The People’s Plan
During his inaugural address President Bush called on Americans to help deliver some of the answers to change Social Security. I feel I have a valid solution and plan to set it forth in this letter to America. But before I lay out the plan lets look at a few facts.
If you define “bankrupt” as not being able to pay your obligations in full, then you might argue Social Security will be bankrupt come 2042, using projections from the Social Security trustees, or 2052, using estimates from the Congressional Budget Office. Using this same argument on America we don’t have to wait till the year 2042 or 2052…We are already BANKRUPT. Following the Presidents thought process we should toss out our current government and create one for the new millennium. Actually, he may have something here!
Social Security is a wonderful program designed to take care of the hard working, sometimes less fortunate Americans. Over the Last 20 years it has taken in more money than it has paid out. This is what has allowed for a surplus to be built up. This surplus has been lent out for other ventures and in 2018 Social Security will have to demand that the US government pay back its loan to Social Security. The reason for this is that when Social Security projects, the system will have exhausted its surplus. If the Government is allowed to default on their loan from your Social Security benefits, the company (the United States) becomes more profitable. With the loan repaid to Social Security, the current system would still be taking in enough revenue to cover 75 percent to 80 percent of what is currently promised for the next 40 years.
To bring into balance the $11 trillion dollar deficit that President keeps pointing out as a result of projections made by the Social Security trustees, the payroll tax would have to have to be increased by 1.89 percent. This would take payroll deductions from 12.4 to 14.29 percent.
According to the bureau of labor statistics, the average hourly rate in the US is $13. An increase of just 12.5 cents an hour (from both the employer and employee) would save Social Security for an additional 75 years. So by these calculations it is very easy to see that Social Security is not bankrupt and can be fixed very easily.
If we switch to personal savings accounts as outlined by President Bush’s plan and would retire in 17 years, our benefits would be reduced by a mear 10 percent. If you would retire in 37 years that amount would be reduced by about 25 percent. Your children and grandchildren would see their benefits diminish by almost 46 percent.
I agree with President Bush that we shouldn’t put a band-aid on a potential problem. I also feel that if your child breaks their leg you obviously don’t just toss them away. Additionally, you don’t take a faltering policy and replace it with another one. My grandfather is a retired Brigadier General. He has taught me much over the years and one of those things is, “all of us together are smarter than any one of us alone”. I call this plan “The People’s Plan” as it was derived from a single thought and input from countless Americans from every walk of life. The program is probably not perfect and would require bipartisan approval and the willingness of all politicians, including the president, to let the American People continue to shape this plan and take credit for its creation. In addition to saving Social Security, “The People’s Plan” will allow for the rollback of the tax cut, address the overactive participation of special interest groups in Washington and build a better America.
The plan is simple and cost effective to all. Here it is:
All Americans will continue to contribute to Social Security at the same rates they currently are contributing. In line with President Bush’s idea, 5 blind trust funds will be created. American workers will be able to contribute money into these (PSF) Private Saving Funds. Their contributions to these funds would be tax-free as they are taken directly from their paychecks. This portion would be administered the same way as withholding taxes are currently managed. The amount to be contributed to your PSF could not exceed $1000 a week. As one might figure, the wealthier Americans will contribute at a higher rate. Because recent tax cuts address the wealthiest Americans, this would allow them to still have the tax savings while rolling back the tax cut.
Come retirement, those Americans with assets above $1 million dollars or an annual cash flow of $100,000 dollars or more would draw no Social Security benefits. You might say this is not fair but let me explain. My grandfather, who I mentioned earlier, is pretty well off. He lives in an expensive house, has great benefits and several pensions. He continually complains that having to accept his Social Security check puts him in a higher tax bracket. By not receiving Social Security benefits, America’s wealth can cut taxes and pass that money back into the system. With fewer Americans withdrawing, SS funds remain higher longer. To compliment this set-up, a system would have to be set up that would allow full benefits to be paid to those needing it most and reductions for those who are more fortunate. At this point some folks may be thinking it should be called the Mother Therese or Robin Hood Plan. Either way it allows for all Americans to retire comfortably for the contributions they have made to the country over the years. Should a person’s fate change over the term of their retirement, the benefits would go either up or down!
The last part of this program would do away with special interest groups in Washington. This is the part that our President and representatives will like least. Let me foreshadow what I am about to propose with this:
All across America people make choices in their careers. Retail workers give up weekends and nights, sanitation workers deal with smelling other people’s trash for better wages, school teachers accept that they will have a reduced lifestyle because they love working with kids, ski instructors accept that they will have no benefits, low wages and work in sometimes adverse weather conditions in order to do what they love. A stay at home mom or dad knows that they are giving up a lucrative career to ensure that they are there for their family. Firefighters, police officers and the men and women of the Armed Forces put their life on the line to do what they love and to help others. Every American worker gives up something as part of the career they choose. It is my proposal that our representatives in Washington shall ONLY partake in the blind PSF program for all of their investments. That is, they shall hold no publicly traded stocks, bonds or market funds. This rule shall remain in effect during their service in Washington and continue for a period of 15 years after retirement from public office. With large corporations pulled from the pockets of Washington, special interest groups will carry the same voice as everyday, hardworking Americans.
As promised, “The Peoples Plan” allows for the rollback of tax cuts while still allowing every one to get a tax break by investing additional money toward their retirement. This rollback will allow America to help pay down our overextended debts and unplugs special interest groups from Washington’s pockets while giving President Bush his Special Saving Accounts. Most of all it saves social security and provides a better life for ALL AMERICANS.
PS I am taking this plan to the American public. I have notified the press that the President, leaders of the house, senate and both parties as well as ALL of the representatives from Connecticut and a hand full of other states have been given this information and NOT one of them has taken an interest…. It is obviously time to replace self-centered interest group driven politicians with those that are there to serve the public!!
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