Campaigns/Elections

The New York Times Corrects Rick Perry's Misconceptions About the Social Security Trust Fund

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As Shikha Dalmia and Peter Suderman noted yesterday, Rick Perry stood by his description of Social Security as "a Ponzi scheme" during last night's Republican debate. This despite New York Times reporter Michael Shear's recent efforts to set Perry straight:

Touching a potential political minefield, Mr. Perry unleashes a critique against Social Security as "a crumbling monument to the failure of the New Deal" [in his book Fed Up!].

Mr. Perry's assault on the retirement program is not a throwaway line or two. He asserts that the social programs of the New Deal—including Social Security—"never died, and like a bad disease, they have spread." He says the Social Security trust fund is an "elaborate illusion cooked up by government magicians."

Asked about the book recently, Mr. Perry went even further, calling Social Security a "Ponzi scheme for these young people" and a "monstrous lie on this generation."

But his words skim over the financial reality of Social Security. Economists of all stripes agree that the program, while stressed, would exhaust the money in the trust fund by 2037. But even then, taxes would pay for close to 80 percent of the benefits currently promised.

According to Shear, then, Social Security's "financial reality" includes a "trust fund" that "economists of all stripes agree" won't run out of money for another quarter century or so. But as the Times itself occasionally concedes, the trust fund is no more than "an accounting device" that represents how much the government owes itself—or, in other words, how much must be extracted from taxpayers to cover all the surplus Social Security money Congress has squandered over the years. The surpluses themselves are long gone, replaced by Treasury bonds that can be redeemed only through higher taxes or further borrowing (which eventually translates into higher taxes). So the "reality" that Shear is asserting as a matter of verifiable fact in a news story is actually the "elaborate illusion" to which Perry is calling attention. The year of reckoning is not 2037, when the notional trust fund is expected to reach zero, but 2010, when Social Security's benefits began to exceed its annual revenues, meaning that the program has to be subsidized by other sources of money, which contributes to the national debt instead of making it seem smaller.

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  1. Al Sharpton had a succinct way of addressing the GOP attempt at a political save for themselves by exempting people above a certain age from their plan to gut the social safety net:

    “He just told them Bernie Madoff is who gave them their Social Security!”

    1. It’s nice to see that Al Sharpton is as unintelligible quoted as he is live.

    2. “He just told them Bernie Madoff is who gave them their Social Security!”

      I’ve got to admit, this is a much better line than “Kill the Jew.” Al has come a long way.

  2. If Perry is good for anything, he’s good for making liberal’s brains explode.

    1. and apparently republicans judging by gop reactions

      1. i got no brain to asplode derp

  3. Right, Social Security is now on the red, but it’s drawing on its phantom trust fund for a while yet. Of course, since that money was already spent, well, uh… pay no attention to the man behind the curtain!

  4. It’s like I tell my dad – there is no trust fund. Congress already spent your money.

    1. I tell my mother the same thing (also about Medicare) … then I whisper “Soylent Green”.

  5. the SSTF is NOT criminal fraud like a madoff ponzi scheme. and the teabaggers support SS & medicare so the gop is divided against itself.

    1. “the SSTF is NOT criminal fraud like a madoff ponzi scheme.”
      Yes, it is different. It’s worse.

      1. We will never be free until there is double the number of starving old people in this country!

        1. Because of course the only possible result of SS reform would be starving retirees.

          I miss the real Tony.

          1. Must be true. I’ve read some Civil War history – which was like 75 years before SS – and there are umpteen references to the common practice of taking everyone over 65 down to the nearest cliff or river and tossing them in. Go through any graveyard and you’ll not see one person who lived past 65 before SS.

        2. You mean the old people who, for decades, have neglected to fix it?

          1. It’s not broken.

            Republicans are broken.

            1. But then, I am a Team Blue cheerleader… and I never see or hear anything bad coming from my Team.

        3. herpity derp derp

    2. Every time Bernie Madoff spent the money his investors gave him, he wrote “I owe Joe Blow $X” on a piece of paper and put it in his wall safe. The funds in that safe will not be exhausted until 2037.

      1. Well said.

      2. Madoff’s problem was that he couldn’t “tax” his way out of trouble.

  6. elaborate illusion cooked up by government magicians

    “Illusion, Michael Shear. A trick is something a whore does for money.”

    1. So it’s not an illusion after all, it’s a trick performed by past Congresses for votes.

      1. “Not tricks, Joshua, illusions. A trick is something a whore does for money…or votes!”

          1. I’ve made a huge mistake.

        1. so wait, are Congress whores or aren’t they?

          1. No, Joshua. A whore receives the fucking. Congress, on the other hand…

    2. Or cocaine. (Extended pilot.)

    3. I [bleeped] the business model Michael.

      Narrator: Actually they just made out.

      Yeah she had all kinds of orgasms.

  7. “But even then, taxes would pay for close to 80 percent of the benefits currently promised.”

    Do you know what would happen if a major life insurance company sold a bunch of polices–and later said that it would pay close to 80 percent of the benefits currently promised?

    The government would almost certainly step in and bail out the difference–and most everyone in upper management would do the perp walk and be indicted for fraud!

    But this is presented by Michael Shear like it’s a good thing? If he’s gonna put a pig in a dress like that and tell me it’s Miss America, at least he could have put her in a decent dress!

    Michael Sear just insulted the intelligence of everyone who subscribes to the New York Times.

    1. Michael Sear just insulted the intelligence of everyone who subscribes to the New York Times.

      Thankfully, a shrinking demographic!

    2. no he didn’t, he knows they’re just as stupid as he is

      The NYT sucks anyway. Barely-veiled op-ed pieces pretending to be actual articles. And the selection of what to cover is also highly liberal skewed.
      I read the New Jersey Record (or I think it’s techniaclly called the Bergen Record). It actually covers, you know, the news, you know, actual events (instead of half the articles being about “trends”; again, NYT is actually op-ed). Plus they cover my NJ local news.

      Most news is fucking retarded in general. Nobody who follows the masintream media knows what the fuck is going on in the world. Schmoozing wikipedia I’ve found there have been like 5 major coups all over the world that I had never fucking heard about. Entire countries are reforming and you don’t hear a blip on the normal news.

      Anybody who watches the mainstream news would not be able to answer you this simple question: What is currently the youngest, most recent formed country? What kind of country is it? And what are the next-youngest?

      1. South Sudan and East Timor, right?

        1. south sudan and montenegro, then east timor.

      2. Since not knowing some of that stuff makes me stupid, what does not giving a shit make me?

        1. I mean don’t you know anything about Sri Lanka? About how the Sikhs are killing like tons of Israelis there?

    3. Assuming their intelligence CAN be insulted. They are NYT subscribers, after all…

    4. “Do you know what would happen if a major life insurance company sold a bunch of polices–and later said that it would pay close to 80 percent of the benefits currently promised?”

      Could a life insurance company claim to be solvent if it had no money, but hoped that the feds would step in and pay 80% of benefits it owed?

  8. I’ve said it before and I;ll say it again

    Liberals fucking suck at math and more generally real, fact-based business-like decisions/policies.

    They claim everybody else doesn’t want a safety net for seniors, that we don’t want people to have these benefits. Well, we all want them, just as much as I’d love to date Beyonce Knowles and gold to rain from the sky. But that shit ain’t gonna happen. And the basic fact of social security and a good chunk of our federal government, is not sustainable. Even IF you raise taxes a LOT, They’re STILL not sustainable. Doubly so if you consider that if they actually did raise taxes, they’d just spend more.

    1. Pretty sure the choice isn’t between status quo and total collapse of the welfare state.

      1. pretty sure the choice isn’t between status quo and killing granny.

        1. Nope, those are the only choices.

  9. I’ve paid a lot of my paychecks into SS, and I want every penny back. I’m only 72 now, but when I’m 92 I do not want to be eating catfood from a can, and living in the backseat of my Corolla. The fact that Perry wants me to live in filth and degradation for my remaining years makes me angry. And I vote, too! Me and others like me will make sure we elect only candidates who look out for our interests. To younger people who never had to live through depression, WWII, Korea War and other hard times, my advice is to toughen up. Instead of complaining about SS, go out and get a job! When you retire, you’ll be glad you paid into SS like me. And a final remark to the thread upstart Joshua… your Dad should spank you! How dare you talk back to your elders. We have more experience and wisdom than you, and you should just shut up (for a change) and listen to us.

    1. HAHAHAHAHAHAHAHAHAHAHA

    2. Soylent Green

      1. Wrong 70s distopia. Carousel.

        1. My thoughts exactly. I like regular food and will be able to afford it after Carousel.

          1. I’d agree with you, but I think I’m going to be on Carousel, being over 30.

            1. What color is your palm crystal?

              1. Clear. Is that bad?

                1. Yeah, that means you’re outside the dome city. No more orgies and pink smoke drug for you.

                2. Dunno, can’t see it through all of this hair.

        2. RENEW!

    3. “When you retire, you’ll be glad you paid into SS like me.”

      That’s the baloney part.

      People who start collecting right now will get what they paid in, but people joining the workforce right now? Will never get their money back.

      Social Security will never pay them more than they’re paying in. They’d do much better keeping that money themselves. …or using it to take care of their own parents!

      For the thousandth time, the reason Social Security is mandatory–isn’t because, given the choice, people would pay in of their own free will because it’s such a great deal.

      People under 30 will never get the money back they paid in.

      Never.

      1. touche
        well said

      2. “People who start collecting right now will get what they paid in”

        Really? I thought there have been studies that show a person paying in for the last 45 years would have been so much better off if the money (both empoyer and employee contributions)had been invested regularly in an index stock market fund. Even better, one could leave the residual to one’s heirs.

        1. Oh, I’m not saying they wouldn’t have done better for themselves if they’d been able to keep their own money…

          Even if they’d used it to pay down their mortgage or put their kids through college…

          I’m saying that in strict dollar terms, even adjusted for inflation, they’re not getting back what they paid in. Older people who started paying earlier into the program? They did okay.

          My grandmother lived to be 94. She died more than ten years ago. Somebody like that who started paying into the system back when it started? …and then lived to 94?

          She got back more than she put in.

          She would have done even better if she’d been able to keep more of her money–no doubt! But she at least got her money back and then some…

          That isn’t about to happen for people under 30 today. Unless the we hit the singularity soon or the transhumanists invent an immortality pill tomorrow? The chances of the average person under 30 getting back what they’re payin’ in–adjusted for inflation?

          Is zero.

          That’s the way pyramid/ponzi scams work–the people who get in first actually make money! It’s the people who get in last that end up holding the bag.

      3. Which is why I almost want to vote for Rick Perry. I mean, the guy is a lying a-hole but at least he’s willing to tell the truth about SS on live TV. Just for that, I kinda like him.

        1. Just for the record, George W. Bush said the same kinds of things when he was running against Gore.

          It’s hard to remember now, but the reason to vote for George W. Bush was because he had some great ideas about reforming Social Security, and he wanted to essentially privatize the welfare state…

          Presidential candidates are like a box of chocolates–what we want rarely has anything to do with what we get.

          If we’re gonna play the percentages, the smart money would have Perry denouncing Social Security as a ponzi scam until he becomes the undisputed frontrunner for the nomination. And then once he gets the nomination, he starts downplaying what he used to say going into the general election. And then if he wins? He completely forgets everything he ever said about screwing with Social Security.

          Right now he’s focused on winning the nomination. What it takes to win the nomination, what it takes to win the general election, and what it takes to win re-election? Are three completely different things.

          That’s why Obama ran for the nomination on closing Guantanamo, started downplaying Guantanamo when he won the nomination, and completely forgot about Guantanamo once he was elected…

          Guantanamo who?! Oh yeah! I know that song–they always sing it in Mexican restaurants:

          Guantanamera
          Guajira Guantanamera
          Guantan-a-mera!
          Guajira Guantanamera

          It’s all the same thing. If Perry is elected, and he ends up reforming Social Security–it’ll just be a coincidence. The only president we’ve had recently that was stupid enough to do what he thought was in the best interest of the country even though it was unpopular?

          Was Barack Obama when he pushed through ObamaCare. If they’re too stupid to do something so fundamentally unpopular and get themselves thrown out on their asses, then they’re too stupid to be president.

          Social Security reform happens from the bottom up–not the top down. When an overwhelming majority of Americans no longer want Social Security, it won’t matter who the president is–he or she will get rid of it.

    4. It is very simple: do nothing and there will be no Social Security in a decade or two. What is scary is that does not bother very many seasoned citizens or Democrats.

      1. Mmmm…seasoned citizens are delicious

    5. Canned catfood? Good luck being able to afford that.

    6. I think it sounds like someone has fallen… and they can’t get up.

    7. They should have put you in a glass jar on a mantlepiece. That social security trust fund has been had. Nothing you can do about it. It’s gone. It’s had. You lose.

      Listen, if you have a milkshake, and I have a straw, and it reaches aaaaalllllll the way over to your social security money that you paid in….I….drink….your…..milkshake!I drink it up!

    8. Instead of complaining about SS, go out and get a job otherwise there’s no way to fund my SS checks!

    9. You misspoke – should have said “I want every penny back, and some of yours too!”

      If you live to be 92, you’ll get back far more than you payed in.

      Dad probably would try to spank me. If he wanted to go into a “home”.

      1. So — what if you croak before your Social “Security” eligibility kicks in?

        http://www.secureourfuture.org/faqs.php#what if i die

        If you have a spouse or a child under 18 when you die, they can collect some of your Social Security benefits as survivor benefits. If you are unmarried or your child is over 18 when you die the government keeps your money. Because you have no property rights to your Social Security taxes or benefits, your children cannot inherit your money and the government keeps it all.

        Excuse me, but isn’t that outright fraud/theft?

        1. No shit. Unless they had that in the SS contract they conned us into signing.

        2. Yeah, but it’s only theft because it’s a tax, and it’s only fraud because they’re happy to let people believe that it’s not a tax but some kind of retirement fund.

        3. that happened to my mother-in-law. died at 55. her life insurance and “risky” 401k helped buy us a house and put my sister-in-law through graduate school. Social Security paid squat.

          1. the PD i worked for before my current one did not have us pay into social security. it was awesome.

    10. Gray Panther wrote:

      Me and others like me…

      –thereby revealing him/herself to be under 30 … OK, under 40. Or possibly s/he is the only septuagenarian I’ve encountered who exhibits the currently trendy reversal, in the presence of a conjunction, of objective and subjective noun cases.

      1. Grey Panther — not the other spelling that I wrote; and pronoun rather than noun.

    11. Instead of complaining about SS, go out and get a job!

      The only people paying into social security are the ones who, you know, have a job.

      1. All day long I hear reasons why people can’t work. My legs hurt, my back hurts, I’m only four!

    12. You, sir, have been neglecting to fix the problem much longer than the rest of us, so just shut up and sleep in the bed you’ve made for yourself.

    13. Fuck you. I had to get a soc sec number in order to enroll my daughter in fucking kindergarten. She is now bound by a contract she was too young to sign, and can’t get out of. We declared she is a US citizen, and is now under their “exclusive jurisdiction”, meaning her inalienable rights are gone. Fuck you again.

    14. at some point, you’ve lived long enough

    15. We have more experience and wisdom than you, and you should just shut up (for a change) and listen to us.

      Oh, FOAD already. This, coming from the demographic that can’t fucking figure out how to run a cell phone or set the clock on a microwave.

      Do you know how to avoid eating cat food in your dotage? Here’s the big secret: SAVE SOME OF YOUR MONEY when you’re still working.

    16. “I’ve paid a lot of my paychecks into SS, and I want every penny back.”

      Fine, then will stop paying you anything at all after that point.

      The fact is that there are a whole lot of people getting back a lot more than they ever paid into it.

      Lots of old folks conviently forget that the FICA tax rates they were paying into SS were a lot lower for most of their working lives than they are now.

      They also forget that the benfits are “progressively” engineered to give those lower on the income scale a bigger payout relative to what they paid in than higher income people get.

  10. Michael Sear just insulted the intelligence of everyone who subscribes to the New York Times.

    So really, he hasn’t insulted much of anything.

  11. “But even then, taxes would pay for close to 80 percent of the benefits currently promised.”

    And who pays these taxes, unicorns? So it’s not a Ponzi scheme, it’s just robbbing Peter to pay Paul with money borrowed from Mary.

  12. It is a Ponzi scheme in terms of how it fuels its funding, only its sort of crappier. It’s based entirely on birth rates. At least with a Ponzi scheme, you can theoretically come out of it if you’re smart and your investors don’t ask for cash withdrawals for a while.

    1. You can also ‘win’ if you don’t play. Try that with S/S.

      1. well, that’s not exactly true, the point of a Ponzi scheme is you’re defrauded – the guy says he’s investing your money but he’s actually not

        1. I understand.
          My point is that S/S is the only Ponzi scheme you are forced to play at the point of a gun.

          1. Nobody’s forcing you to take a paycheck.

            Pissy entitled moron.

            1. True, he could just take welfare and food stamps like you and your friends…

            2. Funny that I, as a good liberal, would use the term “entitled” like that… I’m having an off day.

      2. Nobody’s forcing you to accept payouts.

        1. Trolling or stupid as fuck?

      3. my old PD was exempt. many are

  13. But even then, taxes would pay for close to 80 100 percent of the benefits currently promised.

  14. What if everybody who’s ever been involved with SS in the government spontaneously combusts? Would it be an incentive for people not to expand SS?

  15. SS is clearly not a Ponzi scheme. Who would be taken in by a Ponzi scheme that offered you such a lousy rate of return as SS does?

    1. that made me LOL

  16. ATTENTION OLD PEOPLE!

    For your entire lives you have paid into Social Security. Politicians told you that witholding was like a forced savings account. They said they were socking it away on your behalf so that it would be there when you needed it.

    Instead they spent all that money on roads and schools and wars and other random crap you don’t even remember. The money was already used to buy stuff for you. It’s gone, buried in the dirt of a hundred different countries, primarily our own.

    Since the money you paid into the system has already been spent, the only way the government can fulfill its promise of providing for your retirement is to tax the people who are still working or will be working in the future. When you state that you paid into the system and then demand what you are “owed” you are actually demanding that current politicians steal from your children. If you have a problem with this, too bad. You should have spoken up decades ago.

    Personally, I’m going to fight hard to keep you from taking what I earned.

  17. hey Grey Panther, while you were putting money into SS prior to 1965, you could have been buying silver dimes with that money and then today you could afford all the $4.00 a gallon gasoline you would ever need.

  18. Something that doesn’t reach crisis level for 25 years is obviously something that needs to be addressed right now. Better when a Dem president can be forced to take credit, since past attempts to privatize SS (the goal here) have cost GOP politicians double digit favorability losses.

    1. Yeah, better to wait until it’s beyond salvaging. I’d like to see it collapse too.

      1. Then again, we have to do something about global warming right now, even though we won’t see certain death for decades…

  19. Every time Bernie Madoff spent the money his investors gave him, he wrote “I owe Joe Blow $X” on a piece of paper and put it in his wall safe. The funds in that safe will not be exhausted until 2037. So Madoff’s investors can just be paid out of that safe, there won’t be a crisis for 25 years.

    Sorry to repeat myself but SSA has no assets and never has. The “trust fund” is Bernie Madoff’s safe–he can pay it back only if new suckers keep paying in.

    1. Too bad the government doesn’t need suckers, just a gun.

  20. i’m surprised more SS opponents don’t use a “liberal’s argument” against it

    it’s RACIST.

    black males, actually disproportionately get the worst deal out of it. that’s because, compared to most other demographics, they pay a substantially higher %age of their income into it, AND get less out (since they don’t live as long).

    an argument a liberal could approve of:IT’S RACIST!!!

  21. People who are financially set should not be allowed to collect on top of their work pensions and 401k’s up to a certain amount. I will never be able to collect SS because I’m 37 and its almost gone already.. Or it is gone. We are screwed as a country.

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