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Mike McFadden open to raising the age for Medicare benefits

McFadden for Senate
Mike McFadden: "The senior safety net is heading towards bankruptcy because of irresponsible politicians like Al Franken who’ve used scare tactics to win elections."

This is one in an occasional series of articles about the policy positions of U.S. Senate candidates Mike McFadden and Al Franken.

In order to head off the projected insolvency of the Medicare Trust Fund, Republican U.S. Senate candidate Mike McFadden would favor raising the age of eligibility for Medicare benefits.

McFadden is open to other fixes for the analogous problem with Social Security, but wasn’t willing — despite being pressed on it several times in a recent interview — to indicate any measures he would endorse to extend the solvency of the Social Security Trust Fund.

McFadden took several other policy positions in an interview last week, which I will write about soon. But this piece will focus on a long, somewhat strange exchange over the big senior entitlement programs.

As regular Black Ink readers know, I’ve been pursuing McFadden for policy specifics. To his credit, he has granted me several interviews recently to pursue those positions. Last Friday, we went over a specific set of issues on which, to my knowledge, he had not yet taken a coherent position.

One of them was the projected insolvency of Social Security and Medicare. “Insolvency,” by the way, doesn’t mean going broke, as it is too often termed. It means that official and reasonable projections for both Social Security and Medicare indicate that they will in the foreseeable future not be able to pay all promised and projected benefits from the dedicated income streams (mostly FICA payroll taxes) that have supported the programs for decades.

In the issues section of his campaign website, where many of his position statements raise far more questions than they answer, McFadden says:

Save Medicare & Social Security From Going Bankrupt. We can keep our promises while also being realistic about the challenges our current program faces. The senior safety net is heading towards bankruptcy because of irresponsible politicians like Al Franken who’ve used scare tactics to win elections. We have to take action to preserve this important program for future generations.

I had been asking what action McFadden proposed to take to save the big senior entitlement programs from bankruptcy. Even though he had the question in advance, and had agreed to the interview, it was surprising how hard McFadden fought to avoid committing himself to anything resembling a change in either program that would extend their projected solvency. On the chance that you might find it interesting or amusing, here’s the full exchange:

Eric Black: What is your proposal for extending the actuarial life of these programs?

Mike McFadden: We have a problem in this country. We have a problem with our senior entitlements and I believe this is a perfect example of how broken Washington is. We don’t address the issue. Here’s the facts, Eric, and you know them. Right now if you look at Social Security and Medicare, in 1950 there were 16 workers per retiree. Today there are three per retiree. And we’re headed toward two per retiree. The Social Security Administration says that Social Security is insolvent in 19 years, in 2033. Insolvent. That’s from the Social Security Administration. The CMS [Centers for Medicare and Medicaid Services] says Medicare is insolvent six years later, in 2026. [EB: I know, the math on those two dates doesn’t work].

EB: OK, so what’s your proposal?

MM: My proposal is that we address it now, in a bipartisan fashion and that every issue is on the table. Anytime a politician in Washington tries to address long-term entitlements they get demonized. You asked about what scare tactics Al Franken used. In 2008, a Franken ad falsely implied that Norm Coleman would take away survivor benefits, and Tom [an aide to McFadden] will send you the back up on that. [EB: I’ll do a short separate on that allegation in the next few days.]

But it’s not just Senator Franken. This is Washington. Anytime they try to fix something … we are on the road to insolvency and [if] we address it today when we have optionality, we can do it in a way where we don’t affect anybody, Eric, that’s near-term retirement. That wouldn’t be fair.

EB: What is the way that you would favor. I understand that you want to negotiate, but which of the proposals to make this happen would you support at the table?

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MM: What I would support at the table is sitting down and looking at, when I say everything is on the table, everything’s on the table. What I wouldn’t support is anything that would change the benefits for people that are nearing retirement. And by that I mean 10, 12 years from retirement

EB: I believe that’s almost a universal agreement that people who are at or near retirement have to have their promised benefits guaranteed. I haven’t heard you mention anything that is going to make the situation better as far as heading off that [projected insolvency].

MM: What I have said is I’ll sit at the table and get this fixed. I’ve heard many people say that we don’t have a Social Security or Medicare issue. I think that’s wrong. In fact I think it’s immoral. We are making promises to our kids that we can’t keep.

EB: OK, so you disagree with people who say there’s no problem. You think there is a problem. You want to sit at the table and you want to do something. There’s certain things you don’t want to do. You haven’t mentioned yet anything that you do want to do. To change the program.

MM: So what I want to do, let’s look at Social Security. Social Security you have two issues. You have a demographic issue and you have health-care costs. [At this point, he apparently realized that he was talking about Medicare, not Social Security, so he switched]. So on Medicare you’ve got two issues: you’ve got a demographic issue and a cost issue. And I think we need to look at the retirement age and what age an individual becomes eligible for Social Security, excuse me, for Medicare.

EB: Obviously look at raising it?

MM: Yeah. Absolutely. And you know, Eric, if we were progressive, when this was put into place when the average lifespan was significantly lower than it is today, you’d almost put it in as a formula, take the average lifespan minus some number of years. Because otherwise we’re gonna have to revisit this question.

EB: So one thing is to raise the age for Medicare benefits and maybe put in place a formula that would cause it to continue going up in line with changes in life expectancy?

MM: Yeah, you tie it to life expectancy. Who knows how long our kids will live?

EB: And you are in favor of raising the age it for Social Security as well?

MM: Well, right now they already did, they raised it to 67. I think you know we would need to look, you know they phased that in and they gave people ample amount of time to do that.

EB: That’s still headed for insolvency, so what would you do about it?

MM: We need to put all options on the table.

EB: Tell me about the options that you would put on the table that you would support.

MM: Everything, Eric.

EB: Everything anybody can think of that could be done that would extend the solvency of Social Security, you’d be for?

MM: No, I didn’t say that I would be for; all I would say is that we have to look at all the different options.

EB: Oh, you favor looking at them all?

MM: What I said is that I favor looking at them and coming up with a solution, and one that allows us to save Social Security and Medicare. 

EB: OK, so you’re not at this point prepared to talk about elements of the solution that you would favor, you just think it needs to be solved and all options need to be on the table?

MM: That’s right, all options need to be on the table; we have a problem. Politicians have not addressed it. Any time that people have tried to address it and say that we have a problem, they get accused of not being sensitive to seniors, and I think we have to address it so that we can save these programs.

That’s the end of the exchange on the entitlements, although we talked about several other topics, some of which I will write about soon.

It’s fairly obvious that McFadden didn’t come into the conversation intending to announce a position on changing the age for Medicare benefits. I insisted fairly hard that everything-is-on-the-table was not a position — even though he said himself that anyone who takes such a position risks being “demonized.”

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Comments (78)

  1. Submitted by Steve Titterud on 07/23/2014 - 08:54 am.

    McFadden seems terrified of disclosing his real intentions,…

    …or perhaps the only real intention he has is to try to get elected.

    MN can’t stand a man of this low caliber in the Senate, no matter how much money he makes.

    • Submitted by Dennis Tester on 07/23/2014 - 09:50 am.

      “MN can’t stand a man of this low caliber in the Senate

      Thanks for making me spill my coffee. I think if we can survive an alleged comedy writer for 6 years we can survive a successful businessman in that seat. Jus sayin.

      • Submitted by jason myron on 07/23/2014 - 01:01 pm.

        I guess envy

        isn’t just for democrats any more… right Dennis? You just can’t stand the fact that Franken made millions off his craft, in a business that chews up and spits out writers left and right. You might not like his humor, but you can’t deny his success and its every bit as viable as McFadden’s.

      • Submitted by Sagrid Edman on 07/23/2014 - 01:02 pm.

        The alleged comedy writer

        Sorry, for disagreeing. Al Franken has been anything but a comedian in his 6 year term. He has worked hard on legislation that helps individuals and families. He is a smart, thoughtful person and has left behind his comedy past.

      • Submitted by RB Holbrook on 07/23/2014 - 02:40 pm.

        Show business people in government?!

        An ex-comedian in the Senate? What a horror! It might encourage all kinds of entertainment types to go into politics. Before you know it, some B-movie star would run for Governor of a state, and then President! We might have some has-been commercial spokesman running for President!

        No one wants that. You are right to be dismissive.

      • Submitted by Steve Titterud on 07/23/2014 - 05:42 pm.

        McFadden could hardly be thrilled with such faint praise as…

        …you give him here.

        By implying that he’s no worse than Franken, of whom you hold such a low opinion, McFadden might worry whether this is the closest thing to enthusiasm he can arouse.

        I should think he would find this discouraging. (“…if we can survive [Franken]…we can survive [McFadden]…”) – my additions for clarity are bracketed.

        Sorry about that coffee, man.

      • Submitted by Kenneth Kjer on 07/24/2014 - 11:03 am.

        McFadden

        We don’t know who he is or what stands for, he refuses to say. All he does is run off at the mouth and criticize opponents. I don’t think he is capable of intelligent thought. He also likes to use children in his ads who pretend they know what they are talking about. Did the kids get paid, where they even legal to be working?

  2. Submitted by Gerald Abrahamson on 07/23/2014 - 09:11 am.

    McFadden shoots himself in both feet

    because nobody has a clue what he wants to do or why.

    He had a chance to “get his talking points out there” and he totally blew it.

    We STILL do not know what he will actually DO, meaning specific changes that will WORK.

    “Elect me because I will put everything on the table” is garbage. That is “politician talk” for doing NOTHING. Big hint: Every session of govt has “everything on the table”.

  3. Submitted by Sean Olsen on 07/23/2014 - 09:17 am.

    Stupid, stupid, stupid

    Let us count a few of the ways that raising the Medicare age is stupid:

    1.) It saves a relatively small amount of money. Per the CBO, implementing this in 2016 would save the federal government $19 billion over the first eight years.

    2.) But it will raise costs for everyone else. The 65 and 66 year olds will spend $2 billion more annually getting their insurance from the private market (per the Kaiser Foundation). Employers will spend about $2 billion a year covering those 65 and 66 year olds who are still working. Premiums in both the exchanges and in the private market will go up because the risk pool will become older an less healthy, at a cost of over $1 billion a year. So, essentially, to save the federal government less than $3 billion a year, we’ll be asking everyone else to spend about $5 billion a year. That’s a really bad deal.

    3.) Raising the Medicare eligibility age encourages blue-collar workers (who haven’t seen the increase in life expectancy that other workers have) to stay employed — at real costs to their health and bottom line. Being unable to get Medicare at age 65 is a distinctly regressive change that hurts lower income folks much more than higher income ones.

  4. Submitted by Hiram Foster on 07/23/2014 - 09:31 am.

    Evasions

    Good thing he didn’t run his football team that way.

  5. Submitted by RB Holbrook on 07/23/2014 - 09:34 am.

    They should call him “Eggo” . . .

    . . . because he’s nothing but waffles.

    When his one TV ad emphasizes how “tough” he is, and how he teaches kids to block, I have trouble believing him when he makes his pious promises of addressing any issue in a bipartisan fashion.

  6. Submitted by Pat Berg on 07/23/2014 - 09:36 am.

    Shame on his handlers!

    His handlers had plenty of time to tell him what he should answer on these questions. They’re obviously falling down on the the job.

    Time to fire them all and hire a new set of “experts” to tell him what his positions should be . . . . . .

  7. Submitted by Paul Brandon on 07/23/2014 - 09:44 am.

    The facts

    Most of the increase in the life span is people in the upper half of the income range, who are not dependent on Social Security.
    The lower half, who really need it, don’t live significantly longer than they did twenty years ago.
    So we know who McFadden is appealing to.

  8. Submitted by mark wallek on 07/23/2014 - 10:05 am.

    Sure Mike

    Let’s raise the age to 80. Is that high enough to assure your sponsors will see increased profits?

  9. Submitted by Karen Sandness on 07/23/2014 - 10:12 am.

    That old talking point again!

    Mike McFadden needs to learn basic arithmetic. The PROBLEM with Medicare is that it treats only the oldest Americans. For the average person, health problems increase with age, so the average 75-year-old is not as healthy as the average 65-year-old. Raising the age of eligibility will only increase the expense, since younger (therefore healthier) people will not be paying premiums.

    The age of eligibility should instead be lowered so that younger, healthier people (perhaps the over-fifties that the insurance companies insist on charging extra for) are paying premiums. Yes, even under the ACA, the insurance companies are expressly permitted to levy a surcharge on people over 50.

  10. Submitted by Susan McNerney on 07/23/2014 - 10:16 am.

    Franken must be giddy

    this guy is going with attacking Medicare and SS (and with mathematically nonsensical positions at that). The ads write themselves.

  11. Submitted by Dimitri Drekonja on 07/23/2014 - 10:49 am.

    Raising medicare eligibility is just a game of 3-card monty. Yes, the budget for medicare is going up, because even people like McFadden recognize that there are more older people living longer. Having more people in a program does drive up the cost.

    But what he doesn’t say (or know?) is that medicare delivers care far more efficiently than the private insurance sector, with administrative overhead running in the 3-4%, vs. the 25%+ seen with private insurers. So by keeping people in the inefficient private insurance world, and delaying their entry to the more efficient medicare, he is basically increasing costs. Medicare will save some amount, but the costs will be shifted to the just-under-eligibilty age crowd.

    A far better idea (since “all options are on the table”, whatever that means) would be to put everyone into medicare, and fund it via a progressive income tax and an employer tax (i.e., a single-payer plan for all). Slashes administrative waste and duplication by the 2000+ private insurers. Decouples employment and health insurance. Gives businesses what they supposedly crave— stable costs to plan around (much easier to plan for a known tax rate then to wait to find out each year how much your insurance rates will be raised). Oh, and would eliminate all the judicial energy being poured into whether the ACA is legal or not. Worth considering, with everything on the table…

    • Submitted by Paul Brandon on 07/23/2014 - 11:20 am.

      It’s called a national health care system

      It’s what they do in the civilized world.

      • Submitted by Sagrid Edman on 07/23/2014 - 01:09 pm.

        a national health care system

        Yes, agree.
        But the first thing I heard this supposed candidate say in one of his speeches at (I think) the Republican convention was a strongly stated position of ‘repealing the ACA. The same thing the Republicans have been trying to do in Congress over 50 times. Does he really think that he will be able to try that and take health care insurance away from the millions of folks who are covered now under he ACA?

  12. Submitted by David Frenkel on 07/23/2014 - 10:52 am.

    Political realitie

    So the GOP base is now excludes seniors. Does McFadden understand how strong the senior lobby is on Capital Hill? We all want to be rational and reasonable but that isn’t how the system works unfortunately.

    • Submitted by RB Holbrook on 07/23/2014 - 11:38 am.

      Who is excluded?

      His Medicare proposal will not affect those who are now seniors, or those who will fall into that category in the next decade. They are the powerful ones, because they show up to vote. The ones who will be getting the shaft here are the younger people, who won’t be retiring for at least another 20 years (Gens X and Y, the Millenials). Their political power is negligible, so Mr. McFadden can afford to marginalize them.

      • Submitted by jason myron on 07/23/2014 - 12:17 pm.

        Exactly, RB

        enough of his voting bloc are the kind of people that would have no problem shafting younger generations. In their minds they deserve the benefits, but no one else does because…well, you know… they’re the TRUE Americans. Nobody worked as hard as they did and everyone after they retired are just slackers. The flaw in this tactic is McFadden and the rest of the GOP’s inability to acknowledge the writing on the wall that the demographics of this country continue to change, and not in their favor. They just continue to be perceived as neanderthal by a larger and larger segment of the population.

  13. Submitted by Paul Landskroener on 07/23/2014 - 11:29 am.

    Ask specifically

    Ask him: If “everything is on the table”, are you willing to discuss increasing the employer and employee contribution (aka tax) to Social Security? How about decreasing benefits? Or means testing them? Are you wlling to discuss raising the income cap on contributions from $114,000 to, say, $250,000? How about abolishing Social Security altogether? What a nothingburger his guy is.

  14. Submitted by Steven Bailey on 07/23/2014 - 11:43 am.

    A real fix for Social Security

    Cut the FICA tax on all people and employers in half and apply the new rate to all income levels. No one over making less than $213,600 would see any increase and people making less than $106,800 would see their rates cut in half. It would be the biggest stimulus ever for small businesses and the self-employed. Medicare has real financial problems unlike Social Security which is still solvent for a long time. Without Medicare being able to openly bargain for drug prices we have no chance of fixing it.

  15. Submitted by Connie Sullivan on 07/23/2014 - 12:09 pm.

    This guy has already been “handled” by GOP players; that’s why he speaks gobbledegook like the stuff Sarah Palin fed the public in 2008 when the McCain campaign “handlers” realized how absolutely ignorant she was on almost all issues. They gave her sound-bites to memorize, and she only slipped when she went off the memorized sound-bites. Most voters, however, were able to see the horror of having someone as blank as Palin ever be close to stepping into the Oval Office. They voted for Obama.

    The problem is that today’s GOP, or this guy’s “handlers,” don’t realize that their positions on Social Security, Medicare–and increasingly, on Obamacare!–are at odds with the majority of public opinion; people actually like these programs. So they can’t state those GOP positions. They’d be “demonized” (as they were for wanting to eliminate Social Security and Medicare by voucherizing them, privatizing them).

    Eric Black is doing us all a big service, by pushing this candidate into his absurd circles of nonsensical non-responses that he seems instructed to fall back into.

  16. Submitted by Roger Anderson on 07/23/2014 - 12:19 pm.

    Eric Black interfiew of Mike McFadden

    Very impressed with Eric Black’s ability, during this interview, to summarize McFadden’s positions and redirect the interview back to the the point under discussion. Not his fault that this didn’t always work.

  17. Submitted by Paul Udstrand on 07/23/2014 - 12:48 pm.

    Of course

    Nothing saves health care dollars like denying health care. Hey, if you don’t provide it, you don’t have to pay for it, any good banker will tell you that. And given the fact that the Unites States is the most dirt poor nation on the planet we certainly can’t afford to actually pay for health care. No, you gotta have giant economy like the Netherlands to do something like that.

  18. Submitted by Rachel Kahler on 07/23/2014 - 02:50 pm.

    I like this

    This is how I envision the interview going.

    EB: Dials McFadden from his iPhone or Android.
    McFadden: Lifts the handset from its base, answers, and commences to nonchalantly twirling the cord around his finger while turning in his office chair back and forth, back and forth. He’s got this stuff DOWN.
    EB: Asks question about how McFadden would do something.
    McFadden: Gives talking point about how bad Washington is, particularly his opponent.
    EB: Re-asks question because answer not given.
    McFadden: Thinks “oh crap, he actually means to get this answered.” Reiterates talking point because he needs to boot up computer to Google the answer, and hopes that Eric will roll over like they do on the presidential debates.
    EB: Re-asks question because McFadden is fumbling with his computer.
    McFadden: Pulls some schtuff from his keister while desperately waiting for his computer to boot. Because he’s too out of touch to upgrade his old Windows 95 machine.
    EB: Acknowledges the schtuff from the keister and asks how it’s relevant to a solution.
    McFadden: Waves his hands at his computer and looks around the room in panic, repeats himself, and just wishes he could email his campaign manager. Regrets not having his manager with him. He also regrets to find that he’s stretched and twisted the coiled cord of his phone to the point of balling up on itself. He’ll have to dangle it upside down after this call to fix it. But it will never be the same.
    EB: Rolls his eyes and tries one more time.
    McFadden: Giddy that his computer has finally booted, also regrets his decision to cheap out on his internet. The computer dials, hums and buzzes, crackles and finally connects.
    EB: Changes topics, realizing that McFadden is all huff and puff and no blow.

    Of course, this is just entertainment in my own mind. It probably didn’t happen this way, but just as well have. This guy has no solutions, just talking points–the same nonsense the rest of the GOP has.

  19. Submitted by Lance Groth on 07/23/2014 - 04:52 pm.

    “Everything?”

    It would be simple enough to pop this guy’s balloon. When he says “everything” is on the table, ask him if that includes tax increases, especially for the rich. He’ll of course say “no, no tax increases”, and everyone will see what a phony he is.

    Or at least, that’s how it would go if he’d just answer the question. In reality, he’d just spit out more boilerplate about how broken Washington is, and take an irrelevant jab at Franken. Which comes to the same destination, come to think of it.

  20. Submitted by Ron Gotzman on 07/23/2014 - 05:24 pm.

    What would “big AL Do?”

    What is Al Frankens position on these issues?

    • Submitted by Bruce Johnson on 07/23/2014 - 06:35 pm.

      From a link at his website

      http://www.franken.senate.gov/?p=video&id=2256

      Franken’s website, search ‘Medicare’, from about the 4th result on 1st page of 10 or more, a 15 minute video of a Senate floor speech in late 2012. Extending age of eligibility at 11:40.

      “This is exactly the kind of bad idea that explains why our health care costs twice as much as (elsewhere) and in most cases, with poorer outcomes.”

    • Submitted by jason myron on 07/23/2014 - 11:26 pm.

      SInce you couldn’t figure out

      how to search for the answer to your question, I’m guessing that Rachel’s post hit a little too close to home.

  21. Submitted by THOMAS REYNOLDS on 07/23/2014 - 06:33 pm.

    SS & Medicare

    First, neither are entitlements… both were paid for by workers with funds put in a trust. Was the trust raided by congress, of course. But demographics and age longevity are not the real problem. In our economy we have put limits on FICA and Medicare contributions, while those earning under the limits have seen their earnings power being eroded, while those above the limits are taking a larger share of the income streams. This has cause a great disparity between pledges promised, vs delivering on the guaranteed payments. Tax policy must change and contribution limits removed, along with Congress keeping its hands off the trust fund, to ensure the viability for future payments.

  22. Submitted by Paul Udstrand on 07/24/2014 - 08:00 am.

    Well…

    I have to agree with most posters here, McFadden is going the wrong way with Medicare. From a health care and general economic perspective, we should be expanding eligibility, not contracting it. Medicare is more affordable and more comprehensive than most of the private plans people can get through the exchanges, and higher medicare enrollment would eventually bring down costs because Medicare gets bigger discounts form providers than any of the private plans. Providers complain it doesn’t pay enough but they’re not telling you that they typically overcharge 500%-1000% for everything from tooth brushes to brain surgery.

    McFadden’s rationale for pushing out eligibility reveals typical banker executive ignorance regarding the issue. On a very basic level I have yet to see a republican that actually understands the health care issue. McFadden assumes that what Medicare actually is, and what it actually does, is irrelevant, he’s just looking at cost and looking for short cuts. The correlation and mechanism for extended life expectancy is health care, not wellness. In other words, the reason people are living longer is they get more effective medical treatment that didn’t used to exist, and typically, that treatment starts for most people well before they retire, in their late 40s and 50s. McFadden is assuming that just people live longer, they don’t need health care until they get older. Exactly the opposite is the case, it’s the health care people get when they’re younger that’s helping them live longer. If we were push out eligibility, we would be denying health at a critical stage when people actually need it the most, not to cope with serious illness, but extend their lives.

    Not only would McFadden be inflicting harm on people by denying health care with his plan, it would also fail to save money. What would happen is we’d be trading earlier less expensive medical interventions for later more expensive and drastic interventions. A guy doesn’t blood pressure and cholesterol meds at 62 ends up needing and emergency by-pass at 75. Another guy doesn’t get type II diabetes diagnosed and treated at 62, or ends up discontinuing treatment because he can’t afford the insurance, and he’s on dialysis or worse by the time he’s 75. It’s not a matter of pushing numbers around a spreadsheet. We’re actually talking about health care here and weather or not you need health care isn’t determined by when you retire, if it were, no one would ever retire and we’d all liver forever in perfect health.

    And of course, note that McFadden let slip his solution to the Social Security “problem” is the same, and I’m sure he thinks privatizing it is a great idea as well. In other words, it’s still 1995 in McFadden’s universe, these were all Gingrich’s ideas back then.

  23. Submitted by beryl john-knudson on 07/24/2014 - 09:57 am.

    regarding Mcfadden political platform or jumping off place:

    Every time I hear the name Mcfadden it reminds me of Mrs Mcfadden, a little old lady from my small prairie village some time ago. She was a prototype one could say in my mother’s ‘circle group’; part of the Ladies Aid Society of the Lutheran Church of Perpetual Faith, or something like that…

    Church basement politics of the early fifties were so similar to Mcfadden’s (hers and his) in their catatonic sense of reality, that I do wonder if there could possibly be any relative connection to the fine old lady of mom’s circle days?Mcfadden could pass for a card carrying member of that blessed religio-splinter group way back when…so it goes?

  24. Submitted by Kenneth Kjer on 07/24/2014 - 10:59 am.

    Social Security solvency

    I have a unique idea on how to keep social security solvent. How about the government paying back the 2.7 trillion dollars it has borrowed from social security? Instead of continuing to rob senior citizens, pay back what the government owes.

    • Submitted by Eric Ferguson on 07/24/2014 - 01:55 pm.

      The government is already paying it back

      When the government borrows the trust funds, it does so by having the trust funds buy treasury bonds. They’re regarded as the safest investment in the world. We’ve never missed a payment, and without the debt ceiling crises the Republicans caused, there wouldn’t be reasonable doubt that they would get paid back. The problem with funding the trust funds is few in power will even consider the obvious answers. For Medicare, let younger, and therefore presumably healthier, people buy in to reduce the risk in the pool. Raising the eligibility age will actually take out younger and healthier people and make the situation worse, not better. For Social Security, lift the cap on income eligible for the tax. Rising inequality has meant an increasing share of income is above the tax, thereby shorting the trust fund on tax receipts. Just lift the cap and Social Security will be fine.

  25. Submitted by Paul Udstrand on 07/24/2014 - 11:48 am.

    Kenneth’s conundrum

    Well, if we rolled back the tax cuts that made those SS draws necessary maybe we could pay it back. The problem is we just can’t figure out how to pay the bills AND decrease revenue at the same time. What’s up with that?

  26. Submitted by Geo. Greene on 07/24/2014 - 12:12 pm.

    Elect me!

    Because I want to fix things. Things I know nothing about and cannot articulate a thought about, nor do I have any positions on, but gosh darn it something needs to be fixed and I’m just the kind of guy who want’s them to get fixed.

    Or did I miss something?

  27. Submitted by John Appelen on 07/25/2014 - 07:32 am.

    Welfare

    So is this group advocating that we replace social security and medicare with welfare for the elderly?

    I have seen multiple comments that recommend we maintain or cut benefits for the well to do and increase the amount they pay for these benefits.

    Why don’t we totally eliminate payroll taxes altogether, eliminate medicare, eliminate social security and care for our elderly via Medicaid and welfare?

    It would eliminate similar agencies and ensure that the savers/investors pay and the unfortunate/unwise receive.

    • Submitted by Paul Udstrand on 07/26/2014 - 10:12 am.

      No John, that’s not what this group is advocating

      “So is this group advocating that we replace social security and medicare with welfare for the elderly?”

      No. What we are saying is that we should properly fund, preserve, and stabilize these programs for future generations. Some of us want to expand Medicare to everyone thus creating a true national health care system.

      McFadden’s solution of pushing out eligibility is a typical executive deck chair maneuver that just kicks the can down the road, and ignores the actual function of Social Security and Medicare, human being actually rely on these programs believe it or not.

      Privatizing these programs is simply a way of dismantling them and putting that money in the hands of financial executives rather than the people who rely on it. Such plans are extensions of the agenda that switched people from traditional pensions into 401Ks and other financial instruments back in the 90s. Again, look at where McFadden comes from, of course he thinks that’s a great idea. Problem is that it’s a engineered transfer of even more wealth into the hands of the already wealthy, who will claim they’ve earned it all by themselves.

      Again, many republicans simply don’t believe that anyone should retire with anything other than their own accumulated wealth. They call these “entitlement” programs and want to eliminate them. The problem is they also believe in economies where only the top 5% of the population can afford to do so. It’s actually really stupid. Listen, if households earning the median US income and American workers actually saved what they needed to retire, even if they got to keep their SS withholdings, they would have to stop buying, or spending a huge chunk of their income every year. THAT would actually crash our economy. And don’t think that people would live the high life off of their investments, look at all the senior that are still working or going to work because their investments just crashed.

      • Submitted by John Appelen on 07/26/2014 - 10:47 pm.

        Pay more Get less

        A desire by people here to have FICA charged on all income…

        While reducing benefits paid to people with higher incomes…

        Equals welfare… Or income redistribution if you prefer…

        This was not the intent of social security or medicare from my understanding…

        People seem to believe they deserve the benefit because they paid for it. (ie entitled) If someone pays the lion’s share of it… Are the others entitled to it or is it welfare?

        • Submitted by Rachel Kahler on 07/28/2014 - 02:08 pm.

          Welfare

          That word…I do not think it means what you think it means.

          The proper term is “insurance.” That is, you pay in, hoping that you don’t need it. It’s not a redistribution, it’s a pooling of risk. And that’s EXACTLY what Social Security was meant to do.

          Quite frankly, I think we should all be compelled to pay in and not necessarily be guaranteed a set payout–you should only get what you need for a basic level of security, not a slush fund in addition to your other retirement funds. If you think that people will draw down 401k’s and other retirement savings in order to get SS, you would be as foolish as those who think that people WANT to be on unemployment. It’s a far cry from real retirement (or, for unemployment, real employment) that no one wants to have to fully rely on.

          • Submitted by John Appelen on 07/28/2014 - 07:48 pm.

            Insurance to me is for things that one has little control over. And if one is a high risk, typically they pay higher premiums.

            In this case people apparently want low risk people (savers and investors) higher premiums and high risk people (spenders) lower premiums. So I don’t think it is insurance.

            • Submitted by Rachel Kahler on 07/29/2014 - 09:51 am.

              Insurance…to you

              Herein lies the problem. You don’t get to decide what the meaning is. The definition of “insurance” already exists. The definition is “a practice or arrangement by which a company or government agency provides a guarantee of compensation for specified loss, damage, illness, or death in return for payment of a premium.” Insurance requires only payment of a premium. What you believe to be additional requirements are your own opinions.

              There are a few definitions of “welfare.” One is: “the health, happiness, and fortunes of a person or group”. Another is “statutory procedure or social effort designed to promote the basic physical and material well-being of people in need”. A third is (specific to the good ol’ US of A political talk): “financial support given to people in need”. None of these definitions fit your apparent definition. That is, none of these definitions automatically means that welfare is the equivalent of free money.

              And, if you want to argue that “free money” applies to unemployment, we can have that conversation. You’d be wrong, but feel free to start it with some facts. I’ll start by saying that unemployment is paid for by payroll taxes. Though those payroll taxes are directed at employers, I’ll assert that the source is irrelevant, as employers regularly weigh the costs of an employee (including payroll taxes) with compensation and adjust compensation accordingly. That is, compensation to the employee is adjusted to account for payroll taxes. Thus, by virtue of being employed, an employee pays for his own unemployment insurance. If states must borrow from the Federal Govt. to make up for lack of funds, they must pay them back. That is, when unemployment is extended, it doesn’t become your version of “welfare.” It becomes a loan. The amount contributed per employee per year is a maximum of $42. That would be the premium. In periods of low unemployment, more money gets put into the coffer. In periods of high unemployment, the money is drawn down. Of course, since the effective rate is only 0.6% of each worker’s taxable wages, it would seem that we’re shooting ourselves in the foot by having 144 million Americans working minimum wages, eh? Especially since employment volatility in those positions is highest. Still, premiums are paid. And thanks to the fact that the unemployment insurance system in this country is non profit, it can be run this way. Yep, it’s a social welfare program, but it’s also a social insurance program.

              • Submitted by John Appelen on 07/29/2014 - 12:10 pm.

                So

                Of course welfare is not free money. It comes from people who pay higher income taxes and is given to people who pay little or no income taxes. Often with little in expectations as to what actions they will take to get off welfare. I support safety trampolines, not safety hammocks…

                Want longer unemployment insurance, raise the premiums up from .6%

                • Submitted by Rachel Kahler on 08/05/2014 - 03:08 pm.

                  Gosh!

                  They make safety trampolines?! I would totally support safety trampolines. I’m not so sure about safety hammocks. After all, unless they’re extremely high up, they’re pretty safe already. That would be redundant.

                  Of course, maybe you’re trying to suggest that the taxes I pay (being at a higher income) make people lazy. Having come from the “lazy” bracket, I can tell you that if that’s not a fiction, it’s a looooooooong stretch. And, in any case, just because you can use clever terms to suggest such a fiction doesn’t mean that you know what the solution is. You’ve done nothing but suggest (without any evidence, I might add) that people who are unemployment are lazy. Considering that you don’t just get unemployment for being unemployed (the requirements include, of all things, prior employment), on it’s fact that’s a ridiculous assertion, particularly without any facts to support it. Even, for the sake of argument, it wasn’t a ridiculous assumption, Even if you claim that “it’s because the participation in the work force has dropped,” it’s ridiculous. After all, people who have dropped out of the work force are not eligible for unemployment benefits. I’m not sure what your theoretical “safety trampoline” looks like. If it’s different from the current system, which seems to have bounced back (sitting at just under 7% nationally–the lowest since January 2009) as you would suggest by your terminology, how would you make it different?

                  The premium appears to be working just fine as it is. Sure, we could bump it up. I wouldn’t really be opposed to that if it could be shown necessary.

          • Submitted by John Appelen on 07/28/2014 - 07:56 pm.

            Unemployment benefits are paid for benefits.
            Extended unemployment benefits are a form of welfare without the low income requirements.

  28. Submitted by John Appelen on 07/25/2014 - 07:38 am.

    Savings

    A couple of people mentioned that we should encourage earlier enrollment to take advantage of receiving premiums from younger/healthier people. I think most of the premiums are paid via the payroll tax. If this is the case, the earlier people “retire” the earlier they stop paying premiums (ie FICA) and start taking money out of the trust fund.

    What am I missing here?

    • Submitted by Paul Udstrand on 07/25/2014 - 08:40 am.

      Missing two things

      1) We’re not saying people should retire earlier, we’re saying they should get enrolled earlier, or everyone should be on Medicare (national plan)

      2) The problem of enrolling young healthy people in order to collect premiums would be solved by automatic enrollment since as you point out, the funding come out of payroll tax, they work, they pay, done.

      • Submitted by John Appelen on 07/26/2014 - 12:27 am.

        Single Payer

        I assume you are recommending we adopt single payer?

        Not a fan of that.

        • Submitted by Rachel Kahler on 07/28/2014 - 02:10 pm.

          Why not?

          You could always purchase supplemental insurance if you wanted coverage for non-basic care (e.g., upgraded coverage). After all, you already pay more for more coverage, right? Or, wait, you already pay more for…uh…any coverage at all.

          • Submitted by John Appelen on 07/28/2014 - 07:51 pm.

            Canada

            That is a big debate in Canada. Should people be able buy “better” care.

            • Submitted by jason myron on 07/29/2014 - 10:58 am.

              Really?

              Debated by whom? I travel to Toronto frequently, have friends and coworkers there and haven’t heard one thing about it. In fact, the only thing that ever comes up in when healthcare enters the conversation is how the US can be so far behind the rest of the civilized world.

            • Submitted by Rachel Kahler on 07/29/2014 - 12:25 pm.

              Huh

              I hadn’t heard about that being a debate. Even so, you can purchase supplemental insurance to help cover things deemed unnecessary, such as a private room, elective surgeries, and cosmetic work.

            • Submitted by John Appelen on 07/29/2014 - 03:48 pm.

              One Source

              http://www.theglobeandmail.com/globe-debate/how-canadas-health-care-system-contributes-to-inequality/article17691727/

              • Submitted by jason myron on 07/29/2014 - 05:28 pm.

                Uhhh, okay

                that’s hardly a “debate.”

              • Submitted by Rachel Kahler on 07/30/2014 - 10:35 am.

                I don’t think it means

                what you think it means. In fact, it’s evidence that regressive tax structure around health care is a bad thing. And maybe the answer is single payer with unsubsidized private insurance being available. Here’s a quotation from the article:
                “We are more like the U.S. than the rest of the world in these respects, except that the Affordable Care Act (Obama Care), despite its flaws, aims to provide a much more comprehensive basket of medically necessary goods, including both prescription drugs and mental health treatment when required, and takes steps to counter the inequalities generated by unfair tax subsidies. These are first order problems with the Canadian system that need to be fixed.”
                It doesn’t say anything about /unsubsidized, supplementary/ private insurance being bad. Or even that there’s a question about whether or not private insurance should be able to provide better care. Rather, it suggests that private insurance that directly competes with services provided by public insurance drives up health care costs, which is exacerbated when private insurance is subsidized.

                • Submitted by John Appelen on 07/30/2014 - 12:08 pm.

                  Where the Money is

                  “There is evidence that physicians shift their time to the private system, resulting in fewer publicly funded services. And there is evidence that the cases left in the public system are most complicated and costly.”

                  http://medicare.ca/main/the-facts/dont-privatize-our-health-professionals

                  The reality is that people with money will pay more for healthcare. And the best medical professionals will usually follow them. Therefore with single payer it is important that everyone suffers equally. Then the well to do will work to pull up the whole system.

                  Unfortunately limiting the freedom of the middle class and wealthy to buy services they value is pretty un-American. So it is unlikely single payer will work very well here.

    • Submitted by Connie Sullivan on 07/27/2014 - 11:54 am.

      Your ignorance of how Medicare works (and I presume your ignorance also of how Social Security works) is appalling.

      Medicare beneficiaries pay monthly premiums. In addition to all the Medicare tax they paid during their active working years.

      Medicare is partially means-based: If you have a healthy, beyond-Social Security retirement income, your Medicare premium goes up. It doesn’t take much income for that to happen. The whole system is geared to providing all retirees with basic health care, and with a basic income

      That income is also means-based: Higher-wage workers receive higher Social Security benefits per month and per year. However, if you have any retirement income beyond Social Security, which most higher-wage workers do, you pay taxes on your Social Security benefits, with those taxes going right back into the SS trust fund.

      To advocate eliminating carefully-drawn plans like Medicare and Social Security in favor of charity-based insecurity in retirement is to deny social safety nets as a concept. I can think of nothing more selfish.

      • Submitted by John Appelen on 07/27/2014 - 10:27 pm.

        Support

        Hi Connie,
        So apparently you support the current use of means based testing to reduce the benefits received and increase the taxes paid for those who paid the most into the programs?

        Do you also support removing the cap like the rest of these commenters seem to? Thereby increasing the amount paid by those who pay the most already?

        By the way, I never said “charity based”…

        Now think of the benefits:
        – Low income people wouldn’t have to pay those high tax rates. (ie payroll taxes)
        – It would be perfectly means based, no one with significant savings would get a penny from the system.
        – People would need to spend their wealth before receiving benefits. Less need to worry about that pesky inheritence tax.

        • Submitted by Jonathan Ecklund on 07/28/2014 - 01:32 pm.

          Ah, yes, the ‘pesky inheritance tax.’

          The estate tax only applies to deceased individuals with an estate of 5.3 million, or couples with an estate of over 10 million in worth. 99.8 percent of American households don’t pay any estate tax. The estate tax is supposed to exist so that America isn’t saddled with a worthless caste of landed aristocrats.

          • Submitted by John Appelen on 07/29/2014 - 12:20 pm.

            Spend Aggressively

            Jonathan,
            Do you support people spending their money waste fully?
            Or do you support people saving and investing?

            Why would people save invest and create jobs just to give it to the government at their end of days? Would the death tax encourage you to work hard, save, invest, etc.

            Just curious.

            • Submitted by Karen Sandness on 07/29/2014 - 03:20 pm.

              Why would they care what happened to their money

              after they’re dead? It’s not as if their heirs will be sleeping under bridges with an estate of “only” $4 million.

              By the way, very few people with that kind of wealth got it merely by “working hard.” If hard work were the only road to wealth, then hotel maids and migrant farm workers would be the richest people in America. Some won the parental lottery–the Waltons and the Kochs and Mitt Romney, for example–while others just happened to get support from the right people at the right time or started out merely affluent and clawed their way to the top through cheating, bribery, treating their employees like slaves, driving all their competitors out of business, etc.

            • Submitted by Jonathan Ecklund on 07/29/2014 - 04:30 pm.

              I support the estate tax.

              Q: “Do you support people spending their money waste fully?
              Or do you support people saving and investing?”

              A: I support the estate tax. People can choose to spend or save the rest of their money as they see fit.

              Q: “Why would people save invest and create jobs just to give it to the government at their end of days?”

              You seem to be operating under the incorrect assumption that there is some magical machine that you put money in the top of, and out of the bottom come jobs. The idea that you just’ invest money and make jobs’ is provably false. I guess by that logic, Stuart Mills is a great job creator, But to answer your loaded question, I would imagine that people invest and save in order to spend money on things they need and want… like most humans do. When they die, they don’t really need it anymore. I guess that if you are motivated to not work hard because you won’t get to keep your money when you are dead, then you have some other issues you need to work through.

              Again, 99.8 percent of American households pay no estate tax… I number I quoted because you labeled the estate tax as ‘pesky,’ when it only affects .02 percent of the population. Something that only affects super-rich dead people doesn’t qualify as pesky in my book.

              Long story short, the estate tax would have zero effect on my fiscal and work habits were my wife and I worth over 10 million bucks.

              Or do you believe that “he who dies with the most toys wins?” Just curious.

  29. Submitted by Jon Lord on 07/27/2014 - 09:32 am.

    one other thing

    If we could somehow manage to get back all the jobs sent overseas, the manufacturing jobs especially, then the problem goes away for good. More people working, especially with better paying jobs means an increase in workers paying taxes and into FICA.

    Another way would be to tax companies for each job sent overseas.

    • Submitted by John Appelen on 07/27/2014 - 10:36 pm.

      Buy American

      To repeat myself as usual… The fastest way to bring jobs back is to spend your money on high domestic content products and services whenever possible. Preferably with American companies who hire more Americans for corporate and development jobs.

      Even if it costs ourselves a bit more. I mean if we are not willing to pay for those higher American benefits, American compensation and occasional repair bills, should anyone else?

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