OBOF TYMHM & MORE PART 21

WELCOME TO OPINIONS  BASED  ON FACTS (OBOF)

&

THINGS YOU MAY HAVE MISSED (TYMHM)

YEAR THREE

 

Name	Published
OVERVIEW
OBOF & TYMHM PART 14	Dec  18, 2012
OBOF & TYMHM PART 15	Jan.  02, 2013
OBOF & TYMHM PART 16	Jan.  08, 2013
OBOF & TYMHM PART 16 EXTRA	Jan.  11, 2013
OBOF & TYMHM PART 17	Jan.  15, 2013
OBOF & TYMHM PART 18	Jan.  22, 2013
OBOF & TYMHM PART 19	Jan.  29, 2013
OBOF & TYMHM PART 20	Feb.  05, 2013
OBOF & TYMHM PART 21	Feb.  14, 2013

 

 

IN THIS ISSUE

 

1.  Regularity needed.

2.  Social Security crisis solved with facts.

3.  State of the Union address - gun control.

4.   Seven reason to focus on Jobs instead of deficit.

 

REGULARITY IS NEEDED

Regularity of function or operation is one of the main keys to success.  I know this and, yet, I am quite irregular with my postings.  It truly bothers me that I can't seem to get my posting out on time on Tuesdays.  It's a physical and emotional problem that I have now at 88.  That's not an excuse, it's just the way it is.  Most of the time, I can make it and will keep trying hard to warrant your reading.

I want to thank all of you who have stuck with me.  You make it worthwhile  I particularly want to thank those of you in the following countries who seem to hit every week:  Russia, Germany, United Kingdom, South Korea, Sweden, France, and Vietnam.

~~~

So-Called Social Security ‘Crisis’

Solved With Facts

February 6th, 2013

  Jason Sattler

 

NOTE:  From Floyd

Parts of the following article are true, but it only tells part of the truth.  Therefore, as you read, you will see the type turn to black in some places.  When it does, that is my writing, trying to provide the full truth that you really need.

If you’ve been following the debate over a so-called “grand bargain” to cut the long-term deficit, you may have been surprised to hear Social Security mentioned by both the GOP and the President, as if the program is part of what Republicans call our “spending problem.”  It isn’t.

“Under the law Social Security is not supposed to be part of the budget,” writes Dean Baker, an economist and the co-director of the Center for Economic and Policy Research.  “It is an entirely separate program financed on its own.”

And as a self-funded program, it has sufficient funds to pay full benefits, until 2033.  After that, it is funded to pay 75 percent of obligated benefits.

Basically, there isn’t a crisis now and won’t be for 20 years.

It is a self-funded program, BUT, the SS Trust Fund, which is suppose to hold the cushion money that will be needed when the Baby Boomer generation begins to collect SS has nothing in it, except Government IOUs.  The 1983 Social Security reform package provided for a large increase in the FICA payroll deduction.  That was suppose to build a surplus in a SS Trust Fund and was to draw interest, until the time it was needed, about 2018.  It was a good plan, BUT.  You have to watch out for those BUTs.

By 1987, the Trust Fund began to show a sizeable surplus.  President Reagan was in financial scraps and so, contrary to what was suppose to happen, he took the surplus and used it as though it were General Revenue funds. 

Every President and Congress since, 1987, has done the same thing.  The money was replaced with Special Government Bond.  They do not draw any interest and have no monetary value.  They are nothing more than IOUs.  The Trust Fund is empty, but that is what Mr. Satter is referring to when he says, there is "sufficient funds" to 2033 for SS benefits.  At present, these IOUs reflect almost $3 trillion that is listed as part of the National Debt. 

Due to the great recession and high unemployment, the Social Security program started to have a short fall in 2010.  The Government had to start paying back some of the money, that had been stolen from the Trust Fund.  That will have to continue from now on.  The only way this debit to SS can be voided, except by paying the money back, is by Congressional action. 

There is a large percent of Federal Legislators, who do not know these facts.  Therefore, they are saying that SS adds to deficit when, actually SS does not and never has contributed to the deficit.

The first sentence of the next paragraph of the article is certainly true, but not about the reason he refers to.

  The problem is, not enough Americans seem to know this.  But a new study from the National Academy of Social Insurance (PDF) shows that when citizens are informed about the realities of Social Security, they’re comforted and willing to make changes to make the program solvent into the future.

A majority initially responded that Social Security was in “crisis.”  But once informed of the slight increase in payroll taxes needed to save the program, 3 out of 4 said there is no crisis.

And while 82 percent of Americans are willing to pay higher taxes to save Social Security, there is, of course, an even more popular alternative.

A remarkable 87 percent of those surveyed are in favor of taxing the wealthy at a higher rate in order to save the earned benefit that has dramatically reduced poverty among senior citizens.

Currently, there is a $110,100 cap on Social Security taxes, meaning no matter how much you earn, you only pay your 6.2 percent payroll tax on the first $110,100.  The result is that working families, who often will depend on Social Security for retirement, pay a larger share of their income in payroll taxes. Paying this tax is still quite popular with the 80 percent who value the benefit for themselves.

You’ve probably heard of the “Chained CPI” proposal floated by the president and supported by some progressives, including The Center for American Progress.  This would slow the growth of the Social Security benefit, eventually cutting hundreds and then over $1,000 a year for the beneficiaries who need it the most.

This would not be a very popular policy choice.  A key finding of the NASI study is that “84 percent believe current Social Security benefits do not provide enough income for retirees, and 75 percent believe we should consider raising future Social Security benefits in order to provide a more secure retirement for working Americans.”  This would be the exact opposite of what the “Chained CPI” would do.

There is a misconception as to what Social Security was established for.  It was never intended to be a full retirement program.  It is suppose to be a supplemental payment.  Being a full retirement program would be nice, but the country can neither, afford it nor would Republicans ever allow that to happen.  

Raising the cap on taxed income over 10 years is the single most popular proposal to help fund the program fully for the foreseeable future.  This option is far more popular than, raising the retirement age to 67, another option that has been discussed in the “grand bargain.”

So if Social Security is so popular and so essential that 96 percent of current beneficiaries say it is important to their monthly income, why are cuts even being considered?

Well, it would save a lot of money – though not as much money as we could have saved by letting breaks on estate taxes for wealthy families end.

When he refers to saving money, he must be thinking about money from the General Revenue Fund.  If that is the case, it is simply steeling more money from SS, because the money that now has to be paid for SS from the General Revenue Fund is actually SS money.  They are simply making some payments toward the, almost, $3 trillion the Government owes SS.

Besides Medicare, which is nearly as popular as Social Security and actually a lot closer to “crisis,” there isn’t much to cut. Discretionary spending is at historic lows.  But the main issue is that Republicans have vowed on stacks of Bibles never to raise taxes — even if it’s a very popular choice and would save an essential part of our safety net in perpetuity.

As Americans realize when given the facts, Social Security isn’t in crisis.  The crisis is politicians clinging to intractable beliefs that force them to make cuts that almost no one wants to the programs Americans need the most.

Lets take a look at the first sentence of the above paragraph.  "As Americans realize when given the fact, Social Security isn't in crisis."  I don't think that Americans would feel that way at all, if they actually knew the facts, which are not set forth in this article.  I have tried to give you the actual facts, showing that SS is in a crisis state right now. 

There is no crisis as long as the Federal Government continues to make payments to SS for the money that has been borrowed (I am being polite here, by using the word borrowed.)  It actually has been out and out fraud every year since 1987.

Because, so many in the Congress are not aware that the Government owes SS this money, they claim that the money that has to be given now to SS does add to the deficit.  Actually, it does not add to the deficit, as I have said before.

~~~

STATE OF THE UNION ADDRESS

GUN CONTROL REFORM

The President is right. It's been more than two months, since the Newtown tragedy, and Congress has to act.  As the President said, "This is not the first time this country has debated how to reduce gun violence. But this time is different.  Overwhelming majorities of Americans – Americans who believe in the Second Amendment – have come together around common sense reform."

That’s why I’m calling on my Representative and Senators to work with President Obama and pass common sense gun safety policies. We need to end gun trafficking, crack down on the black market, expand background checks, reinstate the assault weapons ban and do away with high-capacity magazines.  This reform will in no way change the second Amendment.  No one is going to come to your home and take away your guns.  That is not what this is all about.  This is truly COMMON SENSE. 

These assault weapons and high-capacity magazines are not needed for hunting or target shooting.  They are designed specifically for killing people.  This reform that the President is asking for is truly common sense and leaves the second Amendment intact. 

These reforms will save lives, but only if we pass them.  Now is our moment.

Tell Congress: Pass President Obama’s gun proposals now and help save lives.

The President has once again made it clear that he is determined to see this through.

Our children are counting on us.  We can’t let them down.

Six things you should know and pass on about gun violence:

1. There are approximately 30,000 firearm-related homicides and suicides a year.

2. An estimated 6.6 million guns are transferred every year without a federal background check.

3. Twenty-two percent of 14- to 17-year-olds have witnessed a shooting in their lifetime.

4. 15 of the 25 worst mass shootings in the last 50 years took place in the United States.

5. Most polling shows the majority of Americans support an assault weapons ban.

6. 87 percent of gun owners and 74 percent of NRA members support requiring background checks for every gun sale. (Source: May 2012 survey conducted by Republican pollster Frank Luntz).
~~~

Seven Reasons Obama Should Focus on Jobs, Not the Deficit, During His State of the Union

Pat Garofalo

Think Progress / News Analysis

Published: Tuesday

Several commentators have posited that President Obama should focus on the federal deficit during tonight’s State of the Union address, explaining to America how he will rein in a supposedly out of control budget.  Obama should “spend the bulk of his time talking about the deficit,” wrote the Post’s Chris Cillizza.

 

“When President Obama delivers his State of the Union address Tuesday evening, here’s one thing you won’t hear: an ambitious new plan to rein in the national debt,” bemoaned the Washington Post’s Lori Montgomery.

But this is completely backwards. With unemployment stubbornly hovering around 8 percent, Obama’s focus should be on jobs and economic growth, not the deficit. Here are seven reasons why:

1. Deficits are shrinking. According to the latest projections from the Congressional Budget Office, over the last few years, $4.5 trillion in deficits have been reduced.  In August 2010, CBO’s “alternative fiscal scenario” projected a deficit in 2020 of 7.8 percent of GDP.  Now it projects that deficitwill be 4.7 percent of GDP.

 

2. The debt is all but stabilized. CBO noted that the debt is basically stabilized,peaking at 77.7 percent of GDP in 2014, then dropping to 73.1 percent in 2018 before rising slightly again in 2022.  According to the Economic Policy Institute, an additional $670 billion in deficit reduction is enough to fully stabilize the debt, which is less than half of the additional deficit reduction Obama has called for.

 

3. Spending growth is slow. House Minority Leader Nancy Pelosi (D-CA) said over the weekend that spending is not a problem, and the stabilizing debt and falling deficit show that she’s right.  Under Obama, spending is growing at its slowest rate since the Eisenhower administration. Tax revenue, meanwhile, hit lows not seen since World War II over the last few years.

 

4. The output gap is huge and job growth is slow.  As economist Adam Hersh noted, $900 billion more in economic activity is required to fill the “output gap,” the difference between what the economy is producing now and what it needs to produce to create full employment. CBO projects that the unemployment rate will not fall below 6 percent until 2018.  The U.S. still needs 3 million jobs just to make up for those lost during the Great Recession.

 

5. Austerity is killing the recovery. CBO anticipates that economic growth will be slow this year due to “fiscal tightening that has already begun or is scheduled to occur.”  European countries that have cut spending in an attempt to reduce their debts have, instead, quashed economic growth while their deficits barely moved (or expanded). Federal Reserve Vice Chair Janet Yellen yesterday blasted Congress for allowing fiscal policy to be a “headwind for the recovery.”

 

6. Infrastructure investment is collapsing.  Public investment has plunged since the Great Recession.  According to the American Society of Civil Engineers, America’s infrastructure deficit stands at $1.6 trillion and will grow to $2.75 trillion over the next decade, which will cost the country $3 trillion in wasted economic potential and 3.5 million jobs.

 

7. Borrowing rates are incredibly low.  The cost of borrowing for the U.S. has been low for years, plunging to record lows over the summer. This provides a golden opportunity for government to borrow money and create jobs while making valuable public investments.

 

 

~~~

If the good Lord is willing I'll talk with you again, hopefully, next Tuesday February 19, 2013.

God Bless you all

&

God Bless the United States of America.

Floyd