Las Vegas Sun

November 27, 2014

Currently: 63° — Complete forecast | Log in | Create an account

The Policy Racket

Nevada senators take opposing sides on Social Security

Image

Karoun Demirjian

Senate Majority Leader Harry Reid holds a press conference Thursday, Jan. 27, 2011, in Washington, D.C., speaking out against any measures to privatize or eliminate Social Security.

John Ensign

John Ensign

Senate Majority Leader Harry Reid delivered a chilly response Thursday to the growing chorus of Republican voices who have been calling for severe austerity measures in the face of a metastasizing debt crisis, among them, a privatization of Social Security.

“Simply said, it’s off the table,” Reid said at a press conference with Social Security recipients Thursday. “As long as I am majority leader, I will do everything within my legislative powers to prevent privatizing or eliminating Social Security.”

The push to privatize Social Security fell off the agenda after hitting a hard loss back in 2005. Despite strong support among the Republican majorities in the House, Senate, and the endorsement of then-Republican President George W. Bush, lawmakers weren’t able to get around fierce opposition from the Democratic minority to get it passed.

But it’s come back up on the agenda in the past weeks, and especially the past few days, as Congress has been delivered projection after projection showing the national debt spiralling out of control.

Republicans put up perhaps their biggest champion of privatizing Social Security, Rep. Paul Ryan of Wisconsin, to give the party’s official rebuttal to President Obama’s State of the Union speech on Tuesday, which focused chiefly on the subject of the economy.

House Republicans appear ready to back Ryan’s plan to have workers under the age of 55 invest up to a third of Social Security taxes they pay into personal retirement accounts. There’s also support for raising the retirement age from 67 to 69 — a change that was first floated in the 1980s when then-Speaker Tip O’Neill and then-President Ronald Reagan were hashing out a long-term solution to the Social Security program and one that was firmly endorsed by the President’s Debt Commission report, released late last year.

Obama said in his speech that he hoped to find “a bipartisan solution to strengthen Social Security for future generations.”

Social Security is currently projected to run out of money in 2039, a scenario that has led many lawmakers to declare it a program in crisis.

But Democratic leaders are deriding Republicans for using scare tactics to drum up despondency about a program that is presently posting about $2.9 trillion in surplus, a number they expect to rise to $4 trillion by 2039.

“It’s only a program in crisis for those who want to privatize it,” said Reid. “The reason they’re going after Social Security is that’s where the money is.”

Democrats, still rankled by the concessions they made during the lame duck, have been excoriating Republicans for playing roulette with the deficit by extending tax cuts for the wealthy and defending defense spending but expecting to balance the budget through cutting social entitlement programs.

“It can’t just be non-defense discretionary spending,” said Democratic Sen. Kent Conrad of North Dakota, chairman of the Senate Budget Committee. “This is a tiny fraction of the federal budget. That can’t be the piggy bank to get our federal budget in control; it’s too small.”

But Republicans object to equating tax extensions with spending — “you can only believe the extension of current tax rates for two more years creates a bigger deficit if you believe that is the government’s money,” said Sen. John Cornyn of Texas — and counter that it’s entirely defensible to seek to balance the budget writ large on the back of money presently in the bank.

“The biggest threat to Social Security is our debt,” said Nevada Sen. John Ensign. “The debt is unsustainable. That’s a threat to everything, including Social Security. We have to look at what we can possibly do to make it a better system, and you at least have to look at things like raising the retirement age.”

Ensign is one of several Republican senators pushing for Congress to adopt a balanced budget amendment to the Constitution, which would require the federal government to strike an equilibrium in the budget every year. That’s only one of the existential proposals on the table: Republicans and Democrats are also proposing budgeting in two- and five-year increments from here on out, as a way to set a long-term plan for tackling down the national debt, currently topping $14 trillion — or about $45,400 per person in the United States.

Join the Discussion:

Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.

Full comments policy

Previous Discussion: 23 comments so far…

Comments are moderated by Las Vegas Sun editors. Our goal is not to limit the discussion, but rather to elevate it. Comments should be relevant and contain no abusive language. Comments that are off-topic, vulgar, profane or include personal attacks will be removed. Full comments policy. Additionally, we now display comments from trusted commenters by default. Those wishing to become a trusted commenter need to verify their identity or sign in with Facebook Connect to tie their Facebook account to their Las Vegas Sun account. For more on this change, read our story about how it works and why we did it.

Only trusted comments are displayed on this page. Untrusted comments have expired from this story.

  1. "The debt is unsustainable" says John Ensign. When did he speak out about the $7 Trillion debt created by Bush? About billions for NO BID CONTRACTS to Republican contractors?

    Nearly 50% of the entire National Debt was Created by Bush and NEVER ONCE did Ensign speak out about Republican spending, so he is "worried about the Debt"? Or does his family need their HUSH MONEY PAID BACK through Government Contracts?

    The next Republican President will ratchet up defense spending for missile systems etc. all over the world using the Privatized Social Security Payments and spend the cash without any legal or moral obligation to pay it back.

    Incur Retirement Debt, they DISSOLVE IT with the next RECESSION! No Government debt, NO PRIVATE DEBT. What a plan for free money for the privileged few!

    Where are the jobs John Ensign? Where are the Jobs? Or are you more interested in destroying Democracy?

  2. Why is the author indulging in hyperbole? This statement: "Social Security is currently projected to run out of money in 2039" is a disservice to readers as this report shows:
    http://www.cbo.gov/ftpdocs/96xx/doc9649/...

  3. "Obama said in his speech that he hoped to find "a bipartisan solution to strengthen Social Security for future generations."

    Karoun Demirjian, it is best to address or refer to Mr. Obama as "President Obama" when quoting him from speech or text. You write as if the President is in your living room speaking as a private citizen. As you can see you started your sentence referring to our President as---Obama and not as President Obama.

    Please show concern to us, the readers, when writing about important issues being debated by important people.

    Thank you.

  4. It's not a matter of if, but when. We have to borrow money from China to pay Israel.
    Forget about it, just give aid to Israel with our last borrowed dollar and cut aid to ourselves. Cut aid to ourselves. But not Israel.

  5. When you have "Family Money", as Senator ensign does, and a GOVERNMENT PAID RETIREMENT & HEALTH CARE PLAN, as Senator Ensign does, how freaking elitist is it for our Senator Moot Ensign to want to join the Republican Plan to steal Social Security.
    What a freak.

  6. This is Republican policy: Destroy Social Security.

    Every single Republican that has ever been in office hates it.

    Now they are taking a course of action that Social Security is one of the main problems with our spending and budget deficits. And this is totally a lie.

    But Republicans will say and do anything to get their grubby mitts on Social Security.

    Mark my words though.... If Republicans get their way and privatize it, do away with it and/or do anything other than the quick fixes that need to be done to it....they need to fully understand they will end up vaporizing the GOP at the next elections.

    The GOP will cease to exist. Because the voters out here can only take so much. You will actually see the Republican Party reduced to irrelevance with no impact for generations to come.

    Do it, Republicans.

    Make that move for Social Security.

    And then be prepared for the backlash. Because there won't even be a Republican in office as Dogcatcher General of the United States if they do away with Social Security or turn it over to Wall Street.

  7. Thank GOD we reelected Senator REID...
    Harry will do the right thing, as usual!!!

  8. Of course Harry doesn't want SS privatized or eliminated. He and the other outlaws don't want to lose their big piggy bank! They have robbed from the SS Trust Fund for so long that they are addicted to the illegal practice of raiding it.----------Also, it's interesting to see ol' Harry at odds with Obama's resolve (cough) to veto earmarks. This will severely cripple Harry's ability to give all the taxpayer-funded kick backs to his campaign supporters who have been expecting them. Sweet irony! It will be interesting to see if Obama caves on this, his latest promise, in the long line of ones he has broken.

  9. To ColinFromLasVegas: I beg to differ with you, Colin. The GOP wants to SAVE SS, not destroy it. All those false liberal talking points you repeat don't fly any more with thinking people. Way back in the early 1980's, Galveston County Texas privatized their retirement program BEFORE THE GOVERNMENT OUTLAWED SUCH PRACTICE and their system is working very well and thriving to this day. It shines as a model to strive for. It would work at the federal level, too. Enough with the baloney, Colin, OK? The sleeping giant of patriotic America is awake and we're not buying the liberal baloney anymore.

  10. I would only add to Mark Schaffer's comment that the report he references is from 2008 and apparently there is a newer report out from the CBO that takes into consideration the lower rate of collections and such for the last couple and next few years. Where they thought the social security trust fund would be taking in money again for a few years, they now believe that it will continue to drain going forward if no changes are made. Here is the link to the newer (October 2010) report that says that the trust fund will be exhausted in 2039.

    http://www.cbo.gov/doc.cfm?index=11943

    Let's all try to use the current data.

  11. John Ensign wants us to make Social Security better by cutting it? What planet does he live on?

    Thank you, Senator Reid.

    Don't fall for Republican lies.

    Social Security "is emphatically not the cause of the federal government's long-term deficits, since it is prohibited from borrowing and must pay all benefits out of dedicated tax revenues and savings in its trust funds." Economic Policy Institute

  12. To RichardHopkins: Read your comments. Noted.

    I STILL say the Republican Party needs to back up their rhetoric.

    They need to make a move to privatize and/or do away with Social Security.

    DO IT!

    Because the resulting backlash at the voting booths will be catastrophic. The Republican Party will literally be blown to smithereens and dust blown to all four winds....seemingly overnight.

    And they know this.

    That's why they are doing this back door thing. They walk something out, then they back step and say, no, no, no, no, I didn't say that, I said this.

    But that's okay. We, the American people, are watching them. And watching them closely.

    I make this prediction: The Republicans will NEVER, EVER get their grubby mitts on Social Security.

    Because they know they can't roll out that stupid slogan.."We are doing the will of the American people"...because they clearly are doing it only for themselves and their Wall Street backers. We're not fooled by their stupid empty words anymore. The Republicans in power now know they will be committing political suicide if they pursue Social Security. And let me tell you right here and now, I WILL ALWAYS be here to remind them of that too.

  13. Social Security is not the biggest part of the long term debt problem, that is true. And I think that some of the call for redoing it is just to help defer having to redeem the debt in the trust fund. It seems that I read that in the next 10 years we will have to sell $600B in debt to others to redeem the debt needed to pay our the social security shortfall. Medicare is by far a bigger liability than social security. Even the prescription drug portion of medicare is a bigger liability. But in the end, all of the programs probably need to be tweaked to some degree.

    A number of people like to point to the Chilean experience with privatizing their social security equivalent. While it isn't a perfect comparison and is not without problems, the story of it is worth a read. Here is a document from our Social Security Administration's site:

    http://www.ssa.gov/policy/docs/ssb/v59n3...

    It is easy to show that people could be better off with a privatized system but there is a level of risk, especially given the low level of financial literacy in this country. The worry that I have is that there is a significant potential for people to get pulled into bad investments and lose their money. The Chilean system does some to prevent that from happening. But social security has an average rate of return of only about 1.2% for a typical family. If you look at a portfolio with just a 4% rate of return, that makes a huge difference in the amount of money available at retirement. A dollar invested at 1.2% yields just 71 cents in 45 years. That same dollar invested at just 4% yields $4.84 in 45 years. So, if a 20 year old has $3000 paid into SS, it is theoretically worth about $5130 at age 65 but invested elsewhere at 4% interest it would become $17,520. Just something to consider when talking about the issue of social security.

  14. Willaim is partially correct but fails to explain what exhausted means. This quote shows more about the CBO report and Willaim is correct to use newer figures but please remember these are projections that will always contain uncertainty:

    "CBO projects that the DI trust fund will be exhausted in fiscal year 2018 and that the OASI trust fund will be exhausted in 2042. Once a trust fund's balance has fallen to zero and current revenues are insufficient to cover the benefits that are specified in law, a program will be unable to pay full benefits without changes in law. The DI trust fund came close to exhaustion in 1994, but that outcome was prevented by legislation that redirected revenue from the OASI trust fund to the DI trust fund. In part because of that experience, it is a common analytical convention to consider the DI and OASI trust funds as combined. CBO projects that, if legislation to shift resources from the OASI trust fund to the DI trust fund was enacted, the combined OASDI trust funds would be exhausted in 2039."

  15. Also, Willaim fails to note that Social Security is not an investment but works by having current workers pay for current retirees. The system is not saving the money workers put into it for their own retirement or that money would be gone in a short period of time, far shorter than the time people tend to live past their working life. So Willaim either doesn't understand how the system is designed to function or is misleading readers.

  16. @Colin...

    "Because they know they can't roll out that stupid slogan.."We are doing the will of the American people"..."

    THANK YOU!!!

    At least I'm not the only one that sees this silly, always malleable "will of the American People" lie for what it is...
    EVERY TIME I hear it uttered, I think to myself, "What a load of CRAP."

    "We have a Tea Party Mandate from the November election cycle"...
    ANOTHER load of CRAP I refuse to step in.

    Bottom Line:
    America MUST & WILL honor it's debt to Baby Boomers & future generations by paying out every last nickel that retiree's have coming through Social Security (& Medicare).
    If Republicans want to try to weasel out of their obligations, and if Republicans want to raid Social Security by setting up their Wall Street pals through a Privatization of the system, we Dem's & Independents will show you what "will of the people" REALLY MEANS!

  17. Privatize it? Pray tell how. Like in the stock market as Republicans proposed 6 or 8 years ago? Yeah, and we all know what happened to the stock market and the 401K's and retirement accounts of millions of our citizens. Nope, keep private for profit companies completely out of it. Smells like big bucks for big donors to me.

  18. This is almost to comical to be true, most readers do not remember who it was who raided the Social Security fund. JFK (D) raidedn the fund to put us
    into the Race to Space and put the first man in space and man on the moon. LBJ ((D) not only
    raided the Social Security fund to pay for Viet Nam but he also with Democrat support put the Social Cecurity fune into the General Fund. At that time the race was on to bleed it dry for all the "Great Society" programs that He, Ted Kennedy
    and other Socialist Liberal could dream up. As a result we have been waiting for the system to dry up and go broke. Currently the goverement owes Social Security receipants more than they will ever have in the fund. They have used the Social Security money to do all the "Touchey, Feel good" things that Liberal are so good at. Unfortunatley not the time has come to pay the piper and they still do not want to face rality and understnad that now they will have to cut their excess programs and reduce spending.

  19. Actually, Longtimevegan, it's perfectly normal practice to refer to the President on second and subsequent references by his last name alone, as is the case with senators, representatives, and pretty much everybody else that appears in stories (unless you're reading a publication where standard practice is to preface all names with a "Mr.", "Ms.", "Dr.", etc.) But we don't normally do that at the Las Vegas Sun.

    What we do follow is AP style -- and there I think you just unintentionally brought up an interesting point. The AP changed its ruling about correct presidential style shortly following the 2008 elections: 100% adherence to the stylebook now says that on first reference, the commander-in-chief is supposed to be "President Barack Obama" ("Obama" and such okay after). However, most news organizations that otherwise follow AP style have gotten a little lax about that directive and usually do what I did in the blog above: refer to the President on first reference as "President Obama" and then "Obama" or by his titular designation in references following.

    Thanks for reading.

    - Karoun

  20. Anyone from 21 thru 30 should move to Australia. Leave this country without a workforce to drain tax money from,

  21. And we have a winner for dumbest statement of the day which goes to Jack Uhern.

  22. If privatization is not palatable to some of you, then what would you suggest to save Social Security? Privatization is working in Galveston County, Texas. Why does the fed govt. want to retain complete control? I think the answer is obvious and has been vividly demonstrated in the past. The govt. doesn't want to give-up their big piggy bank. SS could be FIXED. No one, including the GOP, is advocating the DESTRUCTION of SS, as the liberals calim. They just want to FIX IT!

  23. Leave SOCIAL SECURITY alone! The Republicons simply want to get their greedy corrupted mits on trillions and dump it in the market.

    When that fails and it will,...NOBODY WILL HAVE ANYTHING! Don't screw with something thats not broken but certainly will be if left to the wrong people.