Fake News: Why Social Security Isn't Going Broke
Fake News: Why Social Security Isn't Going Broke
One
of the ugliest tropes in American politics is to say “Social Security
is going broke.” Although there are structural funding problems with the
system, to say that the nation’s most successful annuity program is
going bust is a lie. It can be fixed and only politics blocks a
reasonable remedy.
But that didn’t stop dozens of Fox News outlets from proclaiming otherwise. They got their facts wrong and wanted to scare people without providing context.
Fox anchors read this statement: “The Social Security Board of Trustees said [in] its 2017 annual report that 2022 will make the first time in more than 40 years that Social Security pays out more in benefits than it takes in. And so deficits are going to continue to be depleted out of the roughly $3 trillion in asset reserves.”
Two parts of this report are false. 1) The Social Security trust fund
will not be depleted in 2022, as implied by this statement. 2) The
trust fund will remain solvent until 2034, not 2022. This is not my
math, it’s what the latest Social Security Trustees annual report states.
Although the Trustees’s report can get dense in detail, it lays out
projections. The deficit situation is based on current data on
retirements and the aging of the American population.
Congress can change the way Social Security is funded any time, so none of these numbers are written in stone. To date, though, only the Democrats have proposed solutions, although the GOP-led White House and Congress haven’t acted to fix the problem.
Those who want to undermine or deep-six Social Security spread the false message that it won’t be around, particularly for future generations. That’s been a strategy of those who want to destroy social insurance programs for decades. But it’s simply not true, since Social Security, Medicare and Medicaid are essential — and successful — in reducing poverty.
“Contrary to Fox’s fearmongering,” reports Media Matters, the media watchdog group, “there will be enough money to pay out full benefits for nearly two decades.”
“Beginning in 2034, as the trustees’ report notes (not 2022 as
the FOX segments claim) Social Security faces a problem of not having
enough revenue to pay out full benefits — but it can be addressed without cutting benefits by simply raising additional revenue.”
Medicare, however, has some serious short-term fiscal woes. The program’s hospital trust fund will be depleted by 2026, three years earlier than previously forecast.
The Trump/GOP tax law, passed late last year, will short the Medicare fund of tax revenue. And, as with Social Security, Baby Boomers are turning 65 at a rate of 10,000 a day, which is putting even more pressure on the social insurance programs.
Yet both Social Security and Medicare can be adequately funded by raising payroll taxes and making those taxes more progressive. Keep in mind that money goes into both trust funds from working people
Yes, future retirees, funding Social Security is a math problem that
can be fixed by forward-looking politicians. One simple solution is to
contribute more in payroll taxes — if you make more money.
Right now, the amount of wages subject (or assessed for) to Social Security payroll taxes is capped at $128,400. So if you’re making more than that, you’re not paying any more into the system, although arguably you can afford a bigger contribution.
This amount hasn’t kept up with those in the top income tiers. If you’re millionaire or billionaire, you won’t contribute any more to the universal retirement system because of this cap.
But adding fuel to the fire isn’t going to make America any younger, help more people save for retirement or even add more workers to pay into the system. It’s political bomb throwing. And it’s nothing new. Politicians and Social Security analysts have known about this problem for a generation.
“Fox is presenting the upcoming deficit in Social Security as a sudden crisis, but in fact it’s been anticipated for decades,” adds Media Matters. “The 1984 trustees’ report explained that `income will generally exceed outgo, developing a substantial surplus each year. ’”
In the interim, focus on saving not only for your own retirement, but
saving the safety net that will make your burden lighter. It’s a fight
worth waging.
Follow me on Twitter or LinkedIn. Check out my website or some of my other work here.
I speak and write about innovation, investor protection, employment, money management, economics, college financing, retirement and social issues. My latest book is
…
But that didn’t stop dozens of Fox News outlets from proclaiming otherwise. They got their facts wrong and wanted to scare people without providing context.
Fox anchors read this statement: “The Social Security Board of Trustees said [in] its 2017 annual report that 2022 will make the first time in more than 40 years that Social Security pays out more in benefits than it takes in. And so deficits are going to continue to be depleted out of the roughly $3 trillion in asset reserves.”
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Congress can change the way Social Security is funded any time, so none of these numbers are written in stone. To date, though, only the Democrats have proposed solutions, although the GOP-led White House and Congress haven’t acted to fix the problem.
Those who want to undermine or deep-six Social Security spread the false message that it won’t be around, particularly for future generations. That’s been a strategy of those who want to destroy social insurance programs for decades. But it’s simply not true, since Social Security, Medicare and Medicaid are essential — and successful — in reducing poverty.
“Contrary to Fox’s fearmongering,” reports Media Matters, the media watchdog group, “there will be enough money to pay out full benefits for nearly two decades.”
Medicare, however, has some serious short-term fiscal woes. The program’s hospital trust fund will be depleted by 2026, three years earlier than previously forecast.
The Trump/GOP tax law, passed late last year, will short the Medicare fund of tax revenue. And, as with Social Security, Baby Boomers are turning 65 at a rate of 10,000 a day, which is putting even more pressure on the social insurance programs.
Yet both Social Security and Medicare can be adequately funded by raising payroll taxes and making those taxes more progressive. Keep in mind that money goes into both trust funds from working people
Right now, the amount of wages subject (or assessed for) to Social Security payroll taxes is capped at $128,400. So if you’re making more than that, you’re not paying any more into the system, although arguably you can afford a bigger contribution.
This amount hasn’t kept up with those in the top income tiers. If you’re millionaire or billionaire, you won’t contribute any more to the universal retirement system because of this cap.
But adding fuel to the fire isn’t going to make America any younger, help more people save for retirement or even add more workers to pay into the system. It’s political bomb throwing. And it’s nothing new. Politicians and Social Security analysts have known about this problem for a generation.
“Fox is presenting the upcoming deficit in Social Security as a sudden crisis, but in fact it’s been anticipated for decades,” adds Media Matters. “The 1984 trustees’ report explained that `income will generally exceed outgo, developing a substantial surplus each year. ’”
Follow me on Twitter or LinkedIn. Check out my website or some of my other work here.
I speak and write about innovation, investor protection, employment, money management, economics, college financing, retirement and social issues. My latest book is
…
Throughout
the United States, businesses are looking for excellent entry-level
employees. An often-overlooked talent pool is Opportunity Youth - young
adults ages 16-24 who are out of work or without a college degree - but
who possess the 21st-century skills that employers need. There are more
than 4 million Opportunity Youth in
the U.S., who are eager to build a long-term career within an
organization. Businesses that successfully hire, train, and support
Opportunity Youth build an engaged corps of entry-level talent that are extremely loyal.
In order to engage and retain Opportunity Youth, supervisors must approach their work with their team a little differently than most managers do with entry-level employees. The most effective frontline managers of Opportunity Youth view themselves as a “coach” charged with helping team members grow rather than as a “boss” who simply tells people what to do. We call these leaders “Opportunity Managers” and they embrace the following four pillars of the Coaching Mindset.
1. Build a strong relationship with each team member: Employees respond well to managers who show that they genuinely know them and care about them. Managers who embody the coaching mindset build relationships with every team member by: conducting regular and effective 1-on-1 check-ins, finding areas of common interest, and through numerous positive interactions over time.
2. Focus on the growth and improvement of the team member over time: Managers who embody a coaching mindset focus on the employee’s growth and improvement over time and offer the employee opportunities to help the person grow. These managers know how to break down tasks into manageable chunks and help each employee take on increased responsibility (and complexity) over time.
3. Be patient, kind, and supportive of the employee: Supervisors who embody the coaching mindset are kind, approachable, and build trust with their team members. As a result, the team seeks out their guidance and support and are willing to go the extra mile for their manager.
4. Tailor coaching to the team member’s learning styles: Some employees learn by talking through an experience while others learn through doing something in a “hands on” fashion. Managers with a coaching mindset tailor their guidance to the learning preferences of each individual team member, thereby increasing the speed that they learn and apply new skills.
Opportunity Youth are an excellent and available source of talent for
entry-level roles. We want to help businesses access this talent pool
and help young adults pursue rewarding careers. A skilled manager builds
and shapes the culture and the performance of their team.
That is why we developed the Opportunity Manager Training, an online program made up of short and actionable modules, each designed to help frontline managers learn how to embrace the coaching mindset and implement effective coaching to drive strong performance for each and every young adult that they work with.
Take our free Frontline Talent Assessment and see how Grads of Life can help your organization improve the engagement, retention and performance of your entry-level employees.
In order to engage and retain Opportunity Youth, supervisors must approach their work with their team a little differently than most managers do with entry-level employees. The most effective frontline managers of Opportunity Youth view themselves as a “coach” charged with helping team members grow rather than as a “boss” who simply tells people what to do. We call these leaders “Opportunity Managers” and they embrace the following four pillars of the Coaching Mindset.
1. Build a strong relationship with each team member: Employees respond well to managers who show that they genuinely know them and care about them. Managers who embody the coaching mindset build relationships with every team member by: conducting regular and effective 1-on-1 check-ins, finding areas of common interest, and through numerous positive interactions over time.
2. Focus on the growth and improvement of the team member over time: Managers who embody a coaching mindset focus on the employee’s growth and improvement over time and offer the employee opportunities to help the person grow. These managers know how to break down tasks into manageable chunks and help each employee take on increased responsibility (and complexity) over time.
3. Be patient, kind, and supportive of the employee: Supervisors who embody the coaching mindset are kind, approachable, and build trust with their team members. As a result, the team seeks out their guidance and support and are willing to go the extra mile for their manager.
4. Tailor coaching to the team member’s learning styles: Some employees learn by talking through an experience while others learn through doing something in a “hands on” fashion. Managers with a coaching mindset tailor their guidance to the learning preferences of each individual team member, thereby increasing the speed that they learn and apply new skills.
That is why we developed the Opportunity Manager Training, an online program made up of short and actionable modules, each designed to help frontline managers learn how to embrace the coaching mindset and implement effective coaching to drive strong performance for each and every young adult that they work with.
Take our free Frontline Talent Assessment and see how Grads of Life can help your organization improve the engagement, retention and performance of your entry-level employees.
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