Burnt Orange Report

Jim:

One of the great things about blogs, at least in theory, is that people can be intellectually honest and have debates that never take place in the political arena.

If Democrats don't trust Bush to reform Social Security I can understand that. If Democrats think Republicans are out to destroy the New Deal I can understand that even if I think it is hyperbole. If Democrats oppose personal accounts in Social Security I can even understand that. But, can you please explain to me why anybody thinks the current system is something that should be continued? Because I really don't understand that.

THERE IS A POINT
I don't believe Bush is so naive as to believe that Delay is going to motivate the populus to accept this plan, I believe he's getting him on board with a healthy dose of ego booster in order to depend on him to keep the republican congress in line. He's lubing up the hammer to make sure he's willing to pound down any nere-do-well congressmen who consider blocking the vote.

At the risk of abusive burden-shifting, why should the current system not be continued; or perhaps more accurately, why should reform on the level contemplated be undertaken?

The current system's benefit structure is overly complicated and too bureaucratic. That said, minor changes can be made to resolve this. Moreover, minor changes can be made to ensure the system's solvency (which isn't really a problem anyways, since benefits are backed up by government credit).

The current system, despite its flaws, has been highly effective at guaranteeing a basic standard of living for the retired without subjecting people to economic disaster.

Social Security works pretty well. That's why it's one of the most popular government programs in our nation's history.

The burden of showing the current system shouldn't be continued, therefore, ought to fall on those arguing against its continuation.

Minor changes cannot be made to resolve this, unless by "minor" you mean a major tax hike or benefit cut. The argument against the current system is simple, it is a pay as you go system which is about to be turned upside down as income to the system is outpaced by money paid out. Combined with a low benefit, lack of ownership by the individual, and an population that is living longer you have problems.

Solvency isn't a problem? The "trust fund" is funded by what? Payroll taxes. Those are lent to the general fund in return for bonds. So the trust fund, in reality, consists of bonds and an accounting gimmick that sets a rate of return on the bonds. The government still has to pay the money on the bonds and appropriate money for the rate it set. That money has to come from somewhere so saying that it is backed by govenment credit does not in anyway mean that solvency is not a problem, it just means that government will have to spend more money to fund it....presumably from a tax hike or out of the current budget.

Personal accounts are not a cure all, the hole is too big. Repeal the current tax cuts? Sure, but that is money coming from outside the SS system to supplement which means the structural problem exists. I understand that this is a political issue, but like I said it would be nice if we who are not politicians could at least have an intellectually honest debate about SS.