The Social Security Trust Fund: A Dangerous Illusion?
Not only will the federal budget register a $1.75 trillion dollars deficit in 2009, but the Obama administration is going to add to the public debt another $4.9 trillion over the next years. Furthermore, the recession brings about an even worse entitlement crises. Darren Gersh, Washington, D.C. bureau chief for the Public Broadcasting Service (PBS), finds that early retirements, cost of living adjustments and lower payroll tax receipts will bring an end to Social Security surpluses.
The Congressional Budget Office estimates a Social Security surplus of $16 billion this year and of $3 billion in 2010. Overall, the recession is estimated to shave more than $150 billion from Social Security surpluses over the next three years.
Darren Gersh received some positive information from Barbara Kennelly, president of the National Committee to Preserve Social Security and Medicare. Barbara Kennelly considers there’s nothing to worry about as Social Security has a $2.5 trillion trust fund. Heritage scholars David John and Brian Riedl consider this information to be illusory.
David John and Brian Riedl acknowledged the existence of a Social Security Trust Fund that exists since 1930. The trust fund was created to store money and later pay it to baby boomer retirees. But the scholars pointed that since 1939 Social Security is required by federal law to invest any extra funds in Treasury bonds. This means that the Treasury already spent the money and repaying Social Security will be impossible. And so, the taxpayers will be the ones to fund Social Security with enough cash to cover more than 40 million baby boomer retirees.
As the scholars pointed, the situation is similar to that of a family that constantly takes from its retirement fund and pays for expensive vacations. When the family members begin to retire, they will find only paper IOUs instead of retirement funds.
Free $250 Recovery Stimulus Check for all SS and SSI Recipients
Vice President Joe Biden and Michael J. Astrue, Commissioner of Social Security, announced today that the federal government will send out $250 economic recovery payments to people who receive Social Security and Supplemental Security Income (SSI) benefits beginning in early May 2009 and continuing throughout the month. No action is required to get the payment, which will be sent separately from the person’s regular monthly payment.
“The Social Security Administration and Commissioner Astrue have been working closely with other federal agencies to get these payments out the door in record time and into the hands of folks who need it most,” said Vice President Biden. “These are checks that will make a big difference in the lives of older Americans and people with disabilities – many of whom have been hit especially hard by the economic crisis that has swept across the country.”
“We have been working diligently to issue the $250 one-time recovery payments as soon as possible,” Commissioner Astrue said. “The legislation requires extensive coordination with other federal agencies and I’m pleased we are on track to issue these recovery payments earlier than the statute requires. Soon more than $13 billion will be in the hands of more than 50 million Americans.”
The American Recovery and Reinvestment Act of 2009 provides for a one-time payment of $250 to adult Social Security beneficiaries, and to SSI recipients, except those receiving Medicaid in care facilities. To receive the payment the individual must be eligible for Social Security or SSI during the months of November 2008, December 2008 or January 2009.
The legislation also provides for a one-time payment to Veterans Affairs (VA) and Railroad Retirement Board (RRB) beneficiaries. The VA and RRB will be responsible for paying individuals under their respective programs. However, if someone receives Social Security and SSI, VA or RRB benefits, he or she will receive only one $250 payment. People getting Social Security or SSI should not contact the agency unless a payment is not received by June 4, 2009.
For more detailed information about the $250 one-time economic recovery payments, go to www.socialsecurity.gov/payment.
To learn more about the American Recovery and Reinvestment Act of 2009, go to www.recovery.gov.
Social Security and the Farmer (1955)
Here’s another great SS infomercial from the 1950s.
Narrator: A day different from all other days dawned on the farms and ranches of the United States late in 1954, when Social Security was extended to cover farm operators for the first time, and to cover many more hired farm workers than before. This was an important day for more than five and a half million people who raise the food and fiber to feed and clothe the nation, who bring forth a living for themselves and their families from farm and ranch, from garden and orchard and field, for people like Jim Peterson. Jim’s been farming for 30 nyears, going it alone most of the time. He’s getting older now, and he’s beginning to admit it even to himself.
Jim was required to pay the Social Security self-employment tax along with his income tax beginning with 1955. What does this mean today for Jim Peterson?
What about Charlie Rogers, a farm worker who follows the harvest from state to state? Just as he’s starting a new job, he finds he’s lost his Social Security card. Why is this so important to him?
And how about Frank Johnson? He owns a large farm, employs a good many workers, some are short term people from nearby. But this year, he’s going to need to hire some migrant workers. Frank knows pretty well what to do about his own Social Security, but how can he be sure he’ll have the records he needs for his hired workers, who also are now covered by Social Security?
And what can Mary Clark look forward to? Her husband was killed in a farm accident a few weeks ago. She knows that she and the children can depend on her parents if she needs help. Her mother comes over to take care of the children when Mary goes to town. Mary is determined that neither she nor the children shall be a burden on anyone. What does Social Security mean for her?
We go, as anyone with questions like these should go, to the Social Security District Office for answers. Read more
No Social Security Money For Mexico
Virginia Foxx: “This is Congresswoman Virginia Foxx. You know, part of my job as a member of Congress is to do everything I can to see that unscrupulous people do not take advantage of the citizens of the 5th district. And I work very hard at that along with working on legislation in Washington.
I recently received a letter which really distresses me. It’s a letter from a group called, “Council of Seniors”. It has in it a $1 check, and they ask you to send that check back to them along with $19, so they can help save your Social Security. It’s a long letter with lots of space on it. Blue things written in like they are handwritten like it’s a personal letter.
What they’re telling you is not true. They’re saying that Social Security money is going to Mexico, and that we are giving money to the Mexican government, and particularly to President Felipe Calderon. That is simply not true. No Social Security money is going to Mexico or to any other country.
These groups raise money for themselves. They don’t have the impact on us in Congress that you, an individual constituent, have. All you need to do, if you are concerned about any issue, be it Social Security, notch babies, stimulus packages, whatever is before the Federal government, is to write your representative. Call my office or write me a letter, letters are preferable. Or send me an email and say, “This is how I feel about this issue”, and I will listen to you. I am always happy to hear from you and always happy to know your feelings on different issues.
One of my main jobs is to protect Social Security benefits and other benefits that are due to you, and I want you to know that this is an unscrupulous group, and to implore you not to send money to them. If you get a letter from a group like this that asks you to send them money, don’t do it. And I am going to do my best to make sure that you are not taken advantage of by unscrupulous groups like this one.
Thank you very much.”
The Social Security Death Index
In 1935, President Franklin D. Roosevelt created the Social Security Act as part of his New Deal to stabilize the American economy. Since then, millions of Americans have received post-retirement benefits from the government that has helped them sustain healthy and enjoyable lifestyles for the remainder of their lives.
Unfortunately, fraud became an immediate problem for the system, as many would claim benefits on those who had already passed months ago. To help combat this problem, the Social Security Administration created the Death Master File and the Social Security Death Index (SS Death Index) in 1962. These information databases essentially hold records of every American death from its inception, to ensure only those deserving would receive benefits from the Social Security program.
Due to the Freedom of Information Act, both of these tools are required to be made available to the general public. The only real difference between the two databases is that the Social Security Death Index is provided for free to the public and updated less frequently, while the Death Master file is updated regularly and sold at a regulated price. As such, the Social Security Death Index is the mechanism more frequently used by everyday Americans.
An unforeseen benefit to the creation of these databases was the practical use both serve to genealogy. Tracing family history is something many Americans are interested in as they grow older, and the wide access to death records through the Social Security Death Index and Death Master File is valuable. The information provided by these indices, most commonly birth date, full name, place of last residence, etc., may seem basic, but to genealogists they serve as clues to unraveling the mystery of lineage. It should come as no surprise that many popular websites offering this service link to the Social Security Death Index directly.
Of course, the Social Security Death Index can also be used to cause harm. Occasionally, Americans who are still alive are, for one reason or another, thought to have passed away and marked as such in the Death Index. Unfortunately, once a person is entered into the index, it is extremely difficult to reverse the effects. Not only will the still-alive person cease to receive Social Security checks they still need, they also are susceptible to fraud, as much of their private information, such as their Social Security number, is now listed on the public record.
For the most part, however, the Social Security Death Index has served as a brilliant tool to both supplement the Social Security Program and to assist in the search for familial history. The small flaws in the program are greatly overshadowed by the widespread benefits provided annually.
Obama Stimulus Package Comes With Tax Credits & Free Cash
If you have been left wondering how the Obama Stimulus Package will effect you and your family, you may be surprised to know that it may leave you with a little more money in the bank. Due to two programs, one issued through the IRS, one through Social Security, the American people can expect a greater income in 2009 as tax breaks are given out to the general public.
The first program is the Making Work Pay Tax Credit, which will decrease the amount of taxes withheld from each paycheck over the next several months. This will be claimed on the ‘09 tax returns, so that it will not reflect on the end of year refund. Instead, you can expect between $400 (for a single worker), or $800 (for married couples) more, broken up into about a $30 – $60 increase on each paycheck until the amount is covered.
While it may not seem like much, it is a significant enough raise in income that should allow a number of small boosts to the economy each month, and will help households to have a little bit left over after bills are paid.
The second program is for anyone who is earning Social Security, or getting any kind of railroad or government retirement payments every month. Instead of a small amount more on every check, there will be a one time payout of $250, to be issued in a separate check, as part of the Economic Recovery Payment.
There will also be a majority of people laid off this year who will be eligible for a tax credit when they file in 2009. This can be determined by visiting the IRS website, or by calling your local IRS office.
Worried about this causing tax filing to become more complicated? Anyone earning less then $42,000 a year will also qualify for free tax help, through a number of tax assistance programs within your state.
Ralph Nader on Social Security
Recorded at the University of West Virginia, September 24, 2008.
Student: Earlier you said you want our generation to have a chance to vote on things like Social Security, and I was wondering what you think is wrong with Social Security now and what you plan in doing to change it.
Ralph Nader: Medicare is going out of sight, because it’s required to pay for the enormous, the inflationary costs of hospital and doctor care. It’s been going on for years. That is a problem, but is not Medicare’s problem, Medicare doesn’t write the bills, Medicare pays the bills. It’s the system of waste redundant profiteering – this is a problem. Social Security doesn’t have a problem. Why did they say it has a problem, because they want to put your Social Security money in the stock market and make a lot of money for the brokers.
There is no problem with Social Security. Social Security trustees – these are the trustees of the Social Security system – say that if we do nothing, every dollar is paid out till 2043 and then it starts declining, a bit. I say: “we do nothing”. And that’s based on a 1.7% GDP annual increase. We’ve been over 3% since World War II. If we need more money, we just raise the income level that you have to pay Social Security on. Now, the first $97,000 people earn, they pay Social Security taxes. But, someone who earns a million bucks doesn’t have to pay beyond $97,000. That’s a little wiggle room there, but as long as economic growth continues, Social Security is on a firm footing.
My problem with the Social Security surplus is that Clinton, Bush, and Reagan – all these people used it to pay for daily government expenses. Which means they exchanged the surplus for a Treasury IOU. Now, the Treasury is gone be good for it, because if it isn’t – it’s all over, right? But, they took the surplus and used it for government operating expeditures, which they should never have done, and replaced it with debt, an IOU. That’s where they betrayed. Because it isn’t that they won’t get those IOUs fulfilled, it’s they may have to start printing money. That’s not Social Security’s problem. That’s these political charlatans’ who wanted to keep the deficit a little less every year by pouring the Social Security surplus into government expenditures.
Do I make this clear, what I am saying? How many of you wear seatbelts? When I was your age, I lost a lot of friends in high school and college, in law school, who were killed, because there were no seatbelts. And I got really angry. And I started studying it up and I wrote a third year paper at law school on unsafe automotive design and the law. And because I did that, I turned it into a book that you saw, Unsafe at Any Speed, and I went down to Washington, as a volunteer, and got the motor vehicle and highway safety laws through. I got key reporters reporting, I got hearings, testifying, went up to the House, Senate, got some engineers involved. And now, you all have seatbelts, you have airbags, you have padded dash panels. You don’t split your skull on a 15 mile an hour collision against the cookie cutters of the old cars. You’ve got stronger door latches – someone rams you in the side of the car; it’s much better than it was 40 years ago. You’ve got head restraints, you not gone be speared as easily by a rearward displacing steering column, because is a collapsing steering column.
That’s what I mean by civic freedom. Civic freedom to go up and improve your country. You can’t do that now. Washington is closed down, it’s corporate occupied territory. The corporations have become our government. With tens of thousands of lobbyists, ten thousand political action committees funneling money and their own executives in the exact agencies that are regulating the companies that these executives came from. Like the Forest Service – is run by ex-timber industry guys. So, I gave you this example, because I don’t want you to think that I am some sort of freak of nature. You can do this too. You just want to do it. You got to want do it. When you want to do it, you tell us, expand and you achieve things you never thought you’d achieve – the American Dream. You know what the real American Dream is? Justice, that’s the real American Dream. Thank you very much.
Human Right #22: Social Security
What is social security?
And why is it so confusing?
Here’s the simple version:
Social security is what supports you when you can’t support yourself.
When you get hurt
when you get sick
when you get old
you have the right to be supported.
It can be money… or medicine… or whatever you need…
to get back on your own two feet.
Because sometimes
we all need a little help.
Human Right #22: Social Security
Social Security Email Fraud Warning
An e-mail scam has been spreading around with a message that says the Social Security Administration’s records have been tampered with. The content of the e-mail warns the reader that if they don’t click on a specific link and give out undisclosed information, their Medicare or Social Security benefits, will lapse. The SS Administration assures us that this message is certainly not from them.
As a precautionary measure Social Security advises all those with Social Security accounts to be careful when giving out confidential data. An even better way of preventing being conned is to never impart your private information and facts either over the telephone or through the internet. However, if you were the one who initiated the call to a verified phone number, and your personal numbers are asked for verification, then it’s okay to do so.
The SSA’s Office of Inspector General is looking into the accounts of these commotions. You can call their hotline at 1-800-269-0271 to convey doubtful transactions. (If you are deaf or hard of hearing, call the OIG TTY number at 1-866-501-2101.)
Online complaints may be reported by filling out a form at http://www.socialsecurity.gov/oig/
If you suspect a fraudulent SSA agent, make sure to report it to Social Security’s toll-free number at 1-800-772-1213 to be able to confirm the legitimacy of the caller. (If you are deaf or hard of hearing, you may call Social Security’s TTY number at 1-800-325-0778.)
Focus On Strengthening Social Security, Not Cutting It
The National Committee to Preserve Social Security and Medicare recently held an event on “Commissions, Cuts and Crisis Calls”. Over the next few days we will post recordings of some of the exciting and informative speeches that took place at the event.
BARBARA B. KENNELLY: Good morning. Thank you all for coming out here this morning as we invited you to, and I want to take a few minutes to outline why we have asked you to come here this morning before I introduce our valued guests. I want to tell you a little about this organization. I’m Barbara Kennelly; I’m president of National Committee to Preserve Social Security and Medicare. We have 3 million members and supporters across these United States. Our members have various political backgrounds, but they have one passion and that is to preserve Social Security and Medicare, and not just for themselves but for their children and for their grandchildren.
I have to tell you that Social Security and Medicare have always generated controversy. They were under attack before the enacting legislation even passed in the House and the Senate. And you know, the opponents of Social Security they’ve changed their tactics, they’ve changed their retric, but they have never changed their convictions. They think that Social Security and Medicare are unwarranted expansions of government and they should not survive in their current form.
And I have to tell you this morning, the national committee and the people who are on this panel, and I think some of the people in this room, absolutely believe we must preserve Social Security. Before the Great Depression, people worked; they hoped they could save a little money, but when they stopped working the lucky ones they could go live with the younger members of their family. The ones that weren’t so lucky, they often lived in poverty. And what we hear about today, after the Great Depression, all those savings that people who even had savings they didn’t have it anymore, and this cannot happen today because we have Social Security. Read more
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