This is My Political Diatribe For Today

FOREWORD

Every time I hear politicians talk about reducing government spending, the next word I hear is “entitlements”, Social Security and Medicare. Social Security is the only retirement many of our nation’s lower income citizens have and since people are living longer and healthier lives, politicians think that changing the age of eligibility to 70 is the right way to solve the problem. Rising the retirement age to 70 will cause many to have less than cat food to eat. The fact that people are living longer and healthier does not mean they will be able to keep a job or find another job if replaced by a younger person. There may be a few who have jobs past age 65 but I doubt if many of them are in the lower income bracket. This sounds more like a “from the bottom up” effort in finding places to cut back government spending. 

I have been thinking more about a “from the top down” spending cut. We pay our congressional representatives and senators $174,000 each per year. The majority and minority leaders are paid $193,400 and the speaker of the house, $223,500. That is just their salaries. They also have an allowance. In 2008, the most recent year I could find, they received allowances ranging from $1,299,292 to $1,637,766 for office space, secretaries and aides, and mail. Consider that we have 100 senators and 435 congressional representatives plus their expense accounts; we are looking at roughly another $500 million. Then there is those travel allowances. The congressional travel budget is combined into a larger budget involving the State Department and Military travel. It is never made public. When a representative travels, he can pocket as much as $3,000 per trip in per diem (that is latin for by day) for food and lodging and due to an accounting system that does not require itemization nor demand return of unused cash. Some lawmakers can pocket up to $3,000 a trip in cash.

However, all this generosity did not start with this year's crop. Benefits payments for some 400 retired members of Congress, who receive an average benefit of $45,000 a year, cost taxpayers about $20 million annually, says the National Tax Payers Foundation. Future costs depend on the turnover rate: The more that leave before they reach the five-year vesting threshold, the lower the annual payouts required. Over time, congressional pensions are expected to accumulate more modestly as fewer members stay on beyond six to 12 years, according to the NTUF.

PART I 

The Social Security Act was signed by FDR (that is Franklin Delano Roosevelt to you uninformed about who the presidents were), on August 14, 1935. SSI withholdings were collected for the first time in January 1937 and the first one-time, lump-sum payments were made that same month. Regular ongoing monthly benefits started in January 1940.

A History Lesson on Your Social Security Card Just in case some of you young whippersnappers (& some older ones too) did not know this. It is easy to check out, if you do not believe it. Be sure and show it to your family and friends. They need a little history lesson on what is what and it does not matter whether you are Democrat or Republican. Facts are Facts. Social Security Cards up until the 1980s expressly stated the number and card were not to be used for identification purposes. Since nearly everyone in the United States now has a number, it became convenient to use it anyway and the message, NOT FOR IDENTIFICATION, was removed. Franklin Roosevelt, a Democrat, introduced the Social Security (FICA) Program. He promised:

(1.) That participation in the Program would be voluntary. It is no longer voluntary.

(2.) That the participants would only have to pay 1% of the first $1,400 of their annual Incomes into the Program; now they have to pay 7.65% on the first $90,000. 

3.) That the money the participants elected to put into the Program would be deductible from their income for tax purposes each year. They are no longer tax deductible.

(4.) That the money the participants 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. However, under president Lyndon Baines Johnson, the money was moved to The General Fund and Spent.

( 5.) That the annuity payments to the retirees would never be taxed as income. Under president Bill Clinton & vice president Al Gore, up to 85% of your Social Security can be taxed, Since many have paid into FICA for years and are now receiving a Social Security check every month—then finding that participants are getting taxed on 85% of the money they paid to the Federal government to ‘put away’. You may be interested in the following:

Q: Which Political Party took Social Security from the independent 'Trust Fund' and put it into the general fund so that Congress could spend it?

A: It was Lyndon Johnson and the democratically controlled House and Senate.

Q: Which Political Party eliminated the income tax deduction for Social Security (FICA) withholding?

A: The Democratic Party

Q: Which Political Party started taxing Social Security annuities?

A: The Democratic Party, with Al Gore casting the ‘tie-breaking’ vote as President of the Senate as Vice President of the US.

Q: Which Political Party decided to start giving annuity payments to illegal immigrants?

A: MY FAVORITE: That is right! Jimmy Carter and the Democratic Party. Illegal immigrants moved into this country, and at age 65, began to receive Social Security payments! The Democratic Party gave these payments to them, even though they never paid a dime into it! Then, after violating the original contract (FICA), the Democrats turn around and tell you that the Republicans want to take your Social Security away! In addition, the worst part about it is uninformed citizens believe it! If enough people receive this, maybe a seed of awareness will be planted and maybe changes will evolve. Maybe not, some Democrats are very sure of what is not so. Nevertheless, it is worth a try. Actions speak louder than bumper stickers.

PART II

I have long been angered by politicians and news media calling Social Security and Medicaid entitlements as though it is a FREE GIFT from the government. Since 1937, American citizens have been involuntarily paying a percentage of their income, now up to 7%, matched by their employer, into a fund set up to provide for people who manage to live past the age of 65 years, or in some cases younger. They are to the point of insolvency and are considering raising the age. Yet, politicians such as Senate Majority Leader Harry Reid, a democrat, will stand and tell lies to mislead taxpaying citizens. Following are some of Reid’s mis-speakings I found recently in a news blog.

In my previous, First History Lesson on Social Security, I presented some harsh evidence and truth on the matter. Read the following lies the democratic Majority Leader had to say about the matter. Do you think he is lying again?

Senate Majority Leader Harry Reid, Democrat from Nevada on disputed warnings that Social Security is headed for bankruptcy, called those assertions an “outright lie.” In addition, he says the huge federal entitlement program has not added “one penny” to the federal deficit.

Both of Reid’s claims are misleading. Reid made the comments at a “Back off Social Security” rally at the Capitol. Reid was joined by other Senate Democrats and liberal activists, who accuse Republicans of plotting to privatize Social Security. Democrats have used similar tactics in the past to scare senior citizens, who vote in large numbers.

“Social Security has not contributed one penny to the debt or the deficit ever in its 75 years,” Reid said at the event.

The claim is false. According to the actuaries for Social Security and Medicare, the Social Security program ran a deficit of approximately $41 billion, excluding interest on the bonds in the Social Security trust fund. Those bonds, which are a special type of Treasury bond, are placed in the trust funds in place of the cash surpluses the government has taken in from payroll taxes.

Because there is no cash in the Social Security trust funds, any deficits the program runs, including the 2010 deficit—and those projected into the future—must be repaid from current tax revenue.

Since the federal government was already running a deficit in 2010, and ran one in 2009, the money required to pay the Social Security deficit would have had to be borrowed, meaning it was added to the deficit and the national debt, contrary to Senator Reid’s claim.

Reid also rejected warnings that Social Security is going bankrupt, saying that the New Deal-era entitlement program was in sound fiscal shape.

“We hear pundits and politicians take the bait that’s been thrown to them by these Republicans over the last few decades,” Reid said. “You throw it to them, and they grab it. They grab it, and they claim Social Security is headed for bankruptcy. It’s not just an exaggeration that Social Security is headed for bankruptcy—it is an outright lie.”

This statement is misleading. According to the Social Security actuaries, the program will no longer be able to pay out full benefits beginning in 2037, at which time it will have exhausted both its dedicated tax revenue and the value of the interest from the government bonds in its trust funds.

“The annual deficits will be made up by redeeming trust fund assets in amounts less than interest earnings through 2024, and then by redeeming trust fund assets until reserves are exhausted in 2037,” the actuary reported in August 2010.

What this means is that Social Security will begin using income tax revenue to make up the difference as it runs continual deficits from now until 2037. In 2037, the program will have completely exhausted the Treasury bonds in its trust funds meaning it will not be able to take any more extra tax revenue. At that point, the income from the program’s dedicated payroll taxes will only be able to pay approximately 75 percent of promised benefits.

This statement is misleading because if Social Security were a private-sector pension, the federal government itself would consider it insolvent or bankrupt.

According to the Pension Benefit Guarantee Corporation—the federal entity that manages and bails out bankrupt or defunct pension plans—a pension must be taken over if it is insolvent and does not have enough money to pay out current benefits, or if it will go bankrupt.

“PBGC must terminate a plan if assets are unavailable to pay benefits currently due,” the agency states on its website.

In other words, Social Security is heading towards a level of insolvency that the federal government itself considers to be of such danger to its beneficiaries that—were it a private pension—the government would step in, take it over, and bail it out.

NOTE: When FDR established SSI (Social Security Insurance) in 1937 it was understood by most, that it would be a separate fund managed by the government and it would not be dipped into to pay for America’s overspending appetite. In other words, it would be used only for the purpose it was intended.

HAS IT? There has been more abuse and vote buying with this fund that can be understood or even completely discovered by the average American. People drawing disability who are not disabled, illegal immigrants drawing SSI (and welfare/food stamps) who did not pay into it nor even deserve it. If the SSI funds had been used as intended . . . as promised years ago . . . there would still be plenty of money go to around.

If the federal government really wants to cut the budget, they should look in their own back yard. Their high salaries and office budgets, their travel allowances and other perks they receive from lobbyists. In addition, billions in foreign aide to our so-called Allies.