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Man Picked to Make Changes to Social Security Doesn’t Understand Basic Concepts of Social Security
I mentioned yesterday, and Michael Whitney reinforced, that Alan Simpson denigrated some data on Social Security because he decided the figures came from “the Catfood Commission people.” And that’s a feather in someone’s cap, I guess.
But it’s worth jumping into what that actual data was that Ryan Grim confronted him with. Because it reveals Simpson, as if this needed revealing, to be utterly clueless about the Social Security system and basic demographic realities. So here’s what prompted Ryan’s question:
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.
This is something Simpson has said for some time, and it is based on total ignorance. So Ryan called him on it.
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 [...]
Told that the data came directly from the Social Security Administration, Simpson continued to insist it was inaccurate, while misstating the nature of a statistical average: “If you’re telling me that a guy who got to be 65 in 1940 — that all of them lived to be 77 — that is just not correct. Just because a guy gets to be 65, he’s gonna live to be 77? Hell, that’s my genre. That’s not true,” said Simpson, who will turn 80 in September.
So faced with information that conflicts with his worldview, here’s what Simpson does:
1) first he says he doesn’t believe it.
2) then he applies the same “lucky duckies” treatment to the “greatest generation,” folks that lived through the Depression, to denigrate their receipt of Social Security benefits
3) then he just throws up some nonsense that shows he doesn’t understand statistical averages, which don’t mean that every single individual who reached 65 made it to 77 in the 1940s.
All you have to do is look up the very first recipient of monthly Social Security benefits, a woman named Ida May Fuller, who paid a grand total of $24.75 into the system, lived to be 100 years old, and received $22,888.92 from Social Security. And this should not be denigrated but celebrated as the system of social insurance working. The age of 65 was chosen as the retirement age because of general observations about retirement ages for civil service professionals at the time, not to cheat people out of their benefits, as Simpson would have you believe.
In actuality, the life expectancy at age 65 has increased to the extent that Social Security is paying out more benefits for a grand total of 3 years, after 70 years in operation. This is why the system endures, with minor changes (the retirement age has already increased to 67), because the people who designed it built in the flexibility and buildup of benefits in the trust fund to account for any population pattern shifts. About the only thing they didn’t expect was the massive, rampant inequality that made the payroll tax cap lead to a far lower collection in revenues than expected. That can be altered and the program saved with relative ease.
Simpson concluded his evasions by claiming that only Ryan Grim dared to challenge his figures, so he must be doing something right.
Simpson said that questioning his data wasn’t helping to solve the underlying problem.
“This is the first time, the first time — and Erskine [Bowles, the deficit commission co-chair,] and I have been talking for a year and many months — that anyone’s going to sit around and play with statistics like this,” he told HuffPost. “Anything I tell you, you repudiate. You’re the first guy in a year and a half who’s stood out here with a sharp pencil playing a game that doesn’t have a damn thing to do with: ‘What the hell are you going to do with the system?’”
This is a commentary on the poor performance of the media more than anything. But in addition to that, it’s not true: Alex Lawson, one of those Catfood Commission people, challenged him on practically all of this a year ago. We have it on tape.
The fact that Simpson doesn’t know anything about Social Security should come as deeply embarrassing to the elites who elevated him as a point person on deficit reduction and Social Security changes, all the way up to the President of the United States, who appointed him to the commission. But embarrassment over horrible decisions has no place in elite Washington.
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16 Comments so far
Show AllJust because they don't know how to play the game doesn't mean they can't make the rules. This is what happens when the lawmakers either never have, or never will, be affected by the laws they make.
One reason progressives are losing is because so many of them, especially many pundits and press who claim to advocate for them, keep asserting that regressive players (including politicians from both major parties) somehow "don't understand", or that they are "incompetent".
Arizona Senator Jon Kyl's admission last month that his accusation that Planned Parenthood uses 90% of its budget for abortions (when they, in fact, use 3%)
"was not intended to be a factual statement" empiricallly proves that there is no misunderstanding or incompetence among any of the regressive players. Regressives simply, and correctly understand that a lie repeated three times and left unchallenged becomes a fact.
Regressives have made phenomenal economic and political gains during the past 30 by simply telling more lies than anybody had the means to challenge. They have laughed all the way to the bank while progressives have expounded on how regressives "don't understand" or "are incompetent".
Every so often, when unreasonably coherent people become old and of little use to a society, someone decides it’s time once again to appoint these useless souls to solve their unsolvable problems.
A long time ago, before the additions of benefits for their dependents, survivors of deceased workers, the disabled worker, aid to the blind, supplemental income, cost of living adjustments, un-employment compensation and hospital insurance to the elderly shifted the balance between money coming in from taxes and benefits going out of the fund, Social Security worked quite well.
Had we left what began as a program guarantying social support for all U.S. citizens who were economically vulnerable during the Great Depression well enough alone, perhaps the strife of eternal modification and inclusiveness would not have dumbfounded a nation. Instead, lawmakers tinkered with superannuation of the aged, altering it with more than twenty amendments resulting in their continuous admonition of insolvency, singling out the baby boomers as the chief culprit.
Simpson is just another tool put out there to convince us all that the unsustainable will be sustained while the social and cultural rights that were once indispensable for our dignity have become nothing more than entitlements destined for reduction and postponement.
The author makes a terrible mistake with this article. Of course Alan Simpson understands what Social Security is. His assignment is to destroy it. Trying to debate or somehow bring him to his senses is a useless waste of time; chasing down a representative of the top 1% when the other 99% are waiting to be organized. I'd guess the farthest thing from Dayen's mind is pulling off the gloves and calling for a full-on melee with those who'd like to exterminate us.
This article exemplifies the destruction of liberalism, noted most prominently by Chris Hedges.
Simpson is almost done in this lifetime :) As one who believes in reincarnation, his next physical manifestation can only be surmised, but I'm guessing he'll exist in an extremely 'needy' form.
Simpson knows enough about Social Security to rig it to privatization and then demolition. He's for SS as long as he gets his guarantee while not giving a fig about ordinary seniors and he's a perfect fit for that POS commission.
Putting Simpson in charge of "reforming" (i.e. eliminating) Social Security is like putting Grover Norquist in charge of the IRS. And Obama would probably do that if he could. When Gates retires, maybe Obama can get Cheney to come back as Secretary of Defense. After all, he's so experienced!
Obama's appointees have been no better than Dubya's. Obama has appointed nobody who is left of center and only a few centrists, but only to posts where they would have no influence on anything.
The Social Security trust fund is real, it exists, it is valid, it is not a bunch of worthless IOUs. The right wing-libertarian mantra is that the trust fund doesn't exist and that it's made up of worthless IOUs. This is repeated 24/7 on all the right wing radio and TV programs. The trust fund is worth about $2.6 trillion, earning interest every day. The trust fund is made up of US treasury bonds backed by the full faith and credit of the US government, just like the treasury bonds held by foreign governments (China, Japan, etc.) and held by millions of Americans. If the USA selectively decides to default on the SS trust fund treasuries but not the treasury bonds I bought years ago or that China holds, it will make a mockery of our whole economic system. The SS trust fund treasuries are just as valid as our currency or treasury bonds held by millions of Americans or foreign governments. SS can pay full benefits through 2037, even if nothing is done and after 2037, SS could still pay about 78% of benefits. Just raise the cap on the wage tax and SS will be solvent for many decades after 2037.
That we haven't voted out all conservative politicians is testament to how effective their liberal demonizing and conservative glorifying through the years has been.
The Cat Food Commission is like a zombie, it just won't die and it's intent upon eating our brains. This garbage commission ended its gig last year and the members of the commish could not come to a consensus on what to do about the deficits. So could we please just bury this disgusting commission once and for all and laugh off any recommendations that Simpson and Bowles might have put forward. Why the hell was this deficit commission even talking about Social Security which contributed nothing to the deficit, is not in crisis, is solvent for decades, which never goes broke and which has its own dedicated funding stream. Everything was on the table except restoring the top marginal tax rates to what they were before Reagan, strongly regulating corporations, restoring Glass-Steagall, taxing capital gains at least at 39% and imposing a transaction tax on stocks, for example.
'So could we please just bury this disgusting commission once and for all and laugh off any recommendations that Simpson and Bowles might have put forward. '
Unfortunately, no. Obama appointed these neanderthal's precisely because he would get the desired outcome; he already said he would abide by the commission's recommendations. It's yet another way democrats are playing the neoliberal game while deflecting blame for it. ['Well, my bi-partisian commission concluded we should gut SS. We must listen to the experts' will be the battlecry]
The vile old fart Alan 'shitforbrains' Simpson wants nothing to do with anything that has 'SOCIAL' in its title. That is really why the hard-right-wing has a hard-on for the utter destruction of Social Security. Dubya's first wish when he was re-elected in 2004 was not peace in the world, not eliminating nuclear weapons, not solving the health crisis, or the energy crisis, or the debt crisis, or any of the many real problems of the nation and the world; no, instead it was grabbing the Social Security revenues and savings and trust fund for Wall Street, thereby inflating stock prices and making the rich richer.
This is because rightwingers insinctively know it is Social-IST Security! It is not some mutual fund investment or some hedge fund, it IS welfare for we the people, and it will NOT go bankrupt until the entire NATION is bankrupt. So they must destroy it.
Though there is now a trust fund for Social Security, this was merely a way that the right-wing, Ayn Rand-loving super-villain Alan Greenspan found to tax ordinary Americans more instead of rich folks, and yet have a smaller 'total' Federal deficit by usurpation of this fund by politicians. But this fund does provide a safety backup for its original mode of funding, of current workers supporting current retirees, and provides another justification for the continuation of Social Security, which is about the most secure institution there is now. (Where is the military trust fund?)
Among the many idiotic, most moronic moments of Bush was the time he went to Social Security headquarters and held up the IOUs from HIS OWN administration (special government bonds) and squawked about how the Social Security trust fund was just a bunch of worthless paper... kind of like his assessment of the Constitution of the United States.
So let me get this straight... guy goes to lender and says lender is in trouble because the note promising to pay back a loan the same guy gave lender to get the loan is worthless paper even though guy can pay... hmm, guy sounds like a real asshole, and is really the one in monetary trouble now, not the lender.
No, the right-wing wants to destroy Social-ist Security precisely because it WORKS and WORKS TOO WELL! Why, people may get the idea that socialism works, and works better than capitalism! Why, that cannot be allowed! Thus, this model-for-civlization must be stomped out! (Though the rightwingers are happy to take massive government welfare to save their own bacon from their self-induced financial crises, 'cause after all, they "deserve it"- unlike those lazy Social Security-sucking bastards. And after taking trillions for themselves, they say, well, none left for YOU!)
And Alan 'fuk-em' Simpson is glad to do the stomping, using his Capitalist Death Panel. And to top it off, after they tear it down, the rich get to grab that Social Security pot o'gold! And a whole bunch of new suckers to rob to boot! No wonder the American Grifter Simpson sez count me IN on that GRIFT!