What Vice President Joe Biden said today was, to use his now-famous phrase, "a big effin' deal." No, we're not talking about his "chains" comment which, as usual, has fascinated a press corps obsessed with taking statements out of context and playing "gotcha" games. We're referring to the comments he made about Social Security in a Virginia coffee shop.
From a press corps pool report, as relayed by NBC News:
"Hey, by the way, let's talk about Social Security," Biden said after a diner at The Coffee Break Cafe in Stuart, Va., expressed his relief that the Obama campaign wasn't talking about changing the popular entitlement program. "Number one, I guarantee you, flat guarantee you, there will be no changes in Social Security," Biden said, per a pool report.As if that weren't enough, Biden said it one more time:
"I flat guarantee you."
What does it mean when those words come from the Vice President of an Administration that's been talking for years about a deal to cut Social Security? A lot.
Could the Vice President have been "off the reservation," as the saying goes, speaking unscripted words that don't have the White House's full backing? Possibly, but it seems unlikely. These words sound like they were pretty well thought out: "Hey, by the way, let's talk about Social Security."
And the Vice President said "I guarantee you" -- not once, not twice, but three times.
It's true that the President has spoken about making cuts to Social Security as part of a larger deal, even saying things like this (unwisely, in our opinion): " Okay, we'll make some modest adjustments that are phased in over a very long period of time. Most folks don't notice 'em."
We criticized him for those words then, and if he repeats them we'll criticize him again. But this is a sign that the White House's thinking may have shifted now that Paul Ryan's in the race. Not only has the Republican Party shown that its most intransigent wing is now in the ascendancy, making a post-election deal unlikely, but the Ryan nomination makes it easier to draw a clear distinction between the parties on Social Security and Medicare.
Ryan may be laying low on Social Security right now, but he's on record as supporting the unpopular plan to privatize it. Legislation he co-sponsored in 2005 would have allowed workers to divert up to 40 percent of their contributions into private accounts -- accounts that would have enriched Wall Street bankers and then would have been devastated by the financial crisis those bankers created in 2008.
Ryan's Social Security plan would have drained nearly five trillion dollars from the Social Security Trust Fund which Americans rely upon for future benefits, according to Social Security's Chief Actuary. It would have cut guaranteed benefits by nearly 40 percent when it was fully implemented. Ryan's bill would have funneled billions to Wall Street bankers - and this supposedly "fiscally serious" politician's plan would have forced the government to borrow $1.2 trillion which it wouldn't have been able to repay until 2083.
That makes this the perfect time for the Administration to describe a stark difference between its ticket and the GOP's: They'll cut your Social Security and we won't. They'll privatize it to make bankers rich off the public dime -- think of it as another bailout -- and we won't. They'll drive the nation deeper into hock to benefit their rich friends, and we won't.
And the White House can even add, as Vice President Biden did: We flat out guarantee it.
Why have the Vice President say it first? Remember, Vice President Biden also spoke out in support of gay marriage shortly before the President did. Part of the Number Two guy's job is to take some arrows for the boss. That gives the President's team the chance to see what works and doesn't work in the messaging before he speaks up.
To which we say: Great. If we're going to criticize the top guys when we disagree with them, we should have their back when they do something we support. Mr. Vice President, we've got your back on this one. Mr. President, we'll have yours too.
And they'll need it. There's a highly-funded, highly misinformed, highly misleading manufactured "consensus" in Washington around the idea that cuts in Social Security benefits need to be cut. They trade in a small but widely disseminated body of lies, and they're going to fight this with everything they've got.
The coffee was barely cold in that Virginia coffee shop when The Washington Post, which is Ground Zero for this dishonest cabal, went on the attack against the Vice President. The Post Editorial Board, which would have repeatedly been sued for journalistic malpractice if such a thing existed, even mendaciously repeated the often-disproven lie that Social Security is "going broke" when it attacked Mr. Biden.
Shame on them for lying.
"Is 'going broke' too strong?" the Post Editorial Board asks rhetorically. "Well, let's ask the experts -- the trustees of the Social Security Trust Fund... " The editorial then takes a lot of language out of context before stating the trustees' conclusion that Social Security's trust fund (which doesn't include the billions in revenue the plan collects each year) will "become exhausted and unable to pay scheduled benefits in full on a timely basis in 2033."
Let's ask that question again: Is "going broke" too strong?
"Broke": According to Merriam-Webster, it means "penniless."
"Broke": According to Cambridge Dictionaries it means "without money."
"Broke": According to MacMillan Dictionary it means "to have no money." And "go broke," according to MacMillan, means "to no longer have any money and be unable to pay what you owe."
The fund will continue to pay full benefits, with money in the bank, until 2033. It will pay most of those benefits -- 75 percent -- after that, because it will be collecting hundreds of billions of dollars each year in new revenue. Yet the Post says that it will be "penniless," will "have no money," will be "without money," or will be "unable to pay what it owes."
Liars.
Washington's lousy with insiders who are willing to peddle dreck like this. It would make sense for the White House's calculus to include letting Joe Biden take the heat for a while before the President makes his case.
Of course, as we've already said, Biden could simply be off-message. If so, the President's campaign is likely to incur real damage if his team tries to walk it back. But it seems more likely that this a prelude to comments from the President in which he'll explain how he has "evolved" on this issue.
That seems much more likely -- and much smarter. A firm stance in defense of Social Security -- and then Medicare -- could be spun off into a number of winning themes for the White House, such as:
A youth issue: All the DC insiders' plans to cut Social Security are designed to hurt young people the most. Defending Social Security for younger people is a great way to energize the demoralized and disillusioned young people who are graduated with record student debt into the worst job market in modern memory.
An issue for seniors: That should need no explanation.
A 99 percent/tax fairness issue: The best way to stabilize Social Security's finances is by lifting the payroll tax cap and a financial transactions tax, and therefore asking the wealthiest among us to help undo the harm they've caused through exploding wealth inequity and Wall Street gambling.
Of course, the White House could say all the right things about Social Security -- and then make that December deal and cut it anyway. But when candidates "flat out guarantees" something, that gives citizens a lot of leverage to pressure them with after the election.
Citizen action was able to stop the President from offering Social Security cuts in his 2010 State of the Union message. It can work again, especially if the White House makes a clear stance like this a central part of its campaign. Could there be a fight in December? Sure -- but this makes it much more likely that we could win that fight.
And enough talk about fighting. Let's have a swords-into-plowshares moment. Right now I'm givin' it up for Joe Biden and the Administration. Biden said the right thing, and he said it straight up, without weaseling or waffling. Keep on saying it, Mr. Vice President, and get the President and the rest of the team to join you. Everybody will win that way.
Say it is so, Joe, and we'll be right behind you.
Follow Richard (RJ) Eskow on Twitter: www.twitter.com/rjeskow
William K. Black: Saletan's Elegy for Paul Ryan's DOA Budget Fantasy
There is no trust fund.
The trust fund is an empty hole with a slip of paper lying on the bottom, saying "We owe you trillions, Luv, Government".
The cash flow is negative and there's nothing in the bank- that's broke. They can pay their commitments only so long as the rest of the government pays theirs... but look, they're going broke too! They only way the government keeps solvent, and by extension the only way SS keeps solvent, is by steadily increasing the debt limit!
SS has lent its money to the Feds. When you have to meet your lent out all your money, you have no money left. Now we know why the country has an economic crisis: This very basic fact is was entirely lost on Wall Street, and in DC. The Feds can't pay SS back without borrowing. When you cannot meet your obligations without incurring more debt, you are broke.
Tell me again, who's not broke?
The trust fund is an empty hole with a slip of paper lying on the bottom, saying "We owe you trillions, Luv, Government".
Those "slips of paper" are legal obligations of the United states government just like US Treasury instruments. Are you suggesting that the $11 trillion in Treasuries held by investors are worthless? A great many sophisticated investors disagree. Or are US government obligations worthless only when made to workers rather than the rentier class?
Social Security has been in deficit for three years now (tax receipts are not enough to pay for the benefits). Obama and Congress worsened this by suspending a portion of FICA taxes and by the administration adding over 3 million "disabled" unemployed workers to the SSI rolls.
The so called SS trust fund does not have a dime of cash and is instead made up of intra-governmental bonds where Congress spent a quarter century of SS tax surpluses and had the Treasury write SS IOUs.
SS is currently making up its tax receipt deficit by cashing in these intra-governmental bonds with the Treasury and the broke Treasury is borrowing money to pay SS.
The SS deficit will keep widening as the boomers retire.
Ryan and many others are offering a plan to bring SS back into a semblance of balance by moving back the retirement age in the future and change the cost of living adjustment from the increase in national income to the inflation rate.
Far from being radical, these reforms are unavoidable and long overdue. The alternative is to join Greece.
equivalent to a retroactive tax increase which would fall most heavily on middle and working class earners, who, because their income was below the payroll cap, paid the greater percentage of their wages to create the fund. this is the rich stealing from the poor! this is an outrage!
Can the Social Security Trust Funds remain solvent without making changes to the program?
In the annual Trustees Report, projections are made under three alternative sets of economic and demographic assumptions. Under one of these sets (labeled "Low Cost") the trust funds remain solvent for the next 75 years. Under the other two sets (the "Intermediate" and "High Cost"), the trust funds become depleted within the next 25 years. The intermediate assumptions reflect the Trustees' best estimate of future experience.
Some benefits could be paid even if the trust funds are depleted. For example, under the intermediate assumptions, annual income to the trust funds is projected to equal about three-quarters of program cost once the trust funds become depleted. If no legislation has been enacted to restore long-term solvency by that time, about three-quarters of scheduled benefits could be paid in each year.
The Trustees believe that extensive public discussion and analysis of the long-range financing problems of the Social Security program are essential in developing broad support for changes to restore the long-range balance of the program.
But Obama is himself 80% of the way there. His education plans--charters, pay for performance, testing testing testing--is 99% Repug. His health care approach is greatly right wing. His trade policy is open trade.
Obama is already a moderate Republican. If we want to avoid the extremists, we have to keep Obama.
After all, he was just like us and cared about the middle class because he wasn't pampered and hand fed like the rest of the DC elite. He fought for the middle class all his life.
So much to admire. A man for all seasons.
I worked for a very large Texas school district that did just that, forcing the teachers to pay into a retirement fund instead. This was terribly unfair to those of us who had worked in other states in which we did pay into SS, and who did not plan to continue working in Texas to retirement.
The retirement fund lost a third of the money that I had paid into it in 2008, just before I took my money out when leaving the state.
I'm now physically disabled, but, thanks to Texas, I haven't paid into SS enough to qualify for SSD. I would much prefer that my money had been paid into SS, and I feel that ALL employers should be required to pay into it. If they were, the fund might be healthier.
Employers never want to establish an independent pension fund as it creates a contingent liabilty that makes them responsible for the payouts no matter what may happen to the economy.
Liberals never heard of $16 trillion in debt, the annual debt service that is in the hundreds of billions of dollars, or the fact the social security and medicare are going to need medicare themselves.
Liberals want the easily manipulated to believe that the Democrats can ignore reality just like those unions and nothing has to change. Liberals want these voters to believe that the Republicans (the adults on this issue) are just mean-spirited ogres who want to "hurt" people by rescuing these programs-and America-through restructuring,
This all part of the liberal "We are superior and they are evil" fantasy.
Truth is, baggers like Ryan, who voted for EVERY big spending bill that cam e down the pike, only oppose spending when the investment is in the common good or the general welfare--not when it is billions to to pay off some big money interest.
debt service in 2011 was only 1.5% of GDP and is projected to rise to 3.3% in 2021, about the same as it was under the republican hero Ronald Reagan.
see http://www.cbo.gov/publication/21999, http://www.cepr.net/images/stories/blogs/interest-share_of_GDP_5165_image001.gif