Some Social Security Myths, Facts and Plans.

MYTHS AND MISINFORMATION ABOUT SOCIAL SECURITY

One Common Form of the Myths:

“Franklin Roosevelt introduced the Social Security (FICA) program. He promised:

1) That participation in the program would be completely voluntary; 
2) That the participants would only have to pay 1% of the first $1,400 of their annual incomes into the program; 
3) That the money the participants elected to put into the program would be deductible from their income for tax purposes each year; 
4) That the money the participants paid in would be put into the independent “Trust Fund,” rather than into the General operating fund, and therefore, would only be used to fund the Social Security Retirement program, and no other Government program.;
5) That the annuity payments to the retirees would never be taxed as income.”

Which political party decided to start giving annuity payments to immigrants?
A5. Neither immigrants nor anyone else is able to collect Social Security benefits without someone paying Social Security payroll taxes into the system. The conditions under which Social Security benefits are payable, and to whom, can be found in the pamphlets available on our website.

The question confuses the Supplemental Security Income (SSI) program with Social Security. SSI is a federal welfare program and no contributions, from immigrants or citizens or anyone else, is required for eligibility. Under certain conditions, immigrants can qualify for SSI benefits. The SSI program was an initiative of the Nixon Administration and was signed into law by President Nixon on October 30, 1972.

Social Security Basics

George W. Bush regrets not reforming Social Security

10/22/10

Former President George W. Bush said Thursday that his biggest failure in office was not reforming Social Security.

Speaking to a trade association in Chicago, Bush said that he “would like to be remembered as a guy who had a set of priorities and was willing to live by those priorities,”

The president aggressively pushed a plan in 2005 that would have allowed younger workers to invest part of their Social Security tax payment in private accounts that would make money off stocks, bonds and other investments. But his proposal never gained traction even in his own party, with Congress never bringing his plan to the floor for a vote.

The plan has haunted Republicans ever since. The financial crisis in 2008 cast a shadow of doubt over the proposal, since seniors’ savings tied to the stock market would have lost on average 40 percent of their value.

Obama: Plan’s Focus on Social Security Taxes

WASHINGTON — The centerpiece of President Obama’s job-creation plan, a proposal to further reduce Social Security taxes, is emblematic of a package of modest measures that some economists describe as helpful but not sufficient to lift the economy from its malaise.

 

In his speech on Thursday night, Mr. Obama asked Congress to cut the amount that workers must contribute toward Social Security benefits, extending an existing measure, and to reduce, for the first time, the matching payments that employers are required to make.

The cuts, which would deprive the government of about $240 billion in revenues next year, are the largest items in the president’s $447 billion job-creation plan, which includes payments to unemployed workers, incentives for companies that hire workers and increased federal spending on infrastructure. All of the measures will require the support of Congressional Republicans.  Cutting taxes is a time-honored strategy for stimulating growth.

 

Ryan’s controversial Social Security plan he doesn’t discuss

NEW YORK (CNNMoney) – Representative Paul Ryan has long wanted to let Americans invest part of their Social Security taxes in private investment accounts.

After legislation he co-sponsored in 2005 went nowhere, Ryan included a detailed plan to privatize Social Security in his budget proposal in 2010. Under that plan, he would allow workers to funnel an average of roughly 40% of their payroll taxes into personal retirement accounts.

Issue Social Security Mitt Romeny

This is nothing new, but a reader points out that Mitt Romney has explicitly endorsed raising the eligibility age for both Social Security and Medicare:

When it comes to Social Security, we will slowly raise the retirement age….We will gradually increase the Medicare eligibility age by one month each year.

The Social Security retirement age is already increasing by statute and will reach 67 in a few years. Apparently Romney wants it to go up to 69 or 70. The actual number he has in mind is unclear (surprise, surprise) but given that he plans to balance Social Security’s books solely by raising the retirement age and slowing the growth of benefits for “those with higher incomes,” I’d put my money on 70. Slowing benefit growth on high earners just doesn’t do enough to let you get away with anything less.

So there you have it. If you’re in your 30s or 40s, Mitt Romney thinks you should work until you’re 70.  More from MJ