AP's Liz Sidoti gets it wrong AGAIN, this time on Social Security (kovie)
In an AP piece today, she made the following seemingly alarming assertion about Obama's alleged stance on Social Security:

He said he would reinstitute a pay-as-you-go rule that calls for spending reductions to match increases and would shun what he said were the past few years' "casual dishonesty of hiding irresponsible spending with clever accounting tricks." He called the long-term solvency of Social Security "the single most pressing fiscal challenge we face by far" and said reforming health care, including burgeoning entitlement programs, was a huge priority.

Well, not exactly.

In fact, not at ALL, because this is what Obama ACTUALLY said today:

Now, I want to be very clear:  While we are making important progress towards fiscal responsibility this year in this budget, this is just the beginning.  In the coming years, we'll be forced to make more tough choices and do much more to address our long-term challenges, from the rising cost of health care that Peter described, which is the single most pressing fiscal challenge we face by far, to the long-term solvency of Social Security.

By misreading his words, whether willfully or lazily, she completely inverted what he said, which was clearly that "the rising cost of health care" was in fact what he viewed as "the single most pressing fiscal challenge we face by far", and NOT "the long-term solvency of Social Security". You'd really have to be massively dense, a very poor or perhaps sleep-deprived reader, or intentionally dishonest, to misconstrue what he said to mean that "the long-term solvency of Social Security" was "the single most pressing fiscal challenge we face by far".

And we wonder why the media still refers to Social Security as being "near broke" and "in crisis". Of course, it didn't help that Obama himself repeated and thus reinforced such memes during the campaign. THIS is what happens when you parrot dishonest RW talking points in order to curry faux bipartisan favor with the Broderites and avoid a real fight. At least he finally appears to get it.

I think.

There is a reason ..
she is called "Sprinkles" ... sounds like she needs a hit of sugar

Donut
As in "Do Not" Know Nuthin'.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton

[ Parent ]
So Sidoti got it mixed up
I'm not worried about Sidoti's mixups on SS -- no doubt she'll correct it.

I'm worried about Obama's mixups on SS, which never seem to go away.

I have to say that there is something so completely dishonest about Obama continuing to insist that there some problem with SS that we must attend to in just a few years (obviously, during his term).

When Orzag says that the accounting deficit presented by SS won't come about for 75-100 years, and he is advising Obama on the matter, how do you come to the opinion that it must soon be dealt with honestly? How is there not some ulterior motive, some hidden agenda that must lie behind such an absurd, groundless position?


In a perfect world
in which all major and even minor problems have been solved, then it MIGHT make sense to address this POTENTIAL very LONG-TERM problem with some VERY modest "fixes". But as it stands, and attempt to "fix" it has got to be based on either sheer idiocy, political cowardice, or undisclosed malice.

It's sort of like Iraq. Hussein was a fairly minor and fairly containable problem who might have SOMEDAY become a real problem, while the real problem was in Afghanistan and Pakistan. And yet we chose to "fix" the phony problem, and look where that's gotten us. The same combination of idiocy, bad ideology and malfeasance is now behind "fixing" social security. It's the SAME EXACT dynamic. And Obama needs to put an end to it NOW.

I disagree on Sidoti, though, as she's been doing this regularly. She's either a total idiot or willfully dishonest. Or both. I say both.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton


[ Parent ]
I just now (since my post)
what may be an explanation, from a Gibbs press conference, in which he was asked by Helen Thomas, why fix SS now?

The exchange:

HELEN THOMAS: Why tinker with Social Security when it's solvent until 2040, there are other issues in front of us.

GIBBS: There are many issues in front of us, but we are not going to get ourselves onto a sustainable path of fiscal responsibility unless or until we address many of those issues. The president wants to...

HELEN: Why is it an issue?

GIBBS: I don't know the exact year, but there is an inflection point in the funding where the trust fund is, if we haven't already passed the line, we're soon to pass the line where what is going in and what is coming out no longer adds to that solvency of the trust fund and is no longer equal to each other.

HELEN: Some people just want to take from it. And there's great suffering going on now, so I don't see why you ought to...

GIBBS: Well Helen don't posit that what the President wants to do is institute great suffering. But understand that the way the program is structured, and although the solvency may go to 2040 or 2041, there I think is great concern that the number of people that are paying in, and the number of people -- what is paid in no longer equals what is is going out, therefore in order to get to some sustainable path to fiscal responsibility the President understands that some hard choices are going to be made.

I think the obvious takeaway is this: Obama sees the problem being that, in a few years (the inflection point), SS will not be paying more into the general fund than it is taking out, but instead must start to draw down on some of its supposedly "saved" surplus, and that cannot be tolerated. What will have happened to all the surplus that SS has supposedly been packing away? Apparently, it will not be honored by Obama, if he has his way. SS can only be looted, it can never be paid back -- it's a one way street. The "fix" is to keep this looting arrangement intact, so that it can pay down other expenses.


[ Parent ]
Well, I think that you're being a bit presumptive
by assuming that this is what Obama would like to do with SS, i.e. cut benefits, raise the retirement age, raise the payroll cap, or some combination of these or other "fixes", to effectively never have to pay back much of the SSTF, and thus effectively default on them. No doubt there are many would who like to and have been trying to do this, but to say that this is what Obama wants to do is speculative.

And that's the thing about Obama, that no one really knows, or can know for sure, just what he wants to intends to do--including him, I suspect--so claiming that he intends to do this or that without definitive proof is, I think, unwarranted. But suspecting that it might be what he wants or intends to do is certainly warranted, as are preemptive actions taken to hopefully dissuade him from doing such things, if in fact they're what he wants or intends to do.

One troubling aspect to all this is that all this talk about SS being in crisis, and running out of money in 30 years, which Gibbs is clearly buying into here, is such nonsense that is easily disproven by spending 2-3 minutes reading any of a number of Krugman op-eds or Baker articles. Because the current SS system was by design and expectation supposed to experience an inflection point--several, in fact.

First, the one happening right now, as the differential between payroll tax revenues and benefits paid, which had been growing for the past two decades during the peak of the boomer earning years, starts to decrease--as expected 20 years ago, when this was set up--due to boomers starting to retire, and fewer workers entering the work force.

Second, the one that will happen in 8-10 years, as this revenue-benefits differential continues to decrease down to zero, and then enters negative territory--again, as expected and designed 20 years ago--which will finally require drawing upon that fabled trust fund to pay out full benefits.

And third, the one that MIGHT happen in 30-40 years, when the trust fund is depleted, and benefits will have to be entirely paid by payroll tax revenues, which some projections say will only be at 70-80% of projected benefits. This is the inflection point to worry about, if it happens. Except, it may well never happen, and in all likelihood will not.

Because this projected inflection point rests upon the assumption that average economic growth and activity during this entire 30-40 year period will be flat if not stagnant, which is a rediculous assumption, and even if it comes true, we're going to have far greater problems that an underfunded SS program by then. It also assumes that there will always be more people drawing out than paying into SS from here on, or at least more going out than coming in, and that to the extent that there will be an ongoing shortfall, it will be impossible to fix in 10, 20, even 30 years.

Basically, the first two assumptions are very solid, but the last, critical one upon which ALL these "Social Security is in crisis and must be fixed", is hugely flawed and unreliable. And thus the people relying upon it are either misinformed, or dishonest.

I may not be an economist, but I took calculus in high school and aced it, and understand inflection points. I also read Krugman, Baker, Kuttner, Reich, Stieglitz, Grieder, etc., and have been observing politics long enough, to spot a massive snow job when I see one. And that's what this is. I can only hope that Gibbs is misinformed.

Obama, though, should know better, so I don't know what his thing is with "fixing" SS, except, perhaps--I hope--mistakenly believing that by paying lip service to one of the tired old mantras of the right and "responsible" center, while not intending to actually follow through with it, he could misdirect them into oblivion. Uh uh. To kill this, he has to kill it, pure and simple, and no engage in fancy jiu-jitsu-like maneuvers. And he appears to get this at last, as he's backing off his "reform SS" thing, so let's hope that he gives up on it.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton


[ Parent ]
The only "presumption" I'm making here
regarding Obama is that his spokesperson, Gibbs, is accurately representing Obama's own concerns.

Gibbs identifies the inflection point of concern. He explains why it is a concern. I am merely pointing out that that inflection point can only be a concern if the intent is to refuse to honor obligations to pay back the surplus SS has been generating for these many years -- essentially to treat that money as stolen rather than borrowed. The logic here is pretty inescapable.


[ Parent ]
Let me be blunt
Frankly0's original premise is flat wrong.

The last definitive statement from the Obama camp came from Jason Furman, at that point the top economics guy on Obama's team. Furman said they proposed to delay the implementation of a cap increase to 2019, which date is not in Obama's current term or even in the next one should that happen. On the other hand 2019 is in fact right at the point at which CBO places that inflection point (as opposed to SSA who put it at 2017).

I don't know about 'presumption' or 'inescapable logic' but frankly frankly0 kind of failed 'fact checking' here.


[ Parent ]
And to the extent that raising the cap
might be necessary and make sense, it wouldn't be until one, we were surer than we are or can be right now that the trust fund will eventually run out AND that payroll taxes will not be sufficient to cover benefits paid when it does, two, we had a better sense of when that would happen, and three, we will have begun to draw upon the trust fund to cover benefits paid.

And that's not likely to happen for another 8-10 years even if we do nothing to change social security in the interim. And until then, it's pointless to raise the cap or do anything else to try to "fix" social security--unless we decide that we want to increase benefits paid, and from what I've read, that's never been on the table--because there's nothing to "fix".

Which is frustrating, because whenever one says that, a bunch of people chime in and say "But it's broken and going bankrupt!", with nothing to back it up but the disinformation that they've heard on CNN and MTP. And when you state that what they've been hearing is wrong, they treat you like you're crazy, because "why would they lie?". At which point, you just look at them with pity and frustration, because they're still being snowed and don't have a clue that they are.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton


[ Parent ]
Inescapable?
The only inescapable thing here is that Gibbs is parrotting RW talking points about SS facing a solvency problem down the line and that Obama is letting him, but without either of them giving any indication of what, if anything, they intend to do about it. It's unfortunate, I think, that they'd do this, but it doesn't mean that they therefore intend to cut SS benefits, raise the retirement age, or even raise the payroll cap (which is actually the only "solution" that they've ever proposed, back during the campaign, but which they don't talk about anymore).

He also talked a lot about bipartisanship, and there was certainly some attempts at it at first, but he now appears to be drawing back from that and focusing on getting what he wants done, with or without GOP votes. I'm guessing that that's what he intends to so with SS, and that all this talking about "fixing" it will end up having been just that, talk. I still think that it was a pointless and stupid thing to do, as it weakened his hand and handed points to the other side, but if in the end he doesn't try any "fixes", I'll be ok with that.

Sooner or later, one hopes, they'll realize that there's no point, and probably never was a point, in accepting RW premises about all sorts of issues in the vain hope that doing so might soften them a bit. These people don't care about words, or half-measures. They want their policies implemented, in full, and will not budge on anything halfway there. So I say screw them, stop indulging them by parroting their talking points even if you don't intend to implement them, and just say what you really want to do, and then do it, and pretend that they don't exist--which, effectively, they don't.

The selection of Gary Locke for commerce indicates that Obama now gets that. And today's 80-17 vote to confirm Solis indicates that even the GOP is beginning to get that. So I think that we might be going through a different, political kind of inflection point right now, as Obama sloughs off his first month's attempt at bipartisanship and shifts into genuine presidential mode at last. Now if only he starts doing right on national security issues...

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton


[ Parent ]
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