. If a person voted for a politician that supported the program, which includes 98% to 100% of voters, they were “opposed”?

          I don’t disagree that victims have a right to a refund, from the people who stole from them, which was not I. Stealing from me, based upon this “right” isn’t a “refund” but a continuance of the original crime.

          If someone mugs me, do I get to come to your house and claim a “refund”? I have been robbed in the past, but hey, you can afford a couple extra grand, right? Remember I have a right to a refund!

          and they would not advance the cause of freedom if they left their money, unclaimed, for the benefit of the welfare-state administration.

          Walter Williams has stated that he doesn’t cash his welfare SS checks. Being principled DOES advance the cause of Freedom. How on Earth does a person take from the Welfare State and proclaim it’s evil at the same time? Wealth transfers are evil, but hey, gotta get mine?

          1. If the government is going to take 6% or whatever for retirement from me, I’m sure as heck going to take advantage of the payout. Utilizing a forced savings plan doesn’t make me a bad person.

            Forcing me to turn over money makes them bad however.

            And if you cry when they try to take that plan away, while agitating for freedom, then yes, you are bad.

            But I fully supported Bush’s SS plan, even in light of “graphs” showing I would end up with less money under the plan. You know why – because I support freedom. Just because government is so big and intrusive doens’t that I can’t avoid it doesn’t mean I’m wrong for collecting from it.

            Were freedom loving Russians (all 3 of them) bad for relying on government bread lines?

          2. How on Earth does a person take from the Welfare State and proclaim it’s evil at the same time?

            Easy. He has a right to recoup some or all of which was stolen from him (plus interest). He has no moral duty to be a martyr, a sacrificial animal.

            1. Easy. He has a right to recoup some or all of which was stolen from him (plus interest). He has no moral duty to be a martyr, a sacrificial animal.

              I should have said, “how does someone, with principle, take from the Welfare State and proclaim it’s evil at the same time”

              Claiming “I got screwed so I have a right to screw you, with interest, isn’t a moral argument. Not fucking future generations is not being a “sacrificial animal” either.

              Can I assume that you favor paying, with interest, the victims of Bernie Madoff’s Ponzi scheme? They got screwed so everyone must pay?

              1. I don’t believe the government forced them to invest in his Ponzi scheme. I was robbed at gunpoint! Congress then took that stolen money and instead of “holding it for me,” they raided the fund and spent it on other things. They should be jailed with Madoff!

        2. Exactly

      2. Actually more than every penny was spent, but that was not my idea. Look at it as a tax cut. I would never vote to spend more…let the people who do refuse their rebate.

      3. If it is a Ponzi scheme, it is those who paid in who get screwed and those who get paid out of it without paying in who are the dead beats….like drug addicts and their $600/per month, the grandparents of the children of illegal aliens, youngsters who are injured while playing, etc. And, oh yes, those of us who served as unwillingly in the military as we were unwillingly forced to pay into Medicare and Social Security have not and are not taking away from the future or current generations, but have provided what you ungrateful little f%$ks are enjoying now, but will cease being available in the not too distant future because the society you desire will not provide jobs or a future for you. Hope you have a wonderful time taking care of yourselves.

  3. Good to see that in whatever situation the government is as clueless as ever.

  4. ooo, is that a picture from the upcoming sequel to shawshank redemption?

    1. Heh. No, it’s from Bubba Ho-tep, the greatest Elvis movie ever.

  5. I’m a Social Security recipient but I’m against getting this extra money. I would make a small argument that the cost of living has not gone down. Food prices are up and rent has not been reduced.

    1. Opps, my apologies, Chris. I focused on the part about expenses and spaced out on your first sentence.

      Correction for above. We are one for one opposed to the increase. Maybe there is hope after all.

      1. It’s merely vote-buying under the guise “helping our seniors” by appearing to be compassionate ala’ “Hope and Change”.

  6. Maybe I’m too kind-hearted, but if we’re just going to be throwing billions of dollars around, I’d much rather some of those billions go to senior citizens rather than the banks.

  7. ooo, is that a picture from the upcoming sequel to shawshank redemption?

    No, that’s Bubba Ho-tep. Bruce Campbell plays Elvis Presley and Ossie Davis is John F. Kennedy with half a head of sand. They fight off an evil mummy in a rundown nursing home. Great movie.

  8. A consensus like that happens only when someone comes up with a simple, appealing, and thoroughly horrendous idea.

    This is why precisely why I want to regurgitate when I hear that worn-out-like-a-French-Whore’s-snatch buzzword “bi-partisanship”.

    Such a useless and throw away term; I know many who post here detest partisanship, but quite frankly, the more gridlock in Congress the less damage they can do.

    See Bill Clinton’s second and more successful term as POTUS.

  9. I know many who post here detest partisanship

    Really? I don’t there are many. (Actually, I can’t think of any except for Chad/Morris/Leftittie/et al.)

    1. Perhasps I should clarify: besides the posters you mentioned, Episiarch has posted of his contempt for partisan hackery.

      I believe MNG has as well.

  10. We’re suffering from parasitic gerontocracy. Social security was created when I was not born yet and consequently couldn’t vote against it.

    1. Most of the recipients today would not have been old enough to “vote” for SS in 1935. They were born into it. Money was taken from them regardless of their views on the subject.

      1. It was today’s SS recipients duty, to wipe out the fools who did vote for it when they still had the chance.

        1. Wipe them out? Let me know when and how you’ll be “wiping out” today’s statists.
          Be specific.

  11. I guess Grandma will be able to buy that big screen TV after all.

    My suspicion is that most old people, given the facts, would be mature enough to understand that there is no good excuse for this windfall.

    What about the people who have to supplement their retired parent’s benefits? Do you think they would understand?

    How about Mr. Ken Lewis? Do you think he, and his $64 million retirement package, would understand?

    Would people in Alabama, where the median income is about $25,000 be more understanding than people in Connecticut where the median is $62,000?

    Would people earning over $106,000 understand?

    The fact is, the Social Security system is so screwed up, that whining about a $250 windfall(?) is just petty bullshit. Remove the wage cap, cap the eligibility, and give the people who really need it, something they can actually live off of. Social Security should be the safety net it was supposed to be, not the annuity people want it to be.

  12. Social Security should be the safety net it was supposed to be, not the annuity people want it to be.

    Regardless of income eligibility, most are not inclined to turn down extra money, particularly with the mindset of “I paid into it, so I’m getting mine back!”

    1. I know. That’s the problem. And that mindset goes across the entire income spectrum. Meanwhile, the people who really need it, are the ones getting screwed, in the long run.

  13. [Bart and Lisa explain that they used Grampa’s name on their script]
    Bart Simpson: Didn’t you wonder why you were getting checks for doing absolutely nothing?
    Grampa: I figured ’cause the Democrats were in power again.

    1. I didn’t earn it, I don’t need it, but if they miss one payment, I’ll raise hell!

      1. I’m OLD! Gimmie gimmie gimmie

  14. [It’s Bart’s birthday and grandpa’s present to him is a big box of money.]

    Marge Simpson: Where did you get all the money?

    Grandpa: The government. I didn’t earn it. I don’t need it. But, if they miss one payment I’m gonna raise hell!

  15. AT,

    It was the obvious Simpson’s quote. Abe (read: me) is just 2 minutes faster than you.

  16. I’ve longed maintained that the federales can keep every last cent they’ve taken from me in FICA taxes, if they let me opt out of the system completely. The last statement from SS showed that I’ve “paid in” about $150K. It fucking *kills me* to think the return I could have gotten on that over the last 30 years, or at least how much cool stuff I could have bought with it.

    I won’t make any claims when I retire and I get 12% of my income back to invest as I see fit.

    For some reason, that makes me a selfish bastard, wanting to have a reasonably comfortable retirement and not be a parasite on everyone else.

  17. It amazes me that money even has value anymore.

  18. We could call this, “Cash for Clunkers II”

  19. Fuck socialist security with an obsidian-tipped Mayan war club. The social security office in my town is near the bar district. I pissed on their door once.

  20. My suspicion is that most old people, given the facts, would be mature enough to understand that there is no good excuse for this windfall. It’s the politicians who need to grow up.

    These would be the same old people who hear about how Social Security and Medicare are going to bankrupt the country and still demand to see every red cent of benefits they can theoretically get…

    The only way out of this is for Gens X and Y to strip them of their right to vote.

  21. “Trouble is, giving people money doesn’t mean they will head to Walmart.”
    Going to Walmart = giving money to Chinese manufacturers. What’s good for Walmart is NOT what’s good for America.

  22. This payment is probably being considered to keep our attention away from the 4% raise for fed employees in 2009 and the 2% raise for feds in 2010.

  23. By this logic we must stop increases for SSI, aid to dependent children, health care and subsidies for illegal aliens, and above all the self regulated increases to members of congress and the federal bureaucracy.
    And don’t forget the non-negotiable increases in insurance and utility rates, or the cost overruns that are so lucrative in public contracts, or the costs of bailouts and subsidies to business.

  24. Anyone who actually believes the government garbage about the lack of inflation is either an idiot, someone who has not bought anything for the last year, or,as I suspect, would use anything he can find to support his generation war rhetoric. I sincerely hope this idiot has to pay into Social Security and Medicare for 45 years then finds out the government still charges him hundreds of $s per month but does not pay for a damned bit of his healthcare, which is the case for those of us forced onto Medicare, today. Also, rather than this B.S. the idiot should actually do a calculation to determine what the average person’s Social Security Payments would be yielding him in retirement if those funds had been invested and compounded at 5%, rather than being used to fund the government, anchor baby illegal alien senior citizens, twenty somethings who injure themselves recreating, rather than working, being drug addicts drawing $600/month from the SSC fund, et al. Jesus! Just shut up!

  25. Steve: I am a senior and I completely agree with you. Everything the current administration is doing is for power and that means buying votes. There ought to be a law. I am also retired as a US Army Officer.

  26. I am giving my $250 to my son and family to help with their Christmas……so is the other grandmother. I think most elderly with children will do the same. n

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  28. Supposedly we do not have inflation but my property taxes have sky rocketed, food prices have jumped, despite a brand new energy efficient heat pump my energy bill is averaging one-third more a month this year than it did last year. My home is over 30 years old. I have a shattered patio door but the price of that door has doubled since last year and the labor to put it in. Now the wood patio it leads to has rotted and has been condemned and it will cost several thousand dollars to replace.

    After retiring, I took care of my ailing father who died shortly after. I spent over a month in Mississippi helping Katrina victims. Throughout my life I have been a volunteer. And that is what I thought I would do in my retirement years. Then I suffered a series of mini strokes and several other medical problems. I am still paying off the the medical costs.

    I have NOT ask for a handout. I have asked for help that I can afford. I am outraged that money the government forcibly took from me is now deemed not to really belong to me. My state thinks I really shouldn’t have my pension. I worked for them for 40 – why should I expect my pension for 40 years? Well, I doubt that I am going to live to be 105! So they will make money off me.

    The government has been redistributing wealth for quite a while. I am not asking for something I did not earn. I never ask them to take it or look after it or invest or anything else. All I am saying is that since they forcibly took it from me and I am all alone, I want my property back. They SAID they were holding it for me.

    Well, I learned long before I retired that Congress had been stealing SS funds and using them for other things and now I am being told how DARE I expect a smaller work force to support me. EXCUSE ME?! WHAT DID THEY DO WITH MY MONEY? WHY DIDN’T THEY INVEST IT WISELY? OR JUST BURY IT IN THE GROUND!

    I am NOT a spoiled brat. I am senior citizen who knows even after a stroke that she has been lied to and stolen from and now that STUPID lie is being bought by the general public.

    And just before the Congress left D.C. they voted themselves a $4,800 / mo COLA ( Cost Of Living Allowance) for 2009.

    Now, would someone explain to me why they should get a cost of living raise in 2009 and at the same time as those on SS, shouldn’t.

    Do you think if you keep repeating the lie, it will become true or that the rest of us will eventually believe it? NOT WHILE I AM ALIVE! NOR THE STUDENTS I TAUGHT TO THINK!

  29. Ron Paul has noted that if the original methodology of CPI had not changed, Social Security checks would be nearly double what they are. This is why I distrust deregulation from “the bottom up”, suppressing things like a minimum wage, all in the name of “defending the free market”, all the while the central bank money spigot is left free to flow. What does a truly free market start with? Honest money, not deregulation and the reduction of the welfare state.
    Those are the last things that ought to go – since government steals money by inflation, and robs the economy of productivity in other ways, it has reduced the people to dependence upon the government check. Why is your first inclination to focus on the apparent injustice of the entitlement, without questioning whether the notoriously duplicitous government accountants had not switched standards to make something appear more than it is?

  30. This is a biggest load of cr*p i have read in recent memory. This would only be true if CPI were an accurate reflection for seniors spending which it is not. The “savings” will be more than chewed up by increases in local taxes brought on by the standard government and school raises in salary. The fact that prices for Disneyworld have dropped is great but is meaningless to this group.
    Mr Chapman clear has no brethe of knowledge on this subject

  31. When you look at a trade agreement like NAFTA, it’s about that thick (holds his hands about?

  32. Brown talked on the back nine about Nike Free 5.5 missing his family. “I’m going to take a couple of days and talk to (wife) Shelly,” Brown said.

  33. My only point is that if you take the Bible straight, as I’m sure many of Reasons readers do, you will see a lot of the Old Testament stuff as absolutely insane. Even some cursory knowledge of Hebrew and doing some mathematics and logic will tell you that you really won’t get the full deal by just doing regular skill english reading for those books. In other words, there’s more to the books of the Bible than most will ever grasp.

  34. My only point is that if you take the Bible straight, as I’m sure many of Reasons readers do, you will see a lot of the Old Testament stuff as absolutely insane. Even some cursory knowledge of Hebrew and doing some mathematics and logic will tell you that you really won’t get the full deal by just doing regular skill english reading for those books. In other words, there’s more to the books of the Bible than most will ever grasp. I’m not concerned that Mr. Crumb will go to hell or anything crazy like that! It’s just that he, like many types of religionists, seems to take it literally, take it straight…the Bible’s books were not written by straight laced divinity students in 3 piece suits who white wash religious beliefs as if God made them with clothes on…the Bible’s books were written by people with very different mindsets

  35. By this logic we must stop increases for SSI, aid to dependent children, health care and subsidies for illegal aliens, and above all the self regulated increases to members of congress and the federal bureaucracy.

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