And they damn well know it!

In the mid-80’s, Ronald Reagan sat down with Speaker Tip O’Neill and crafted a few fixes to secure Social Security as a self-funding program for the next quarter century. It worked, just as planned. They knew, as did congress then and as does congress now, that future congresses would be required to do the same from time to time. They knew then as they know now, that Social Security is sound policy and a sound program, unless . . . .

For nearly a century, this marvel of policy engineering has kept generations of our elders out of poverty.

For all of that time, it’s also had enemies, determined to destroy it. In the 80’s, Reagan and O’Neill and the sensible policy establishment (much more centrist then) in Washington hadn’t yet heard of Newt Gingrich or Grover Norquist or Pete Peterson (well, those aforementoined  ‘enemies’ had heard of Peterson all right – he financed them).  Nor did they know that a well-funded campaign was already underway to convince younger Americans that SS wouldn’t be there for them, while quietly engineering its destruction.

They’ve pretty much succeeded. Because they knew that all it would take to break Social Security was to refuse to fix it.

29 responses to “And they damn well know it!

  1. Dear Moe,
    I cannot find an e mail on gravatar to communicate so I am using the comment thing. I would dearly love permission to reblog your post about Bernie Sanders comments on Social Security and I would give you the attribution if you can see your way clear to grant the permission. If not that is alright too and I understand. Thanks in advance for whatever consideration you can give. Please just respond by e mail if you desire to. Or use my “Contact Me” form on the following blog:
    http://thelimingview.blogspot.com/

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    • John, first of all, what a delight to see you here. I think we’ve bumped into each other a few times – at bruce’s?

      I’ll email you so you lhave my address, but meanwhile please go ahead and reblog. And feel free at any time. We all love those trackbacks, don’t we!

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    • John, I filled out your contact me page, but am not sure it got through. Let me know if it didn’t.

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  2. Your last line says it all.

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  3. Now explain to me why we should further tax those who will never measurably benefit from SSI in order to save it?

    Really, why should I, who will never care about the pittance that SSI will provide me, have to pay even more into it?

    Oh, and yes, if there was some way that I could turn the benefits over to someone who needed them more, I’d most likely do so.

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    • Social Security must remain universal; that is part of its beauty. Were it otherwise, it would devolve into a welfare program and be another thing for Americans to fight over. So even if that means that Mitt Romney gets it when he’s 67 along with Bush and Obama, so be it. That’s fine.

      Most Americans’ WAGE contributions to Social Securtiy are deducted from 100% of their wages – and remember, that’s only wages, not all income. But those earning over $110K only pay 100% up to that level.

      So Bernie’s right – raise that exemption to $250K (Reagan and O’Neill raised it) and a huge headache for this nation is solved. Pretty painlessly.

      You would pay only on wages paid by an employer or by yourself to you if self employed and you’d be paying at the same rate as evveryone else.

      Glad that it’d be only a pittance – for you. Well done.

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      • I believe that there’re are better ways to improve SSI, which was originally intended to be opt-in, than raising the contributions of 5% or so of the more well-paid workers and businessmen in order to keep it solvent for all the others.

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        • I know what it was intended to be at first, but our government over these 80 years has changed it gradually and why not? Times change, needs change, people change, laws change. And if we fuck that part up, we change it again. Or we should, although lately . . .

          What kind of ‘better ways’ that keep the program intact and are relatively painless?

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          • Change what the SSI trust fund can invest in for one thing. Why can’t we use it like we use the Sovereign Wealth Fund and invest in foreign debt instead of US debt?

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            • Too wonky for me!

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              • How is it wonky, Moe. Politicians already debased the SSI trust fund by forcing it to invest in US debt. What’s wonky or wrong about investing in foreign debt instead?

                After all, the government buys a lot of foreign debt for other purposes – as do most other governments.

                Instead of taxpayers’ money being added to the fund, it would be “new” money coming in from outside the US. That would literally and simply not only likely ease the insolvency problem but eliminate ANY legitimate complaint that SSI was an entitlement program.

                It would turn SSI into a de facto “People’s co-opt” that was investing at the highest level of investment, that of sovereign nations.

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                • Oh dear, you misunderstood my comment – when I say ‘too wonky for me’, I mean it’s over my head. I don’t even know what a Sovereign Wealth Fund is.

                  I am, you see, not omniscient.

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    • By the way, I think a very good case can be made for means testing some of Medicare.

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  4. Could it be that Reagan started out as Democrat?

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    • He did james – he was the very liberal prez of the Screen Actors Guild until the 1950’s when General Electric got hold of him. And that, my friend, is some amazing story.

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  5. Ms. Holland ,
    ” Pretty painlessly. ”

    Democrats have always claimed that . Just screw the rich guy around the corner and moi the little guy will feel no pain . But even your solution which is no solution, even your solution wasn’t put forward by President Obama .

    One of the stories about why Ronald Reagan became a Republican goes back to when as an actor , the tax code made it not worth it for him to make more than 4 movies per year . When taxes provide a disincentive to work and earn more money, those taxes hurt the economy.

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    • Wrong on Reagan Alan. Read a few biographies; I”ve read three and would recommend Dutch, a terrific read as well as a fine history.

      I know Obama didn’t put it forward. I wish he would. As for ‘my solution’ which you say is ‘no solution’, it’s exactly what Reagan and O’Neill did in the 80’s. Exactly.

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      • I think you’ve read some poor biographies or Reagan or we’re using quite different definitions of “liberal” to describe his extensive tenure as President of SAG, Moe.

        Also, GE is who “got hold of him.” That would be MCA.

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        • It was GE. I don’t think MCA even existed. He hosted GE THeatre for 8 years (1954-62) and .. . there’s a narrative of that history here:
          http://hnn.us/articles/32681.html

          He was a liberal Democrat – a Roosevelt man, a Truman man. He chaged. People do. I was in YAF in my 20’s. Yikkes.

          But make no miistake, GE formed RR poliitically. It’s a fascinating story.

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  6. Ms. Holland ,
    ” Wrong on Reagan Alan. Read a few biographies; I”ve read three and would recommend Dutch, a terrific read as well as a fine history. ”

    I cannot 100% vouch whether the tale is true or not , but I traced the story back to this piece in the NY Times by a former Bush economic Adviser Prof. Mankiw.

    http://www.nytimes.com/2009/11/01/business/economy/01view.html?_r=1&scp=1&sq=supply%20side%20ideas&st=cse

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    • Of course you can’t ‘vouch’ for it because its not true. Greg Mankiw? I did’t read the story (out of NY Times links for the month) but I’m sure the good perfesser uses old Ronnie Reagan wheever he can to try to bolster his discredited ‘supplly side economics’ theory.

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  7. Reblogged this on American Liberal Times and commented:
    I want to thank Moe for permission to reblog this very critically important article and I hope this information gets as much national and global exposure as it is humanly possible to give it. It is that important!

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  8. “They’ve pretty much succeeded. Because they knew that all it would take to break Social Security was to refuse to fix it.”

    Isn’t this the Republican Party Platform? Just refuse to fix anything?

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    • Welcome fathercane ! . . . just visited your place and I see we share quite a few sentiments (my new word for opinions). Nice blog and I’ll be stopping in again; hope to see you here again too.

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  9. Hi Moe nice blog, I found it after John reposted it on his blog. Your solution makes the most sense, I have always said that by raising it to 250,000 would be painless to the rich, but raising the retirment age and slashing benifiets would be devastating to the middle class and the poor. Someone said here in your comments it wouldn’t befair to raise the amount the rich pay, who don’t need it and get little benefit from it. I say its not fair the rich have the tax deductiontions that the common man doesn’t have. When Warren Buffet pays a lower tax rate then his secretary something is wrong with the system.

    I have 3 years to retirment and I am scared to death about this next election cycle. I know if Republicans take control of the Senate or the Presidentcy, one of the first things they will do is raise the retirement age on Social Security and slash benefits, instead of the simple fix of raising the amount of income that is taxed for it.

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    • Hi Gordon! Welcome, glad you found you way here.

      One of the things that drives me nuts is that people keep saying the SS age is 65. It is not and hasn’t been for over ten years. The deal Regan and O’Neill crafted created a multi-decades process wherein the retirment age gradually moved up to 67. For instance, my dad retired with full benefits at 65. I wasn’t eligible till 65 and ten months. My sister and brother who are three years younger are eligible at 66 years, one month. I think they add a month a year to the eligibility age.

      for someone born in 1955, to get full retirement beneifts the age is 66 and ten months.

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  10. Found you via the above image / declarations.. Shared on googleplus ie:

    PLEASE DO JOIN US THERE! ;]]] Peace & bSAFE!

    tech9iner [Hacim Llih]

    Like

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