Commentary
“I will fight them with everything I’ve got to keep their grubby little hands off it.” Rep. Brandon Boyle (D-Pennsylvania)
That quote is typical of Democrats, who while having the House, Senate and the White House, knowing of Social Security’s projected insolvency in 2034, kicked the can down the road.
When the president invited Elon Musk to look at waste and fraud in government, it didn’t take him long to note that it was mostly in entitlement spending – Social Security, Medicare and Medicaid – suggesting it was ”maybe $6-700 billion a year.” The liberals on the left didn’t want to hear that, and soon they branded Musk as a bully and even a Nazi.
The Social Security Administration made an estimated $72 billion in improper payments between 2015 and 2022. In addition, the Government Accountability Office estimates taxpayers lose as much as $521 billion annually to fraud, and most of that is within entitlement programs, such as Medicare and Medicaid.
Last month, Rasmussen Reports noted that 72 percent of likely voters believe it’s important to prevent illegal immigrants from getting government benefits.
But while ICE is facing protests as it is ramping up efforts to remove illegals from an array of taxpayer-funded benefits, 45 percent say the government isn’t doing enough.
Trump’s Response
“There’s so many things we can do,” he said. “There’s so much cutting and so much waste in so many other areas, but I’ll never do anything to hurt Social Security.” President Trump
Having made this pledge several times, you would think the left would get it, the president means it, but statements like Representative Boyle’s above continue.
They are now attacking the so-called “Trump accounts” for American newborns that passed in the big, beautiful bill as a “backdoor way” toward privatizing Social Security.
Under the program, American children born this year through 2028 are eligible for a one-time $1,000 contribution from the federal government per toddler into a mutual fund or index fund that is tied to the performance of the stock market. Parents can contribute up to $5,000 annually to the tax-deferred account.
Trump saw it as an innovative way to get more Americans to take part in the financial system, increase financial literacy and build retirement savings.
It’s further evidence of the president listening to his economics advisors and taxpayers, like his pledge of no taxes on tips and offering of a deduction on the interest on the money you borrow to purchase an American-made car.
The idea of privatizing Social Security has been bandied about for at least a decade. Under privatization your money would no longer be managed by a government-managed trust fund that regularly pays you benefits. Instead, you would invest your funds in private accounts that could potentially earn higher returns than the government-managed trust fund, leading to greater individual wealth in retirement.
Not only are middle-aged workers hearing about the potential insolvency of Social Security before they near retirement, but they’ve also watched their 401k’s growth (hopefully at the limit) and are learning more about the stock market and wealth management. I understand that 61 percent of U.S. adults own stock in one way or another.
I read of one plan that would only offer workers under age 55 an opportunity to opt out of Social Security. If they haven’t been investing early, like at 18 years of age, it’s not too late. That seems to make sense when you read in the 2024 Annual Report on Social Security “Under intermediate assumptions, the projected combined trust fund asset depletion date in 2034.”
President Trump has said, “I will not cut a single penny from Social Security or Medicare, and I will not raise the retirement age by a single day,” but it doesn’t mean Congress should continue to ignore the needed reform to save it.
But voters get nervous when they hear that Congress wants to address Social Security reform, even though it should be a high priority.
Unfortunately, Senators Bill Cassidy (R – Louisiana) and Tim Kaine (D-Virginia) who are proposing what they term the first bipartisan Social Security reform plan in decades, are on the wrong track.
They claim that the establishment of a “pension obligation fund” would help fill Social Security’s $25 trillion funding gap without raising taxes or reducing benefits. It’s “a dubious investment practice that has been used by underfunded government employe pensions in Illinois, California and New Jersey,” wrote Andrew G. Biggs, a senior fellow at the American Enterprise Institute, who comments, “a pension obligation fund not only carries significant risks, it doesn’t built wealth.”
Biggs seems to lean toward a “sovereign wealth fund,” which creates new wealth.
I hope our legislators reject the Cassidy-Kaine plan and get together to fix Social Security. “If lawmakers think that’s too much to ask of them, then it’s fair to say that American governance has failed.,” says Biggs.
May God continue to bless the United States of America.
