Social Security 101

By karoli
from CrooksandLiars

I am writing this after seeing young progressives I respect parrot conservative lies told about Social Security. It appears that the press has done a bang-up job of NOT reporting the truth about Social Security and allowing specious conservative lies to take deep root. So deep that intelligent young liberals even believe the spew, not to mention conservatives who have a vested interest in believing and spreading it.

My career, pre-blogging, was as third-party administrator of employer-provided retirement plans. For years I was a certified practitioner, and I watched as private pensions were systematically dismantled, underfunded, and ultimately converted to 401k plans subject to the whims of the market and unsophisticated investors. While owners might -- MIGHT -- have retired with adequate funds, workers almost never did. The one single thing that every worker could always count on at retirement was (and is) Social Security.

Yet it seems that conservative lies have taken hold to the extent that the truth is called a lie, while lies are called the truth. Once upon a time, that only happened in fiction. Now it's real. So let's talk about Social Security, what it is, and why you shouldn't believe everything conservatives and their minions in the press tell you.

Lie #1: Baby Boomers Will Bankrupt Social Security

Baby Boomers were already planned for during the reforms undertaken under Ronald Reagan's administration. Here's a chart with the inflows and outflows of the trust fund since 1958. As you can see, there has been positive cash flow since adjustments were made to the assumptions, tax rates and SSRAs. Even in 2009, cash flow was positive, leaving a $2.5 trillion surplus in the fund.

(More here.)