Welcome to Wall Street Journal’s Social Security Dream World
It’s never a surpise to see yet another Wall Street Journal opinion writer extolling the values of privatization, vouchers and the demonization of the average American. However, this opinion piece written by former member of the Reagan administration was particularly ridiculous. In a nutshell, he claims that American seniors will become millionaires thanks to Social Security and Medicare. No, really—that’s what he said.
Readers may recall the 1950s TV show, “The Millionaire,” which portrayed stories of individuals who were given a “no strings attached” gift of money by an anonymous benefactor. Each week in one of the show’s opening scenes, a man representing the wealthy benefactor, John Beresford Tipton Jr., knocked on an unsuspecting recipient’s door and announced: “My name is Michael Anthony and I have a cashier’s check for you for one million dollars.”That TV program is scheduled to return next year as a reality show, and the new recipients will be the typical husband and wife who reach age 66 and qualify for Social Security. Starting next year, this typical couple, receiving the average benefit, will begin collecting a combination of cash and health-care entitlement benefits that will total $1 million over their remaining expected lifetime.
Alternet provides an easy to understand description of why this analysis is flat-out wrong:
All of this, Cogan says, is according to his own calculations based on government data. It’s all wrong, however, and while it’s often difficult to say with any certainty whether someone is intentionally lying to people or simply making an honest error, in this case it’s clear.Cogan’s sleight of hand is simple: when he gives the amount this average couple paid into the two programs, he adjusts for inflation to current dollars. On the benefits side, he doesn’t ? he uses future dollars, which results in a larger number. John Cogan is a professor of public policy at Stanford University; every one of his students knows that he or she would get an F comparing inflation adjusted numbers on one side of the ledger to nominal dollars on the other ? it’s apples and oranges and it’s about as mendacious as one can get.
Our Executive VP and Acting CEO, Max Richtman, also challenges the clearly political inter-generational warfare angle of this piece in his letter to Wall Street Journal editors. Since there’s not a chance his letter will ever see print, we offer it to you here:
Dear Editor:Maybe John Cogan?s neighborhood is full of ?Millionaire Retirees? (The Millionaire Retirees Next Door, May 12th) but out here in the real world, one out of three seniors in the United States is economically insecure and living under twice the federal poverty line, at $22,000 per person. Contrary to Cogan?s ?greedy geezer? mythology, the average annual Social Security check is a modest $14,000 and it doesn?t come from an ?anonymous benefactor?.While portraying Social Security and Medicare beneficiaries as millionaires fits the absurd rhetoric so popular in conservative circles these days, it conveniently ignores the reality that working Americans of all ages and political parties understand: the government doesn?t fund Social Security, workers and their employers do. Social Security keeps millions of families from poverty each year while Medicare provides life saving health coverage for a population which private insurers won?t serve without massive government subsidies. No one is getting rich on Social Security and Medicare, although clearly Wall Street and private insurance companies would like to do exactly that, while also passing the bill along to middle-class America.Max RichtmanExecutive Vice President/Acting CEONational Committee to Preserve Social Security and Medicare10 G Street, NE, Suite 600Washington, DC 20003(202) 216-8378
Alan Simpson’s Confused about Social Security – Still
Kudos to Huffington Post for daring to use facts and figures when talking about Social Security. It?s certainly a novelty in media coverage these days, and an approach that clearly disturbs those who?d rather not let the facts get in the way of their lifelong campaign against Social Security.
Alan Simpson Attacks AARP, Says Social Security Is ‘Not A Retirement Program’ (VIDEO)
WASHINGTON — Alan Simpson?s cold relationship with AARP is no secret, but the former Republican Senator from Wyoming took it to a new level Friday. At an event hosted by the Investment Company Institute, Simpson delighted the finance industry audience members by aiming a rude gesture at the leading lobby for senior citizens.Financial and investment interests have long been supportive of Simpson?s broad critique of Social Security, since privatizing the old-age and disability support program would be a tremendous boon for Wall Street?s financial managers. ICI represents mutual funds and other money managers who control more than $13 trillion in assets.Simpson?s forceful gesture came after an extended diatribe against Social Security, which he said is a “Ponzi” scheme, “not a retirement program.?Simpson argued that Social Security was originally intended more as a welfare program.”It was never intended as a retirement program. It was set up in ?37 and ?38 to take care of people who were in distress — ditch diggers, wage earners — it was to give them 43 percent of the replacement rate of their wages. The [life expectancy] was 63. That?s why they set retirement age at 65? for Social Security, he said.In 2010, President Obama appointed Simpson to a deficit commission that recommended cutting taxes and reducing entitlement spending. The commission’s outline is being used as a framework for reform in Congress.Yet Simpson’s comments to ICI reflect an apparent unfamiliarity with the history and foundation of Social Security.HuffPost suggested to Simpson during a telephone interview that his claim about life expectancy was misleading because his data include people who died in childhood of diseases that are now largely preventable. Incorporating such early deaths skews the average life expectancy number downward, making it appear as if people live dramatically longer today than they did half a century ago. According to the Social Security Administration’s actuaries, women who lived to 65 in 1940 had a life expectancy of 79.7 years and men were expected to live 77.7 years.”If that is the case — and I don?t think it is — then that means they put in peanuts,” said Simpson.
Medicare Kill Switch
Raucous town halls this month appear to have persuaded House Republican leaders to back away from their plan to replace Medicare with a voucher program. Now the fall-back for fiscal hawks appears to be mandatory spending caps that will slash both Medicare and Social Security.Former Labor Secretary Robert Reich says this latest plan is just like putting lipstick on a pig?it?s still a pig. Forcing massive cuts to programs vital to millions of Americans still suffering in this economy, while ignoring billions in tax cuts to the wealthiest among us is not fiscal responsibility. Mandatory spending caps simply allow Congress to implement the same devastating cuts?this time from a distance. In this short video, Reich describes in simple terms what the Corker/McCaskill spending cap legislation means to the average American:
The National Committee opposes putting our federal budget on autopilot. We?ve launched Phase Three of our million dollar ad campaign against cutting Social Security and Medicare to pay down our debt. This radio ad, currently running in Washington, D.C., warns Congress the American people do not support cutting Medicare and Social Security.And as our Executive Vice President and acting CEO, Max Richtman, told USA Today:Rather than tackling the root causes of our federal debt, spending caps put our budgeting on autopilot, allowing Washington to claim credit for ?being tough? now and watching from a distance later when across-the-board-cuts slash seniors programs, veterans programs and more. Setting spending levels to match yesteryears? averages ignores today?s reality: huge increases in the cost of healthcare, the creation of the Part D drug benefit, increased homeland security spending in the post 9-11 era, multiple unfunded wars, an aging America and historically low tax levels. Pretending today?s America is yesterday?s America is risky business. If cutting trillions of dollars from vital programs serving millions of middle-class Americans while maintaining tax cuts benefiting the wealthiest among us is Congress? plan for our future, then our Senators and Representatives should come to the American people and make that case. Budget caps are nothing more than a Medicare Kill Switch that fiscal hawks are itching to flip.
USA Today OpEd: Congress Can’t Escape Reality
The Public Doesn’t Buy the GOP’s “CouponCare” Solution to Medicare
GOP Budget Chairman Paul Ryan introduced his 2012 budget plan several weeks ago that would end Medicare as we know it.
The Ryan plan would replace the current Medicare program with vouchers and leave seniors and the disabled ? some of our most vulnerable Americans ? hostage to the whims of the private marketplace. Over time, this will destroy the only health insurance program available to 47 million Americans. Vouchers are designed not to keep up with the increasing cost of health insurance? that is why they save money.? Max Richtman, NCPSSM Executive Vice President
On April 15, House Republicans voted to pass this budget. Now, GOP Representatives are home in their districts trying to sell this ?CouponCare? proposal to their constituents. People aren?t buying it.As Congressman Lou Barletta (R-PA) praised Paul Ryan?s Medicare plan at a recent Town Hall meeting, 64-year-old constituent Linda Christman spoke up:
“Excuse me, I’d like to get something off my chest,” she said, standing. “You seem to think that because I’m not effected I won’t care if my niece, my grandson, my child is affected. I do care. What you’re doing with this Ryan budget is you’re taking Medicare and changing it from a guaranteed health care system to one that is a voucher system where you throw seniors on the mercy of for-profit insurance companies.”
Although supporters of Paul Ryan?s plan claim they are ?saving? Medicare for future generations, they are quick to mention these changes won?t affect current Medicare beneficiaries. Something?s not adding up:
That message is crucial if Republicans hope to win support for their plan to privatize the popular government-run program, said John Feehery of Quinn Gillespie Communications and a former Republican congressional staffer.“In order to be able to sell it, you’ve got to come up with a communications plan that tells senior citizens that are 55 and over that this is not going to touch you,” Feehery said.
People under 55 are getting a raw deal. The Republicans know it. So do seniors. They?re not swayed by reassurances about their own benefits because they also care deeply about the future of Medicare for their own children and future generations of beneficiaries.Poll after poll confirms what we already know. Americans support Medicare and oppose cuts and believe the program is successful in helping older people access needed health care. It?s encouraging to see people speaking up. Linda Christman isn?t the only person asking her representative to be honest about this proposal. Several other papers picked up stories of constituents opposing the Paul Ryan Medicare plan. If you want to contact your representative, go to our Legislative Action Center and send the letter ?GOP Budget Wants to Turn Medicare Over to Private Insurance Companies.?
Welcome to Wall Street Journal’s Social Security Dream World
It’s never a surpise to see yet another Wall Street Journal opinion writer extolling the values of privatization, vouchers and the demonization of the average American. However, this opinion piece written by former member of the Reagan administration was particularly ridiculous. In a nutshell, he claims that American seniors will become millionaires thanks to Social Security and Medicare. No, really—that’s what he said.
Readers may recall the 1950s TV show, “The Millionaire,” which portrayed stories of individuals who were given a “no strings attached” gift of money by an anonymous benefactor. Each week in one of the show’s opening scenes, a man representing the wealthy benefactor, John Beresford Tipton Jr., knocked on an unsuspecting recipient’s door and announced: “My name is Michael Anthony and I have a cashier’s check for you for one million dollars.”That TV program is scheduled to return next year as a reality show, and the new recipients will be the typical husband and wife who reach age 66 and qualify for Social Security. Starting next year, this typical couple, receiving the average benefit, will begin collecting a combination of cash and health-care entitlement benefits that will total $1 million over their remaining expected lifetime.
Alternet provides an easy to understand description of why this analysis is flat-out wrong:
All of this, Cogan says, is according to his own calculations based on government data. It’s all wrong, however, and while it’s often difficult to say with any certainty whether someone is intentionally lying to people or simply making an honest error, in this case it’s clear.Cogan’s sleight of hand is simple: when he gives the amount this average couple paid into the two programs, he adjusts for inflation to current dollars. On the benefits side, he doesn’t ? he uses future dollars, which results in a larger number. John Cogan is a professor of public policy at Stanford University; every one of his students knows that he or she would get an F comparing inflation adjusted numbers on one side of the ledger to nominal dollars on the other ? it’s apples and oranges and it’s about as mendacious as one can get.
Our Executive VP and Acting CEO, Max Richtman, also challenges the clearly political inter-generational warfare angle of this piece in his letter to Wall Street Journal editors. Since there’s not a chance his letter will ever see print, we offer it to you here:
Dear Editor:Maybe John Cogan?s neighborhood is full of ?Millionaire Retirees? (The Millionaire Retirees Next Door, May 12th) but out here in the real world, one out of three seniors in the United States is economically insecure and living under twice the federal poverty line, at $22,000 per person. Contrary to Cogan?s ?greedy geezer? mythology, the average annual Social Security check is a modest $14,000 and it doesn?t come from an ?anonymous benefactor?.While portraying Social Security and Medicare beneficiaries as millionaires fits the absurd rhetoric so popular in conservative circles these days, it conveniently ignores the reality that working Americans of all ages and political parties understand: the government doesn?t fund Social Security, workers and their employers do. Social Security keeps millions of families from poverty each year while Medicare provides life saving health coverage for a population which private insurers won?t serve without massive government subsidies. No one is getting rich on Social Security and Medicare, although clearly Wall Street and private insurance companies would like to do exactly that, while also passing the bill along to middle-class America.Max RichtmanExecutive Vice President/Acting CEONational Committee to Preserve Social Security and Medicare10 G Street, NE, Suite 600Washington, DC 20003(202) 216-8378
Alan Simpson’s Confused about Social Security – Still
Alan Simpson Attacks AARP, Says Social Security Is ‘Not A Retirement Program’ (VIDEO)
WASHINGTON — Alan Simpson?s cold relationship with AARP is no secret, but the former Republican Senator from Wyoming took it to a new level Friday. At an event hosted by the Investment Company Institute, Simpson delighted the finance industry audience members by aiming a rude gesture at the leading lobby for senior citizens.Financial and investment interests have long been supportive of Simpson?s broad critique of Social Security, since privatizing the old-age and disability support program would be a tremendous boon for Wall Street?s financial managers. ICI represents mutual funds and other money managers who control more than $13 trillion in assets.Simpson?s forceful gesture came after an extended diatribe against Social Security, which he said is a “Ponzi” scheme, “not a retirement program.?Simpson argued that Social Security was originally intended more as a welfare program.”It was never intended as a retirement program. It was set up in ?37 and ?38 to take care of people who were in distress — ditch diggers, wage earners — it was to give them 43 percent of the replacement rate of their wages. The [life expectancy] was 63. That?s why they set retirement age at 65? for Social Security, he said.In 2010, President Obama appointed Simpson to a deficit commission that recommended cutting taxes and reducing entitlement spending. The commission’s outline is being used as a framework for reform in Congress.Yet Simpson’s comments to ICI reflect an apparent unfamiliarity with the history and foundation of Social Security.HuffPost suggested to Simpson during a telephone interview that his claim about life expectancy was misleading because his data include people who died in childhood of diseases that are now largely preventable. Incorporating such early deaths skews the average life expectancy number downward, making it appear as if people live dramatically longer today than they did half a century ago. According to the Social Security Administration’s actuaries, women who lived to 65 in 1940 had a life expectancy of 79.7 years and men were expected to live 77.7 years.”If that is the case — and I don?t think it is — then that means they put in peanuts,” said Simpson.
Medicare Kill Switch
Raucous town halls this month appear to have persuaded House Republican leaders to back away from their plan to replace Medicare with a voucher program. Now the fall-back for fiscal hawks appears to be mandatory spending caps that will slash both Medicare and Social Security.Former Labor Secretary Robert Reich says this latest plan is just like putting lipstick on a pig?it?s still a pig. Forcing massive cuts to programs vital to millions of Americans still suffering in this economy, while ignoring billions in tax cuts to the wealthiest among us is not fiscal responsibility. Mandatory spending caps simply allow Congress to implement the same devastating cuts?this time from a distance. In this short video, Reich describes in simple terms what the Corker/McCaskill spending cap legislation means to the average American:
The National Committee opposes putting our federal budget on autopilot. We?ve launched Phase Three of our million dollar ad campaign against cutting Social Security and Medicare to pay down our debt. This radio ad, currently running in Washington, D.C., warns Congress the American people do not support cutting Medicare and Social Security.And as our Executive Vice President and acting CEO, Max Richtman, told USA Today:Rather than tackling the root causes of our federal debt, spending caps put our budgeting on autopilot, allowing Washington to claim credit for ?being tough? now and watching from a distance later when across-the-board-cuts slash seniors programs, veterans programs and more. Setting spending levels to match yesteryears? averages ignores today?s reality: huge increases in the cost of healthcare, the creation of the Part D drug benefit, increased homeland security spending in the post 9-11 era, multiple unfunded wars, an aging America and historically low tax levels. Pretending today?s America is yesterday?s America is risky business. If cutting trillions of dollars from vital programs serving millions of middle-class Americans while maintaining tax cuts benefiting the wealthiest among us is Congress? plan for our future, then our Senators and Representatives should come to the American people and make that case. Budget caps are nothing more than a Medicare Kill Switch that fiscal hawks are itching to flip.
USA Today OpEd: Congress Can’t Escape Reality
The Public Doesn’t Buy the GOP’s “CouponCare” Solution to Medicare
GOP Budget Chairman Paul Ryan introduced his 2012 budget plan several weeks ago that would end Medicare as we know it.
The Ryan plan would replace the current Medicare program with vouchers and leave seniors and the disabled ? some of our most vulnerable Americans ? hostage to the whims of the private marketplace. Over time, this will destroy the only health insurance program available to 47 million Americans. Vouchers are designed not to keep up with the increasing cost of health insurance? that is why they save money.? Max Richtman, NCPSSM Executive Vice President
On April 15, House Republicans voted to pass this budget. Now, GOP Representatives are home in their districts trying to sell this ?CouponCare? proposal to their constituents. People aren?t buying it.As Congressman Lou Barletta (R-PA) praised Paul Ryan?s Medicare plan at a recent Town Hall meeting, 64-year-old constituent Linda Christman spoke up:
“Excuse me, I’d like to get something off my chest,” she said, standing. “You seem to think that because I’m not effected I won’t care if my niece, my grandson, my child is affected. I do care. What you’re doing with this Ryan budget is you’re taking Medicare and changing it from a guaranteed health care system to one that is a voucher system where you throw seniors on the mercy of for-profit insurance companies.”
Although supporters of Paul Ryan?s plan claim they are ?saving? Medicare for future generations, they are quick to mention these changes won?t affect current Medicare beneficiaries. Something?s not adding up:
That message is crucial if Republicans hope to win support for their plan to privatize the popular government-run program, said John Feehery of Quinn Gillespie Communications and a former Republican congressional staffer.“In order to be able to sell it, you’ve got to come up with a communications plan that tells senior citizens that are 55 and over that this is not going to touch you,” Feehery said.
People under 55 are getting a raw deal. The Republicans know it. So do seniors. They?re not swayed by reassurances about their own benefits because they also care deeply about the future of Medicare for their own children and future generations of beneficiaries.Poll after poll confirms what we already know. Americans support Medicare and oppose cuts and believe the program is successful in helping older people access needed health care. It?s encouraging to see people speaking up. Linda Christman isn?t the only person asking her representative to be honest about this proposal. Several other papers picked up stories of constituents opposing the Paul Ryan Medicare plan. If you want to contact your representative, go to our Legislative Action Center and send the letter ?GOP Budget Wants to Turn Medicare Over to Private Insurance Companies.?