The number of workers taking federal disability insurance payments hit yet another record in July, increasing to 8,753,935 during the month from the previous record of 8,733,461 set in June, according to newly released data from the Social Security Administration.
The 8,753,935 workers who took federal disability insurance payments in July exceeded the population of 39 of the 50 states. Only 11 states—California, Texas, New York, Florida, Illinois, Pennsylvania, Ohio, Michigan, Georgia, North Carolina and New Jersey—had more people in them than the number of workers on the federal disability insurance rolls in July.
Virginia, the twelfth most-populous state, had 8,096,604 people in 2011, according to the latest Census Bureau estimate. That would make Virginia’s population about 657,331 less than the number of workers who took federal disability insurance payments in July.
Congress enacted legislation in 1956 to add federal disability insurance to the Social Security system. Over the decades, the number of Americans actually working has dramatically declined relative to the number claiming federal disability insurance payments.
By July 1967, there 74,520,000 Americans actually working and 1,145,663 workers taking disability payments. That made a ratio of 65 actual workers for each worker collecting disability. In July 1987, there were 112,634,000 people actually working and 2,759,852 people collecting disability—a ratio of about 41 actual workers to each worker collecting disability.
It has taken me a couple days to fully compose my thoughts on Wednesday's GOP debate on MSNBC. Like most, I was looking forward to seeing Rick Perry perform on stage for the first time. I like Rick Perry and would gladly support him, but he made two obvious blunders as far as I can see. One can be fixed, the other is his to own. I was and am still hoping that Governor Perry can improve himself as I am no great fan of Mitt Romney. While I prefer Rick Perry on the substance of the issues he failed to demonstrate a level of political acumen I believe is essential to success and to that end an ability to advance conservative principles. The video to watch is here:
As we all know,the part considered controversial is Governor Perry's "Doubling Down" on his labeling Social Security a "Ponzi Scheme". Rick Perry is substantively correct about the soundness regarding the financing of Social Security. He deserves credit for bringing the issue to public attention. It is a genuine profile in courage, given the historic demagoguery of liberals whenever the subject is raised. Members in both parties and across the ideological divide acknowledge the numbers don't add up for Social Security and it needs to be corrected. Reforming Social Security will be complex and require extraordinary political skills to get it done.
Rick Perry's insistence on describing it as a "Ponzi Scheme" is a near fatal if not fatal error in judgement both politically and as a matter of public policy. Rick Perry is not off base in his analogy. The current fiscal structure of Social Security has a parallel with a Ponzi Scheme. There is however a fundamental distinction. First and foremost a Ponzi Scheme is a criminal endeavor intent on defrauding its investors. By contrast Social Security is a fully transparent public program freely supported by the American people with their tax dollars for over seventy years. And it has been repeatedly endorsed with results at the ballot box. A free choice by definition is not the same as being victimized by a fraudulent scheme.
The other issue I have is the politics and policy implications of his statement. In the aftermath of the debate are we discussing the long term viability of Social Security as currently structured? NO! Instead, we are debating whether or not it's a Ponzi Scheme. Issues are often reduced to cliches or hyperbole by politicians and on most issues it is acceptable because most issues are transitory and have no long term relevance except in the moment. But Social Security is not the flavor of the week as issues go, it is a perennial issue that has been debated for generations and any modifications have long term ramifications for American society. On matters of such consequence Rick Perry was ill advised to use hyperbole to illustrate his point. Furthermore, it emboldens left wing demagogues who believe that raising taxes on everyone else is the proper remedy. If we are going to have a vast public debate on Social Security it must be on the merits.
The other portion of the exchange that bothers me is the one that can be fixed. On the morning of the debate, Karl Rove stated that it was "TOXIC" to call Social Security a Ponzi Scheme. Dick Cheney also declared it to be inaccurate. As conservatives we have had many issues with big government policies and excess spending during the Bush years, a fact that is all too often ignored. We tend to view the Karl Rove's of the GOP as "establishment", and therefore not purely conservative, more interested in power than governing on principle. This is a valid criticism on many occasions, but I must point this out. Whatever one thinks of Rove or the "Bushies", we must have everybody on board in the effort to defeat Barack Obama. Don't let the numbers give you false hope. He can still win.
Rick Perry chose to "slap down" Rove and by inference could be accused of calling Cheney a liar in his response. Political junkies might find it entertaining but it must be said that if Rick Perry is our nominee, he as is true of all such nominees is confronted with the William Wallace moment from "Braveheart". Near the end of the movie, Wallace has been beaten, he's on the run and he agrees to a meeting, a meeting that leads to his betrayal and execution. He turns to his friends and says "We need the nobles". He was right. Fortunately this is 21st Century America and not 14th Century Scotland, but my point is that we will need the Karl Rove's committed in this fight, otherwise he'll spend the money elsewhere and we're going to NEED THE MONEY.
When Karl Rove said it was "Toxic" prior to the debate, he was giving Perry political advice disguised as analysis. Perry misinterpreted the remarks and was critical in kind. Rove is correct on the politics. Perry is wrong. Perry could have used his ill advised remarks in his book as an impetus to debate the genuine flaws in Social Security and walked back his talk of "Ponzi Scheme" at the same time. He could have suggested his remarks were intended to shine a spotlight on the the present state of the entitlement. Had he said anything to that effect we would be debating the formula for Social Security as opposed to the politics of Ponzi Scheme labeling.
In taking a shot at Rove he perpetuated another underlying narrative. It is quite evident that talk of a feud between the Perry and Bush people is very real. And in this respect Perry again dropped the ball. Prior to the debate, anyone affiliated with the Bush Administration have repeatedly been quizzed about this "feud". Dana Perino was pressed hard by Megyn Kelly, but only had nice things to say about Perry. JEB BUSH on "HANNITY", also debunked the notion of a feud. Dick Cheney and Karl Rove have both denied there was a rift. The Bush supporters, recognizing the real possibility of Perry as GOP standard bearer were clearly not being forthright, but towed the line rather than undermine Perry publicly as the potential nominee. Did Perry or his people not notice this? Do you think contributors to Bush didn't notice? The Bush supporters and the former President himself understand the politics of the nominee distancing themselves from Bush. They won't take it personally. In fact they have been extending olive branches. If Rick Perry is the nominee, he's going to want the former Bush contributors on his side. Whatever his problems with the "Bushies", this is the big leagues man, swallow your pride and play ball, because we all need to get with the program. The title of the program reads: "WE MUST DEFEAT BARACK OBAMA". Anything else is unacceptable.
I want to support Governor Perry and I would be quite annoyed if Romney is the nominee, but how can we defeat Barack Obama if we insist on alienating important people necessary to the cause of victory? The next debate is on CNN on Monday. I hope Perry is better prepared, because I WANT to support him because he is correct on the substance and in concert with my core beliefs and principles. But political skill and temperment are essential qualities in a candidate and as President. For quite a while it has been suggested that Perry is the perfect nominee because he unites every faction of the party. His debate performance has put the lie to that expectation. He has the correct principles, but his presentation is hurting the cause.
Social Security and Medicare Trustees Friday issued their annual report on the financial future of the two entitlement programs. The prognosis isn’t good, and, in fact, is even worse than was reported just one year ago.
According to the report, Social Security is now permanently cash negative and can no longer be funded solely from the payroll tax. It is projected to exhaust funds in 2036 — one year earlier than the report predicted last year.
Medicare isn’t faring any better. The trustees expect the fund to run out of money in 2024, and not 2029 as was previously expected. For the sixth year in a row, the trustees also, made an “excess general revenue Medicare funding” determination.
It only requires two consecutive determinations before the president is required to submit a legislative proposal to deal with the funding crisis within 15 day of his next budget.
“Today’s news that Social Security and Medicare will become insolvent even sooner than expected is a sobering wake up call and makes clear we must take action now to avoid catastrophe. Washington has no excuse. We have known for years this was coming.”
In a classic episode of The Simpsons, a hungry Homer Simpson runs out of donuts and breaks into his emergency stash. But when he opens the box, it’s empty except for a note that reads: “Dear Homer, IOU one emergency donut. Signed, Homer.” Homer curses his earlier self: “Bastard! He’s always one step ahead.”
It’s easy to laugh at Homer Simpson’s folly, but America is doing the same thing with Social Security financing, and the end result won’t be amusing.
In a recent Washington Post column, Charles Krauthammer described the federal government’s accounting shell game behind the fictional “Social Security trust fund.” He notes — and Obama administration officials acknowledge — that the federal government has already spent the Social Security surpluses of the last decades, replacing the borrowed money with so-called “special issue” bonds. But according to the Office of Management and Budget (OMB), these “special issue” bonds “do not consist of real economic assets that can be drawn down in the future to fund benefits.” Instead, they are mere promises to repay the borrowed money, just as Homer Simpson’s IOU is a mere promise to someday replace the borrowed donut. These “special issue” bonds are thus no more tangible assets than Homer Simpson’s IOU is edible.
To make matters worse, now that the Baby Boomers have started retiring, Social Security will no longer run surpluses but rather ever-increasing deficits, rising from $40 billion in 2011 to over $100 billion in 2021. As Investor’s Business Daily notes, these Social Security deficits will drain precious capital from the private sector that could have been used for productive investments — making the value of the “trust fund” less than zero.
But more fundamentally, not only is Social Security economically bankrupt, it is also morally bankrupt.
Contrary to popular belief, Social Security is not a savings plan where people deposit their money during their working years then withdraw it once they retire. Rather, as Robert Samuelson recently described, it is a “pay as you go” scheme. Current workers are taxed to pay current retirees. When these workers retire, they’ll then receive money taken forcibly from future workers. Hence, Social Security is no different than any other Ponzi scheme, except that Americans are compelled to join whether they wish to or not.
Individuals are legitimately entitled to retire with their own savings or from money contractually owed them via insurance, private pensions, or other voluntary retirement plans. Individuals have both the right — and the responsibility — to plan for their retirements according to their own best judgment. This includes saving money as well as purchasing insurance (or entering into voluntary mutual assistance agreements with others) to protect themselves against unforeseen adverse circumstances that might prevent them from saving for the future.
But they do not have the right to confiscate other workers’ earnings to fund their retirements. The fact that current workers have already been taxed to pay earlier retirees does not give them the right to confiscate future workers’ incomes, just as someone who had been physically abused by his parents does not somehow gain the “right” to abuse his children in turn.
