Social Security Crisis and Cato's 'Big Lie'
by Bruce Webb, Sun May 27, 2007 at 07:50:11 AM EDT
Social Security is not broke: by the Numbers That was the title to my Introduction when I put up by first series of posts on Social Security in November 2004. It holds up very well today. But for a new Introduction you might start with Guide to the BruceWeb
Social Security is not broke, even if taken on its own terms. It is fully funded until 2041, and even then if nothing was done the benefit cut would still leave a check 120% better than retirees get today. Everything else you hear about "looming Boomer retirement""phony IOUs""looted Trust Fund" is just part of a contrived narrative set forth in the Fall 1983 Cato Journal whose title is Social Security: Continuing Crisis or real reform
Most egregious of all the Cato Journal articles is Butler and Germanis Achieving a "Leninist" Strategy where they layout an elaborate campaign with four components.
One, get the stakeholders on board to sell a consistent message:
"What we must do is construct a coalition around the Ferrara plan, a coalition that will gain directly from its implementation. That coalition should consist of not only those who will reap benefits from the IRA-based private system Ferrara has proposed but also the banks, insurance companies, and other institutions that will gain from providing such plans to the public."
Two, reassure those approaching retirement
"Calming Existing Beneficiaries
The sine qua non of any successful Social Security reform strategy must he an assurance to those already retired or nearing retirement that their benefits will he paid in full."
Three, convince the young that there is an irreparable problem
"The second main element in our reform strategy involves what one might crudely call guerrilla warthre against both the current Social Security system and the coalition that supports it."
Four, blame the Boomers.
The whole thing is worth reading. This campaign was carried out brilliantly and maintains much of its strength today even though the facts stopped supporting it around 1998, and its falsity confirmed by 2000.
People who believe Social Security faces any kind of crisis are simply the victims of the Leninist guerilla war strategy outlined by Butler and Germanis in 1983. The Republicans and certain tools in the Democratic center are either lying to you or equally victims who have not bothered to actually examine the numbers.
Rather than draw this out I'll just see if anyone cares to respond.