The Senate Finance Committee heard testimony on five different Social Security reform plans today. And ladies and gentlemen, we have one clear winner.
Two of the plans are tax increase non-starters that don't even include personal accounts. In fact both plans, by Peter Oszag of The Brookings Institution and Joan Entmacher of the National Women's Law Center spent all their time beating the same drum about how awful it would be to allow people to own their own Social Security only to finish up with a quick line about soaking the rich. You can read their plans here and here, if you must.
Two plans urge establishing personal accounts but fall short by advocating benefit cuts. Doing this just doesn't make any sense politically. Again, if you are as masochistic as you are ambitious, these two are here and here.
Only one plan shows an understanding of how personal accounts provide a better deal for workers and sustains the system permanently (and includes a neat wrinkle that calls for reduced government spending, which everyone claims to want). Peter Ferrara, Senior Fellow at the Institute for Policy Innovation. This one is worth reading and the link is here.
The Social Security Trust Fund has as much money in it as Jonathan Miller's Unclaimed Property Fund. Zero. In 2018, (less than thirteen years away if you are keeping score) we will have to dig into other programs or raise taxes to meet current obligations of Social Security. If we do nothing, present law dictates that benefits be cut 28% when Social Security can't pay all its own obligations. The "there is no crisis" crowd can't be allowed to win this one.
It is time to engage.