Social Security Debate Gets Shortchanged

As the debate about Social Security continues, the major news media often pass along the misinformation of partisans without providing, when available, definitive, contradictory information to the news consumer.

This disappointing brand of journalism appears again in the Jan. 30 Times story, “They Invested Years in Private Accounts,” which states President Bush “drew from a controversial 1998 Heritage Foundation paper arguing that African Americans were shortchanged by the current system because of their shorter life spans.”

What The Times fails to tell the reader is that years ago the Social Security Administration authoritatively debunked the partisan Heritage Foundation paper the president relies on for his “controversial” claim.

The SSA review states, “Results from more careful research reflecting actual work histories for workers by race indicate that the non-white population actually enjoys the same or better expected rates of return from Social Security than for the white population.”

There is no controversy in this matter. The Times reports that conservatives have spent 20 years building an effective, multifaceted political campaign to bring about a major transformation of the Social Security system.

By characterizing an established falsehood as a “controversial” claim, The Times and others are allowing this conservative campaign to misinform the public and, thereby, cheat the Social Security debate.

Michael Cohen

Gilbert, Ariz.

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Re “Two Paths to Social Security Investment Accounts Mapped,” Jan. 30: The president has been saying, and will repeat many times in coming weeks, that if we don’t privatize Social Security it will be “flat bust, bankrupt” by 2042.

But he and his advisors know this is not true: Even once the surplus in the trust fund is depleted (around 2042), if the system continues on a pay-as-you-go basis, retirees will still get most of the benefits they get now, and they’ll get all of their benefits if payroll taxes are raised only 1.9%.

So, as usual, the president is lying to us. Why is it so hard for the so-called liberal media to admit when this president lies?

Historically, Republicans have been attacking Social Security for the entire 70 years we’ve had it. If we Americans sit on our hands and let them destroy it now, with their 51% “mandate,” we deserve to die in poverty.

Vern P. Nelson

Huntington Beach

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A simple spreadsheet calculation based on conservative expectations shows that the average person would do better investing in Treasury bills in a forced savings account than in the current system of Social Security. If we are willing to accept the transition costs, there are several good reasons to change to a forced savings system.

The most important is that the average person would know exactly what his or her assets were upon retirement.

There would be no “cost of living” increases or lobbying for benefits by AARP. The ratio of workers to retired persons would no longer matter.

The current entitlement system decouples contributions from withdrawals, creating irrational expectations for current beneficiaries.

If you know how much you actually have, you know how much you should spend. This would create a virtuous circle of saving and investing. People would be able to save more than the minimum if they so chose, and would know that their standard of living in retirement depended on a balance of a low-risk, low-return forced-savings safety net and other optional investments.

Jim Ketcham

Malibu

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What happens to those who choose to invest part of their earnings in the stock market rather than Social Security deductions and don’t plan or manage those investments well? Won’t those folks then be subsidized by the government anyway?

Marty Wilson

Whittier

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Re “New Idea for This Side of the Pond,” Jan. 29: Rep. Bill Thomas (R-Bakersfield) proposes to use a value-added tax to pay for Social Security benefits. Isn’t this a nonstarter as retirees are currently exempt from payroll taxation while a value-added revenue taxes both retirees and working people?

Wouldn’t this be equivalent to a reduction in benefits for the retiree?

R.P. Irvine

Westlake Village