Social Security is in real trouble and Alan Simpson is spitting mad at the two groups he thinks are standing in the way of reform. Turn em off, says Simpson, they’re all phonies …. and just for good measure, the AARP is just a bunch of marketers. “They sell stuff”.
Alan Simpson, co-chair of the President’s deficit commission let’s it all hang out, as he usually does, in going after the people he believes are leading the charge against social security reform. And based on figures released last night, he has good reason to be angry.
First, they’re raising the red storm flag a little earlier than expected on the solvency of social security. The CBO reports that Social Security will begin paying out more in benefits than it takes in THIS YEAR, instead of 2016 as previously projected.
Social Security will post a $45 billion shortfall in fiscal 2011 and will pay out more in benefits than it accepts in payroll taxes through at least 2021 without legislative changes, the Congressional Budget office said on Wednesday.
The CBO made the forecast in its twice-annual assessment of the U.S. budget. The non-partisan office, which provides budget and economic analysis to the U.S. Congress, said that deficits would total $547 billion over the period from 2012 to 2021.
It get’s worse. The CBO reports if something isn’t done the fund will run dry in 2037. And if something isn’t done you can lay some on the blame on the friends of old people, AARP and, while he doesn’t mention them by name, the National Committee to Preserve Social Security and Medicare. The latter, headed up by Connecticut’s own Barbara Kennelly, has been running adds against Republicans and Simpson’s Committee, charging they want to eliminate the programs and privatize them. That was enough to set Simpson off. It’s a great bite because he also explains what he would like to do.
What brought about the accelerated decline of the SSTF? AP at Hot Air makes a strong case here, with some depressing charts.
Remember the payroll tax cut for employees that was part of last month’s tax cuts deal? Democrats warned at the time that that would play into the GOP’s hands on entitlement reform by establishing a new lower baseline rate that’s insufficient to fund the program. (The current rate is temporary, but as we’ve learned, temporary tax rates are hard to raise.) The result: An accelerated, expanded shortfall in Social Security that will inevitably intensify cries that the program is unsustainable and needs to be reformed. Which, of course, it does:
Indeed. Both Simpson and Paul Ryan have offered reform plans. Neither would change the current program for people over 54 years old. For younger workers, options for retirement would be voluntary. Here’s Paul Ryan’s outline. As Alan Simpson reminded viewers last night, SS was never meant to be a retirement program and unless young people can be convinced to begin planning for retirement, sans SS, the program will collapse. It makes you wonder, are these groups really trying to help senior citizens, or simply preserve a failing federal program that is the flagship of progressivism? I think the latter.
UPDATE: Here’s Simpson’s Commission Plan. http://www.fiscalcommission.gov/