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United States News Title: Democratic Group Would Eliminate Social Security for Wealthy A Democratic-led policy group is proposing changes in Social Security that party members have resisted for years in an effort to pave the way for recommendations this week by President Barack Obama’s deficit-cutting commission. Washington-based Third Way said its plan would raise the retirement age, trim or eliminate Social Security benefits for high-income retirees, limit cost-of- living increases and provide money to help young workers create private retirement accounts. The proposal, to be released after the presidential panel is due to issue its report on Dec. 1, is timed to help create a buffer for congressional Democrats to support politically unpopular deficit-trimming measures, said Third Way spokesman Sean Gibbons. “Whatever comes out of the commission is going to be a hot potato,” Gibbons said. “So we wanted to send something over that was especially hot.” Social Security costs will exceed tax revenue beginning in 2015, according to the trustees’ 2010 report. The shortfalls will be covered by the plan’s trust fund until 2037, when those reserves are projected to be exhausted. Over the next 75 years, the trust fund would need another $5.4 trillion in current dollars to pay all scheduled benefits. Last month the Obama commission’s co-chairmen proposed gradually raising the retirement age to 68 and reducing Social Security annual cost-of-living increases, drawing a rebuke from Democrats led by House Speaker Nancy Pelosi of California. ‘Achieve the Goals’ Today her spokesman Brendan Daly said in an e-mail that any debt-reduction proposal must “achieve the goals of reducing the deficit, promoting economic growth and preserving Social Security.” Republicans including House Minority Leader John Boehner of Ohio, set to become speaker in January, have argued for raising the retirement age and limiting or halting benefits for higher- income retirees. Most Democrats have opposed such means-testing out of concern that Social Security would become a poverty program and lose support among higher-income voters. “The strongest and loudest voices on the left have nailed up the barricades on Social Security and said ‘hell, no’ and don’t want any type of cuts in benefits at all,” Third Way co- founder Jim Kessler, former policy director to Senator Chuck Schumer of New York, said in an interview. In September, more than 100 House Democrats and 20 Democratic senators signed a letter to the commission warning the members not to touch Social Security. Alice Rivlin A handful of Democrats have advocated benefit cuts in addition to tax increases, including former Congressional Budget Office Director Alice Rivlin, a member of Obama’s debt commission, and Bill Galston, a former domestic policy adviser to President Bill Clinton. The Third Way proposal is “an effort to break the silence, to make it a little easier for congressional Democrats who are thinking these thoughts privately,” Galston said. Third Way describes itself on its Website as “the leading moderate think tank of the progressive movement.” The chairman of the group’s board of trustees is John L. Vogelstein, former president of private-equity firm Warburg Pincus LLC, and the vice-chairman is David Heller, global co- leader of Goldman Sachs Group Inc.’s securities division. Among the 12 Democratic members of Congress listed as honorary co- chairmen are Representative Jane Harman of California and Senator Evan Bayh of Indiana. Bipartisan Policy Center Obama’s deficit panel needs agreement from 14 of its 18 members to send a plan to Congress. Rivlin also is a member of the Bipartisan Policy Center in Washington, which on Nov. 17 proposed increasing the amount of wages subject to Social Security payroll taxes and reducing the growth in benefits. The plan by Kessler’s group, a copy of which was provided to Bloomberg News, will propose boosting monthly benefits for the lowest-income retirees while reducing them for higher earners. Cost-of-living increases would be smaller. Some retirees would have to pay taxes on their full Social Security payments. Currently, individual retirees with $34,000 in outside income and couples with $44,000 must pay taxes on 85 percent of their benefits. The Third Way plan would require individuals earning $50,000 a year and couples receiving $60,000 to pay taxes on 100 percent of the benefit. Social Security benefits would be reduced on a scale starting at individuals with $150,000 in outside income and couples with $250,000, and eliminated altogether for individuals earning $200,000 and couples with $400,000 in income. ‘Should Not Receive It’ “Those who should not need Social Security at all should not receive it during their high-income years,” the proposal said. The retirement age, now scheduled to rise to 67 in 2027, would gradually increase to 68 by 2041, to 69 by 2059, and to 70 by 2077. This would reduce total benefits by roughly $1 trillion by 2040, according to the plan. The plan would provide annual subsidies of up to $500 to help workers under age 30 create 401(k)-style retirement savings accounts. It also proposes various options for tax increases, including raising the payroll tax cap from $106,800 to $190,000 by 2020. Tim Penny, a former Minnesota Democratic congressman who served on Bush’s Social Security commission, said he was “hopeful” about the Third Way report. “Even if you love to death these entitlement programs, and we are in the process of loving them to death, at some point they begin to crowd out everything else,” said Penny. “There’s an immorality to that.” ‘Dealing With Reality’ Some Democratic lawmakers have said the party needs to face up to politically unpopular remedies. “Those who say don’t touch it aren’t dealing with reality,” Senator Kent Conrad, a North Dakota Democrat and chairman of the Budget committee, said in a Nov. 12 interview on CNN. House Majority Leader Steny Hoyer of Maryland said in June that Congress should consider raising the retirement age and providing lower Social Security and Medicare benefits to wealthier beneficiaries. Even the AARP senior citizens’ group that’s long fought benefit cuts appears to be open to at least some cutbacks. John Rother, executive vice president for policy at the senior citizens’ group AARP, praised the Bipartisan Policy Center plan. “It’s more politically realistic” than the Obama panel’s draft and “in general I would characterize this as a more centrist approach,” said Rother.
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#3. To: jwpegler (#0)
All that and ZERO mention of any sort of plan to quit funding various welfare programs with SS money,or to prevent ANYBODY from drawing out of the system that has never paid into it. EVERY SINGLE political and/or religious refugee that is allowed to enter the US starts receiving SS money the very first day he and his whole damn family step foot into the country. So does every member of his family. Not just in a montly check,either. SS money is used to fund the food stamps,medicaid,subsidized housing,and other programs. Including the English language programs. Odd how nobody wants to cut this money,ain't it?
That was true for the last 30 years, but it is no longer the case. Social Security will pay out more in retirement benefits than it takes in this year. Starting in 2014, the Social Security deficit will start ballooning uncontrollably. By the time I am supposed to start receiving benefits in 2025, the entire system will have collapsed under it's own weight. It's not fair or right to make young struggling families hand their money over to rich retirees. We need to means test the program. If you have a substantial company pension or an annuity from your 401K or IRA, you should get nothing from Social Security. For example, if you have retirement income in the top 20% or 25% of all income earners, you shouldn't get a nickel of Social Security benefits. Australia does this. What can't we? Oh, because Simpson is right -- the Greedy Geezer lobby has too much political power.
Yeah,I have heard that,but I don't believe it for a minute. I just don't see the politicians giving up that "free" money so easily. We need to means test the program. If you have a substantial company pension or an annuity from your 401K or IRA, you should get nothing from Social Security. I do agree with that. To those who say,"I paid in so I deserve to get my money back!",I say,"It was a insurance policy you were buying that would provide you with a retirement income if things didn't go well for you and you needed it. You don't need it so you don't get it anymore than you would collect from an insurance policy whose terms you didn't meet." AND.....,the ONLY ones who should ever be allowed to even collect a dime of SS money that didn't pay into the system are the minor children of an American citizen that paid into the system and died before collecting any retirement money from it. They should be allowed to draw their parents SS money until they turn 18. If you are unlucky enough to be the child of illegal aliens that was born here,too bad for you. You don't get a dime.
Even Bob Beckel agrees with this. The cowardly politicians in both parties won't lift a finger because old people vote.
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