Social Security Stimulus Checks & the Future of Social Security
News Anchor: Government spending of a different kind, the kind that many in America are probably happy to see. Today recipients of Social Security will begin to see a little more in their mail boxes or in their bank accounts if it’s an electronic transfer. It is the day that the SSA begins mailing out the first of over 52 million Economic Recovery Act payments. Joining us on a Fox Business exclusive is Michael Astrue. He is the commissioner of the Social Security Administration, Michael welcome.
Michael Astrue: Thank you.
News Anchor: 250 bucks?
Michael Astrue: 250 bucks.
News Anchor: To everybody on Social Security?
Michael Astrue: 52 million Americans.
News Anchor: One-time payment or every month?
Michael Astrue: One-time payment.
News Anchor: Okay, now I guess you guys have done a survey on what people may spend. What are they doing to do?
Michael Astrue: Well, survey would be too scientific, but we’ve had 4,100 Americans go on our website and explain what they were going to do with the check. And it goes from the very mundane like, “I’m going to buy tires, I’m going to buy furniture” to very moving story by a woman who is dying of lung cancer buying things for her children. Most of them indicated they’re going to spend it. Only about 2% said they were going to save it, 98% so far said they were going to be spending it.
News Anchor: So it will go back into the economy?
Michael Astrue: Right, it fits with what Congress was trying to achieve in having it go right back in the economy.
News Anchor: The money is coming from the stimulus plan?
Michael Astrue: It’s coming from the stimulus plan. And the important thing for people to remember is that about half the money is going out today. If you have direct deposit you will get it today. If you’re not in that half, paper checks take a little longer. Money will be going out over the next 3 weeks. So if you don’t have it today, don’t panic. Wait until June 1st, June 4th and then call us if there is a problem. But we’ve done this before, usually we’re pretty good about getting the checks the right place.
News Anchor: I know $250 to a lot of people might seem to be a lot of money, but as a whole, you wonder if the economic impact is going to be great enough to justify the long term cost.
Michael Astrue: Right. I think what they’re trying to do now is to get money quickly into the economy. And you look at an average sized state, you’re getting a quarter billion dollars all of a sudden into the local economy. And the economic thinking is that we need to do at least as much as we’ve done to try to give a little bit of the stimulus… get local economies back faster than they would otherwise do. So the thinking is that it’s not really a long term investment, it’s to get people spending, it’s to get some of those businesses and the people on the margin spending and staying on their feet.
News Anchor: I’m 37.
Michael Astrue: You’re a lot younger than I am.
News Anchor: Is Social Security going to be available for me?
Micheal: Absolutely.
News Anchor: Can you please tell it’s going to be available, because every month I’m putting money into it.
Michael Astrue: No, it’s going to be there. We need…
News Anchor: But I got to tell you, to be honest with you, I’m planning like it won’t be around. I hope it’s there, but as I create as my own family financial plan, I assume it will not be there.
Michael Astrue: I don’t want to be too critical of that because as a nation we went to a negative savings rate briefly right before this recession hit and hopefully this will be a learning moment for the country, and as the economy gets better we will remember that we brought some of this on ourselves by getting away from some of our traditional values of thrift and savings.
But, the trustees’ report is next week, the funds as of last year were fully solvent through 2041. And even after that date if Congress did nothing, people would be getting 78% of their benefits. That’s not perfect, but I think as the President has said and I think as the senator said yesterday in the Washington Post, it’s a math problem. It’s pretty obvious what needs to be done. We have relatively limited number of choices, some political pain. I think it’s going to get done if not next year, within the next couple of years.
News Anchor: Do you foresee a possibility that the age… we’re living longer. The average age of an Americans female is now about 81. Men are living about 3 years less, unfortunately, that we might have to raise that age cap a little bit.
Michael Astrue: It’s one of the topics that’s entered discussion.
News Anchor: We have already.
Michael Astrue: At some point there are only two ways to do it: you increase revenues or you decrease benefits in some way. The last time Congress did this they did raise the normal retirement age. That’s already being debated and discussed. But I don’t think anything is set yet, it is not clear what Congress will do when Congress really starts focus on that.
News Anchor: It’s an interesting process done by people much smarter at math than I am. Okay, we got to go to the President. We’re going to leave it there Michael Astrue, commissioner of the Social Security Administration, welcome you back anytime.
Michael Astrue: I’d love to come back any day.
Comments
Leave a Reply
Settle Tax Debt Fast!
Get Foreclosure Help
