May 15, 2015

Why Do They Even Bother?

     Social Security's Office of Chief Actuary is fighting back against an accusation that it has been too optimistic in its projections for the future of the Retirement and Survivors Trust Fund issuing two papers on the matter.
     The future is inherently unpredictable. Social Security's actuaries don't claim anything close to 100% accuracy. They give ranges. It's hardly their fault that everyone treats their midrange estimate as if it was gospel. How can anyone really expect that advances in human longevity will follow a predictable course? Who can reliably predict the future course of economic growth?
     The dispute is of no consequence anyway. No one would know about it except for right wing operatives spreading the word about an article in an obscure scholarly publication. Almost no one really cares. A difference of a year or two in the exhaustion date of the Trust Fund hardly matters since what really keeps Social Security going isn't a trust fund but the political will of the American people and that is unshaken.
     Republicans argue on the one hand that Social Security will fail because the Trust Fund isn't really real since it only contains U.S. government IOUs and on the other hand argue that Social Security will fail because the Trust Fund will eventually run out of money. These are contradictory arguments. If the Trust Fund isn't really real, what difference does its theoretical exhaustion date make? These arguments have been made for 80 years and have gotten Republicans nowhere. Why do they even bother?


Anonymous said...

They bother because it is a staggering sum of money that they cant use to make money. If privitazation would happen that huge amount of money would be infused into wallstreet, fees would be charged of every shape and color. With a prize so great they have to keep trying. It lotto for Scrooges.

Anonymous said...

They would like privatization, but that has the problem of making Social Security's finances much worse. So I think they want cuts to benefits. At some point, probably either the cost will have to be lowered or revenue will have to be increased. Increasing revenue, such as by increasing the cap or payroll tax, will have an immediate effect and so can be done at any time. But lowering the cost by cutting benefits, unless you want to do so for current and near retirees (which almost all politicians claim to want to avoid), will take many years to have a significant impact. So politicians wanting cuts have to argue that there is a crisis that must be addressed now. Waiting makes revenue increases the only feasible solution for at least most of the shortfall.