Ten Myths about Social Security

[REACTIVATED IN CT]

Opinion: Ten Myths about Social Security
Excerpt: "The current debate over privatizing Social Security has been marred by numerous myths perpetuated by both privatization's advocates and the media. The Century Foundation looks at 10 commonly accepted assertions and points out why each has little to do with reality." (The Century Foundation)

http://www.socsec.org/publications.asp?pubid=507

[RobertSeattle]

1. Myth 11 - This was a major part of Bush's 2004 Campaign Plank

Ergo a "mandate" - total BS.

Perhaps we need a Social Security Vets for Truth...

[Colorado Blue]

2. Oh - there's got to be SOMETHING impeachable -

in here SOMEWHERE - right? Please?

[papau]

3. Excellent info and links - I like the restrictions on the priv acct estate

http://www.socsec.org/publications.asp?pubid=326
Excellent discussions!

Myth #1: Social Security is in crisis and facing bankruptcy.

Myth #2: Social Security is unsustainable.

Myth #3: Social Security's trust funds are filled with worthless IOUs.

Myth #4: The real date to worry about is 2018.

Myth #5: Social Security is a bad deal.

Myth #6: Social Security is overly generous.


Myth #7: "Privatization" will strengthen Social Security.


Myth #8: Today's young workers will benefit the most under privatization.

Myth #9: Privatization will enable retirees to leave the assets in their accounts to their heirs.

Although this claim continues to be made widely, most workers would not be able to bequeath their Social Security investment accounts upon their death. The proposals put forward by the president's commission would allow retirees to collect some or all of their lump sums, provided that both spouses agree and that the withdrawals are of sufficient size to keep the worker and spouse out of poverty. (Turning over the entire "nest egg" to retirees would run the risk that individuals would squander it, either leaving them impoverished or the government on the hook for providing subsistence benefits.) The commission did not provide details about how the government would determine whether retirees would be at risk of poverty, but given that nearly half of today's retirees would be in poverty without Social Security, it's safe to say that a large portion of future workers would not be allowed to access their accounts in the form of a lump sum. To a large extent, it would be only the wealthiest elderly—those who already have sufficient assets to pass along to their heirs—who would gain access to their investment accounts.


Myth #10: Reforms that retain Social Security's existing protections will not work.

Social Security's projected shortfall beginning after the year 2042 could be surmounted by choosing from a menu of modest benefit cuts and revenue increases, without increasing federal deficits. Among the alternatives that would help strengthen the system: including all state and local workers in the program (most of whom are now exempted) to increase revenues; including earlier, lower-salary years of workers in calculating their retirement benefits; changing the benefit formula so that workers with high income have a smaller share of their pre-retirement earnings replaced by Social Security; raising the cap on earnings subject to the payroll tax; modestly reducing early retirement benefits; and so on. Any combination of such changes would strengthen the system's long-term finances while preserving the features that have made it so successful.

http://www.ssa.gov/OACT/TR/TR04/tr04.pdf.
http://www.cbo.gov/ftpdocs/55xx/doc5530/06-14-SocialSecurity.pdf.
http://www.cbpp.org/3-23-04socsec.htm.

http://www.cbpp.org/1-4-05socsec.htm.
http://www.ssa.gov/OACT/TR/TR04/tr04.pdf.

http://www.cbpp.org/1-11-05socsec.htm.

http://www.ssa.gov/OACT/NOTES/note144.html.

http://finance.senate.gov/press/pr100302.pdf.

http://gsbwww.uchicago.edu/fac/austan.goolsbee/research/ssecfees.pdf.

Social Security Reform: The Basics, The Century Foundation, 2005 (forthcoming)

http://www.tcf.org/Publications/RetirementSecurity/12badideas.pdf.

http://www.socsec.org/commentary.asp?opedid=846.


http://www.socsec.org/publications.asp?pubid=326.