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This piece offers and interesting twist on the whole Social Security Reform debate. Social Security overall has not worked for Black men and women thus a change to it, that has the possibility of helping us more than the current system should be welcomed. Black folk need to look deeper into what Bush is trying to do with Social Security and not simply listen to Democrats who are putting a spin on what is at stake. The changes Bush want to make can not work any worse for us than the current system, but of course politicians never give us the full story.

Barring the authors subtle but apparant racism it is an interesting piece.
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Would liberals support Social Security reform if they thought of it as reparations for blacks?

The current Social Security system disadvantages blacks for reasons related to their historic mistreatment. Private accounts would go some way toward addressing this legacy of discrimination "” as Democrats typically put it "” but the supposed fiercest advocates of black interests are precisely the ones who will stand in the way.

There is a direct correlation between economic status and average life span. This means that blacks, who are disproportionately poor, partly for historic reasons, tend to have shorter life spans, especially black males. The average life expectancy of a black male is roughly 68.6. The retirement age of Social Security is set under current law to eventually rise to 67. You do the math "” this cannot be a good deal.

According to Social Security expert David John of the Heritage Foundation, one-fifth of white males die between the ages of 50 and 70. But one-third of black males die between those ages. If you die before you reach the age of 62, you have no chance of collecting benefits, and if you die shortly thereafter, you will not recoup the payroll taxes you paid into the system.

John ran the numbers for persons roughly age 20 to 25 living in the ZIP code for liberal New York Rep. Charlie Rangel's district office. The average rate of return from Social Security for these young people will be negative 8 percent. If young blacks were being fleeced in this way by, say, "predatory lenders," the likes of Rangel would scream racism and demand change. But if they are financially abused by a liberal sacred cow, the implicit message is: Don't get uppity.

The current system has features that provide some protections for blacks. They disproportionately benefit from disability insurance, but that program won't be touched by reform. Also, when a worker dies, his children and/or spouse collect some benefits. The child gets benefits as long as he is under age 18 or not yet graduated from high school, although the closer to retirement age someone gets, the less likely he is to have a child under 18. A spouse gets benefits if she is married to the deceased at the time of his death or was married to the deceased for 10 years or more.

Under most reform plans, a private account will fund the same spousal benefit as in the current system, but the remaining balance will go directly to the deceased's family. In the current system, if someone dies and has no wife or children, the money he has paid in simply disappears. Under reform, the beneficiary would be able to designate who receives the assets in his account, whether it is a niece or a church. The money stays in the community.

This is so important because even as blacks have made up ground in terms of income "” their household income has increased roughly 47 percent since 1967 "” they lag badly when it comes to net worth. The median net worth for black families is only $19,000, a mere 15 percent of the same figure for white families. Blighted opportunities in the past have kept blacks from passing wealth from generation to generation.

Private Social Security accounts would help address this deficit "” if Democrats don't stop them. The dirty secret is that the political appeal of the welfare state is not primarily in helping the needy, but in larding benefits on middle-class voters. This dynamic is starkly evident in a system that docks the wages of low-income minorities to subsidize the retirement of wealthy, healthy, long-lived baby boomers.

Opinion polls have shown that roughly 60 percent of blacks support the idea of private Social Security accounts. If only their political advocates could see the light. They should think of the accounts as financial affirmative action, or any other government initiative meant to benefit blacks. According to the ideology of black victimhood, blacks are apparently owed everything "” except a better opportunity to save and own their own retirement assets.
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There are Negroes who will never fight for freedom. There are Negroes who will seek profit for themselves from the struggle. There are even some Negroes who will cooperate with the oppressors. The hammer blows of discrimination, poverty, and segregation must warp and corrupt some. No one can pretend that because a people may be oppressed, every individual member is virtuous and worthy. Martin Luther King

More to come later! Your Brother Faheem
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I'd like some insight on this issue as well. I'm automatically suspicious of any plan of Bush's that would involve people's money, the way I'd be suspicious of any plan of Michael Moore's (the filmmaker, not the webmaster) involving fitness and beauty.

I'm also suspicious of any plan that would give the finance industry's powerbrokers stewardship over such a staggering amount of money.

But I know something needs to change with soc. sec., if it's going to still be there in 25 years. And it really does rob people to have the government take out that money and not give us a competitive return on investment. If I had been able to keep the money they took out for SS, a good chunk of it would have gone right into employee investment accounts, and I'd have a considerable amount more money than I now have. So is this privatization something we should want?
quote:
Originally posted by Vox:

And it really does rob people to have the government take out that money and not give us a competitive return on investment.


The higher the return, the greater the risk associated with that investment. Ostensibly, the government offers a lesser return on investment because it _ensures_ the safety of those returns. Roll Eyes

quote:
If I had been able to keep the money they took out for SS, a good chunk of it would have gone right into employee investment accounts, and I'd have a considerable amount more money than I now have. So is this privatization something we should want?


For many/most, even with the SS money not removed from their paychecks they'd still be struggling to make ends meet. Without SS, poverty among the elderly would absolutely skyrocket.

I think there are a number of things that could be done to minimize the shortfall. First, it makes no sense that the wealthy, to whom SS means nothing, should still receive it. Take the total value of what they have accrued and give it back to them in a tax benefit. The government saves what it would pay out to them and the wealthy get a tax break for their investment over the years.
quote:
Originally posted by Faheem:

Come on people... I know some of yall understand this Social Security crap better than me, is Bush plan good for Black folk or bad....As of now.. my observation have me believing that any change to the current system can not be worse for Black men and women than what it is now.


I'm not sure what good private accounts are if the money might not be there when you need it. While the concept of earning higher returns is the primary benefit of privatization, that would inject considerably more risk into the scenario in the form of the potential for human error and fraud. It seems that either we believe that a system designed to help finance retirement is a good thing or we don't. If it's not the government's business to help folks in this way, then eliminate it. Personally, I think it is a wise program. The government just needs to stop screwing with it - i.e. stealing from it. As well, Bush needs to inject a bit of fiscal responsibility back into government. With a few tweaks, SS would be fine if there weren't mind numbing budget deficits.

As it relates to the primary issue why SS seems not to be benefiting blacks as much as others, unless they create a sliding scale for allowing ethnicities to draw on SS earlier based upon their specific mortality rates, then I believe Bush's plans are race neutral. They could do all sorts of things, but if we can't access the money because, on average, we're not around - then it is rather irrelevant to us.
Would the "private" in a private account system = a company like an ENRON or a WORLDCOM or one of those other companies what went bankrupt and left all those people without their retirement?? Confused

Based on this article, I don't see how Black folks could lose anything. At least not anything more than we have right now. There's something about this article that doesn't seem complete, though. I really don't know enough about all the details to give an opinion as to how good it really might be. But ... I certainly wouldn't consider it Reparations for Black folks. This wouldn't be giving us anything above what we already earn and deserve.
Kev -- Kind of like an FDIC for retirement funds. That makes perfect sense to me.

And MBM -- I hear what you're saying, and I don't know where I stand on this issue. But you have to keep in mind that monies invested in the general stock market over your working lifetime always outperform what they do in SS. There are always periods of significant downturn, but of all investment vehicles, the stock market has been the best performer over the long-haul course of the period you'd be putting into social security -- 40-50 years in most cases -- you make a killing in the stock market. And this even factors in Enron & companies like that.

But when allowing Wall Street to manage that much money, I can't help but worry that the cost to administer this privatization fund would eventually skyrocket, eating heavily into investment profits. Any insight on that?
Well, it's kind of like suggesting that the police function could be managed better through privatization. Whether you actually agree with that or not, it just raises all sorts of conceptual issues about the role of government. Again, if it is in the public interest to ensure a financial floor for retirees - then do you really want to fool around with it in the way that privatization opens the door to. The one thing about the government, at the end of the day (and with enough political pressure) they can just print more money and take of the whole thing. Merrill Lynch, obviously, can't do that.

I'm really intrigued with the broader question about the role of government on this though. Maybe it isn't the government's business whether retirees have income or not. We should debate that (the appropriate role of govt.)sometime.

And again, if the issue is how this all is relevant to black folks - if we're not around to collect the privatized, higher returns, then who cares? Maybe we should be pushing for an earlier "draw down" date?
I think, I think, that this entire discussion of comparative benefit of plans is a ruse to disguise the actual intent of the plan.

Money.

I don't know the value of the Social Security fund. I would guess it to have, at least, 12 zero's. Maybe 15.

A 6% broker's fee would have a high of 13 zero's!!!

This income would not include any fees for 'ancillary services.'!!!

The financial industry wants to get its hands into the cash flow of Social Security. They could care less what it is called, how it is described, or who gets credit.

Gimme the money.

PEACE

Jim Chester
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quote:
Originally posted by Faheem:
Come on people... I know some of yall understand this Social Security crap better than me, is Bush plan good for Black folk or bad....As of now.. my observation have me believing that any change to the current system can not be worse for Black men and women than what it is now.


Any type of privatization if it is indeed private accounts IN YOUR NAME is a plus.

Just count about the billions as noted in the article that has been lost to the black community for generations since:

When you die off all your money stays with the gov't. You don't get to will it to your kids, family, mom, significant other or whoever.

Originally there was a lockbox but the law was changed in the 1960's or 1970's so that it could be raided and replaced basically with an IOU from Congress.

Will have to check on the exact date on that.

But that's the problem of gov't handling your money: the gov't is people and by definition corrupt.
quote:
Originally posted by Vox:
Kev -- Kind of like an FDIC for retirement funds. That makes perfect sense to me.

And MBM -- I hear what you're saying, and I don't know where I stand on this issue. But you have to keep in mind that monies invested in the general stock market over your working lifetime always outperform what they do in SS. There are always periods of significant downturn, but of all investment vehicles, the stock market has been the best performer over the long-haul course of the period you'd be putting into social security -- 40-50 years in most cases -- you make a killing in the stock market. And this even factors in Enron & companies like that.

But when allowing Wall Street to manage that much money, I can't help but worry that the cost to administer this privatization fund would eventually skyrocket, eating heavily into investment profits. Any insight on that?


As long as it's invested in an index fund of the appropriate type ie well diversfied past on a mathematical formula.

That's why you have less costs for investing in say an index fund for NASDAQ or NYSE then a mutual fund for the same thing although both are essentially the same.

One uses a mathematical division of the money thru say the top 500 companies on an exchange no matter what they are whereas with a mutual fund you have more money managers etc.

As long as it's diversified enough a good idea.
JWC is exactly correct. This pritization of SS is merely a grab by the financial industry. It argues me that, here again, the left has allowed the right to control the debate through half-truth and out-right lies.

The purpose of SS was never about transfering wealth to people; rather, it was to prevent people from living there non-working days in absolute poverty. It was a contract between the working generation to care for the non-working generation. It was our societal choice that we are our brother's keeper.

I suggest everyone with questions about SS and privitization start by googling Paul Krugman and SS. I also suggest that before anyone gets too excited about the coming retirement nestegg windfall, that they research the experiences those countries that actually offer privitization as an option, such as Brazil. In short, the numbers show that those selecting privitization did well doing the stockmarket run up of the 90's, but since are fairing far worse than those that opted for the traditional plans. And, guess who supports those gamblers now? That's right ... the government, through other transfer payments.

But the right, at least, has that problem solved. They're doing away with the transfer payments first. So when the market falls at the initial run up caused by the infusion of billions in "new" money, the losers, i.e., Trusting Joe Average American, will have nothing to fall back on.

This reminds me so much of the "Is this your wallet with the $2,000 check written out to CASH in it that I just found? No? Well, I don't have time to cash the check, but I'll give you the check to cash, if you'll give me ... Oh ... $1,000 now" con. The right is playing to our greed. DON'T PLAY.
Information to combat the lies and half-truths. More to follow.

Bush's "Piratization" of Social Security

January 11, 2005
By Vermeer

Bush is siccing the investor class on the worker class.

Which are you? If you make more of your income from work than you earn from investments, you are part of the worker class; if you make most of your income from investments, you may be part of the investor class - unless, of course, you are retired and are no longer earning income from current labor.

Clearly the big Wall Street investment companies that contribute heavily to Bush's and other Republican political campaigns stand to gain billions of dollars from fees and commissions if Bush manages to "piratize" Social Security. No, I did not misspell "privatize," I spelled it "piratize" because the root word here is pirate.

If you are middle-class or poor and support Bush's "piratization" of Social Security, you have been brainwashed and bamboozled. If you work for a living and support Bush's "piratization" of Social Security, you have been brainwashed and bamboozled.

Social Security is not broke or going broke, and Bush's "piratization" plan for Social Security will harm all but the wealthy and elite investor class. Let's discuss "insider trading": Bush will undoubtedly relax or remove the regulations barring Wall Street insiders from profiting from "insider trading," and where will the ordinary investor be then? Out in the cold, and broke.

Social Security is not in crisis; it is the healthiest government program ever. It is solvent and will be solvent for the next 75 years - and beyond, if the Bushites will just stop robbing money from the Social Security trust fund which is generating surpluses in excess of $150 billion a year.

For 20 years, we have been paying extra into Social Security to provide for the baby boomers' retirement years. It was Ronald Reagan, at the urging of Alan Greenspan, who increased Social Security taxes just to provide for the coming retirement of the baby boomers. It is beyond gullibility to believe lawmakers just recently woke up and discovered the baby boom generation will start retiring soon. We have been paying extra into the Social Security trust fund for 20 years to provide for them.

Currently, there is a surplus of $153 billion more per year flooding into the Social Security trust fund than is being paid out to retirees.

Leading economists, and the Congressional Budget Office, tell us that even if Congress does nothing, the Social Security trust fund will not run out of funds until 2052. Even then the system will not be bankrupt and, by using then-current revenues, Social Security will be able to pay retirees 80 percent of their promised benefits. That's if Congress does nothing at all. [Source: Congressional Budget Office Report "The Outlook for Social Security"]

The "fix," if one is needed, is simple and fair. Raise the ceiling on the income taxable for Social Security. Americans at the upper income levels have benefited the most from Bush's past tax cuts and can easily afford to pay a bit back into Social Security, which they also receive at retirement.

Social Security is not only far from bankrupt, it is the most successful and most scandal-free government program ever, and the administrative costs - less then 1% - to run it are far below what Wall Street will charge investors for private accounts. The investment houses have profit as their goal, whereas Social Security is an insurance policy to protect Americans from the vicissitudes of the stock market.

Be warned - we are about to be treated to the same lying prelude to destroying Social Security that we were treated to in the buildup to the Iraq war. The Iraq war buildup was done with smoke and mirrors and threats of "mushroom clouds" over Manhattan. The Bushite effort to destroy Social Security will be as full of lies and scare tactics as the buildup to invading Iraq was. Americans of all ages must be on guard against the lies the Bushites will tell, and have been telling for years.

Bush and other Republicans are being profoundly dishonest when they claim Social Security is going broke; it is not.

So, what is the problem? Bush has been "borrowing" from the Social Security trust fund in order to wallpaper over the fact that he cannot or will not balance the federal budget. He has been giving tax cuts to the wealthy but has not been cutting the amount the government spends. America is spending more than it is collecting in revenue. What happens when people spend more than they take in? Most go into debt.

The difference between Bush and the American people, though, is that when he wanted to give even more tax cuts to the wealthy elite - and hide from the American people the extent to which he was mismanaging our economy - he simply took the money from the Social Security trust fund. True, he left some I.O.U.s in the "box" to acknowledge what he had done - but now he doesn't want to pay back what he has borrowed.

So, what is his solution? He tells us Social Security is going broke and must be destroyed.

Think of it this way: You have spent more than you earn each year and have borrowed to the hilt from your neighborhood bank. Now the moment has come for you to start paying back what you owe the bank, but you still don't have sufficient finds to do so, because you are sending money to your rich Uncle and Aunt (in hopes they will mention you in their will). What can you do? If you are George W. Bush you simply blow up the bank, and the problem is solved.

Bush owes Social Security more than he is willing to pay back, and (in the expectation they will fund his ideological battles) he continues to give his rich corporate "aunts" and "uncles" more and more tax breaks - and is betting he will be able to blow up Social Security.

Bush is amassing a war chest to fund an advertising blitz that will hypnotize Americans into believing him when he says Social Security is in crisis. There is no similar effort possible among Social Security's defenders, because most of those who need and rely on Social Security cannot afford to donate huge sums to sponsor ads telling the truth: that Social Security is not in crisis and is not going broke. On the other hand, the Wall Street investment houses - eager to gather in billions, if not trillions, of dollars in profits from fees and commissions - are more than energized to spread Bush's deceitful message.

It is up to all of us to make sure George W. Bush does not get away with this horrendous deception.
The Bush administration is merely attempting to play on America's ignorance and fears in order to set up his friends and flunkies into multi-million/billion dollar government contracts, the same way the played on America's ignorance about Iraq and fears of "threats" by terrorists to invade Iraq in order to set up his cronies with lucrative government contracts. Social Security is only Bush's next "invasion." If they privatize social security, just how do you think that will happen, without a replacement private beauracracy? Or multiple private beauracracies?

Do Americans really trust private commission driven individuals to be in charge of Social Security (and the way most business make money is by not spending any more than necessary) it would result in seniors who have worked for 30-50+ years living on $200.00 a month after retirement, and living on nothing after one or many of the private companies that would run social security pull an Enron on the American people in general (you do know that most white collar crimes only come with fines and sanctions and not necessarily criminal sentences for wrong doing). so, what would keep them from shafting the public?---Which is all this Administration has been doing from the beginning, beginning with stealing the election----who in the hell would trust anyone/people who would spit in the face of our constitution the way this administration has with our future?
Bush pisses me off to no end. He screws us, then tries to sell us on his policies citing the fact that we get screwed more than others as rationale. bs MBM

Bush talks issues with black leaders
To meet with Congressional Black Caucus on Wednesday



WASHINGTON (AP) -- President Bush told black leaders Tuesday that his plan to add private accounts to Social Security would benefit blacks since they tend to have shorter lives than some other Americans and end up paying in more than they get out.

Social Security was one of many issues that came up during Bush's private meeting with 14 clergy and 10 leaders from business and nonprofit groups.

Exit polls showed that Bush received just 11 percent of the black vote in November's election, a slight increase over the 9 percent he received four years earlier.

Bush and his strategists are under no illusions of winning the black vote for Republicans in the near future. But they believe that any advances on this and other minority voting blocks could make the difference in close elections.

Bush planned to meet with the Congressional Black Caucus, a group of 43 Democrats, on Wednesday. The caucus had an adversarial relationship with Bush in his first term, but Rep. Melvin Watt, D-North Carolina, the group's new chairman, said members are hoping to find common ground with Bush in his new term.

Many of the people at the meeting with Bush Tuesday were the president's political supporters. Attendees said Bush promised more trade with Africa and support for home and business ownership by blacks. They also said his supporters in the room praised Bush for opening federal dollars to churches and religious organizations and encouraged him to push for a constitutional ban on gay marriage.

Bush said this month it will be virtually impossible to overcome Senate resistance to passing an amendment under current legal conditions.

"We felt very strongly that we hope that the president would make this a priority on his agenda," said Robert L. Woodson Sr., founder of the Washington-based National Center for Neighborhood Enterprise. Woodson said many black pastors encouraged their congregations to vote for Bush on the issue, but Bush didn't respond to the request. "He was noncommittal on it because he has more priorities," Woodson said.

Perhaps his top domestic priority currently is to overhaul the Social Security system. Although he has not revealed details of his plan, he wants to let younger workers invest a portion of their Social Security taxes to private investment accounts in exchange for a reduction in future guaranteed benefits. The administration says retirees or those near retirement age would not have their benefits reduced.

Michelle Bernard, senior vice president at the Independent Women's Forum, a Washington-based group that opposes traditional feminist ideology, said Bush stressed that he does not want to abolish Social Security, only mend it.

"There was a lot of discussion about how the Social Security system as it stands today has a negative impact on African-Americans simply because, regardless of your education background or socio-economic level, African-Americans tend to have a shorter life expectancy than others," she said.

Democratic congressional leaders are united against Bush's idea to overhaul the system, and some Republicans have said they are reluctant to change a program that tens of millions of Americans rely on for retirement security. They are urging Bush to sell the idea to the public so they can get behind it politically, and the meeting with blacks was part of the White House effort to build support.

"African-American males have a -- have had a shorter life span than other sectors of America," said White House press secretary Scott McClellan. "And this will enable them to build a nest egg of their own and be able to pass that nest egg on to their survivors."
Klugman, again, takes on the administration's lies in a recent editorial. I've snipped the main points; but I'll post a link if anyone wants it. Just let me know.

, Mr. Bush's remarks on African-Americans perpetuate a crude misunderstanding about what life expectancy means. It's true that the current life expectancy for black males at birth is only 68.8 years - but that doesn't mean that a black man who has worked all his life can expect to die after collecting only a few years' worth of Social Security benefits. Blacks' low life expectancy is largely due to high death rates in childhood and young adulthood. African-American men who make it to age 65 can expect to live, and collect benefits, for an additional 14.6 years - not that far short of the 16.6-year figure for white men.

Second, the formula determining Social Security benefits is progressive: it provides more benefits, as a percentage of earnings, to low-income workers than to high-income workers. Since African-Americans are paid much less, on average, than whites, this works to their advantage.
Bush's slanted sales pitch

Social Security is not unfair to blacks

January 28, 2005

President George W. Bush tried to win support from black Americans for private Social Security investment accounts this week by arguing that blacks are shortchanged by the current system because they don't live as long as whites. It's a specious argument that doesn't withstand scrutiny.

Black people actually receive a higher rate of return from their investment in Social Security than others when the full range of retirement, survivor and disability benefits are considered, according to a 2003 government study cited by the Congressional Black Caucus Foundation.

Bush got it half right in his White House meetings with black leaders and members of Congress. The life expectancy for blacks is 72.3 years compared to 77.7 years for whites. The disparity is even greater for black men, whose life expectancy is 68.8 years versus 75.1 years for white men.

With the Social Security retirement age slated to rise to 67, it would appear that black men would have little chance of collecting benefits. But the image of black men working and paying payroll taxes for a lifetime and then dropping dead en masse at 68.8 is simplistic. Those who die young die really young, having paid little into Social Security.

But for those who reach retirement, the disparity in life expectancy narrows dramatically. Black men who reach age 65 live, on average, to be 79.6; comparable white men soldier on only two more years to age 81.6.

In addition, the current Social Security system is progressive. Lower wage earners - a category in which blacks are overrepresented - receive benefits that replace a higher percentage of pay than high earners. Then there are those disability and survivor benefits. Blacks are 13 percent of the population, but 17 percent of those collecting disability benefits and 23 percent of children receiving survivors benefits.

Blacks, like all Americans, need to save more. But the notion that the current Social Security system shortchanges them is just wrong.

Copyright © 2005, Newsday, Inc.
quote:
Originally posted by Kweli4Real:
Klugman, again, takes on the administration's lies in a recent editorial. I've snipped the main points; but I'll post a link if anyone wants it. Just let me know.


This is the piece in its entirety.
The New York Times
January 28, 2005
OP-ED COLUMNIST
Little Black Lies
By PAUL KRUGMAN


Social Security privatization really is like tax cuts, or the Iraq war: the administration keeps on coming up with new rationales, but the plan remains the same. President Bush's claim that we must privatize Social Security to avert an imminent crisis has evidently fallen flat. So now he's playing the race card.

This week, in a closed meeting with African-Americans, Mr. Bush asserted that Social Security was a bad deal for their race, repeating his earlier claim that "African-American males die sooner than other males do, which means the system is inherently unfair to a certain group of people." In other words, blacks don't live long enough to collect their fair share of benefits.

This isn't a new argument; privatizers have been making it for years. But the claim that blacks get a bad deal from Social Security is false. And Mr. Bush's use of that false argument is doubly shameful, because he's exploiting the tragedy of high black mortality for political gain instead of treating it as a problem we should solve.

Let's start with the facts. Mr. Bush's argument goes back at least seven years, to a report issued by the Heritage Foundation - a report so badly misleading that the deputy chief actuary (now the chief actuary) of the Social Security Administration wrote a memo pointing out "major errors in the methodology." That's actuary-speak for "damned lies."

In fact, the actuary said, "careful research reflecting actual work histories for workers by race indicate that the nonwhite population actually enjoys the same or better expected rates of return from Social Security" as whites.

Here's why. First, Mr. Bush's remarks on African-Americans perpetuate a crude misunderstanding about what life expectancy means. It's true that the current life expectancy for black males at birth is only 68.8 years - but that doesn't mean that a black man who has worked all his life can expect to die after collecting only a few years' worth of Social Security benefits. Blacks' low life expectancy is largely due to high death rates in childhood and young adulthood. African-American men who make it to age 65 can expect to live, and collect benefits, for an additional 14.6 years - not that far short of the 16.6-year figure for white men.

Second, the formula determining Social Security benefits is progressive: it provides more benefits, as a percentage of earnings, to low-income workers than to high-income workers. Since African-Americans are paid much less, on average, than whites, this works to their advantage.

Finally, Social Security isn't just a retirement program; it's also a disability insurance program. And blacks are much more likely than whites to receive disability benefits.

Put it all together, and the deal African-Americans get from Social Security turns out, according to various calculations, to be either about the same as that for whites or somewhat better. Hispanics, by the way, clearly do better than either.

So the claim that Social Security is unfair to blacks is just false. And the fact that privatizers keep making that claim, after their calculations have repeatedly been shown to be wrong, is yet another indicator of the fundamental dishonesty of their sales pitch.

What's really shameful about Mr. Bush's exploitation of the black death rate, however, is what it takes for granted.

The persistent gap in life expectancy between African-Americans and whites is one measure of the deep inequalities that remain in our society - including highly unequal access to good-quality health care. We ought to be trying to diminish that gap, especially given the fact that black infants are two and half times as likely as white babies to die in their first year.

Now nobody can expect instant progress in reducing health inequalities. But the benefits of Social Security privatization, if any, won't materialize for many decades. By using blacks' low life expectancy as an argument for privatization, Mr. Bush is in effect taking it as a given that 40 or 50 years from now, large numbers of African-Americans will still be dying before their time.

Is this an example of what Mr. Bush famously called "the soft bigotry of low expectations?" Maybe not: it isn't particularly soft to treat premature black deaths not as a tragedy we must end but as just another way to push your ideological agenda. But bigotry - yes, that sounds like the right word.
A long read, but it has some good info and stats




President Bush with Robert McFadden, who spoke about Social Security and his father, earlier this month in Washington. (Reuters Photo)


Bush argues his Social Security plan aids blacks
By Michael Kranish, Globe Staff January 30, 2005


Second in a series of occasional articles examining the economic and political stakes involved in the Bush administration's proposed overhaul of Social Security.

WASHINGTON -- As President Bush prepares to accelerate his sales pitch for overhauling Social Security, he is increasingly wrapping his rhetoric in racial terms. The system, he argues, is ''inherently unfair" to many blacks.

The solution, Bush says, is to embrace his plan for private accounts, details of which he may provide in his annual State of the Union address Wednesday.

Under a system based on wages, the average monthly Social Security retirement benefit received by African-Americans is $775, compared with $912 for whites. In addition, many blacks never receive the benefits because a disproportionate number die before they are eligible. On average, black males die six years sooner than white males.

But some groups representing African-Americans say that Bush's logic is faulty and that creating private accounts would hurt blacks rather than help them. They maintain that Bush is playing a race card to boost his plan.

Representative Charles B. Rangel, a New York City Democrat who was among black members of Congress who met with Bush last week, said he is ''really offended" that the White House and some Republicans are trying to sell Bush's plan for private accounts on grounds that it would be more beneficial to African-Americans.

''It is one of the cruelest things that I have ever read, and I regret that it comes from the office of the president," Rangel said. If Bush wants to do something about inequities between the races, Rangel said, he should address issues including the lack of access to healthcare among many blacks, higher unemployment, and lower wages. Rangel added that unless blacks have better economic prospects, private Social Security accounts will not help them.

''I told the president, 'You can't get out what you can't put in,' " he said.

Whichever side is right, the controversy has put a spotlight on what some say has been missing in the national discussion over Social Security: Is the system filled with inequities that discriminate against certain demographic groups?

Advocates for gays and lesbians, for example, say they are treated unfairly because the federal government does not recognize civil unions or same-sex marriages, and thus does not pay survivor benefits to partners. This could amount to a loss of more than $1,000 a month to a surviving partner. The system is also under fire for its treatment of unmarried retired women, particularly African-American women. This group faces poverty rates among the nation's highest, even with Social Security benefits, according to a Social Security Administration study.

The question of whether the system is tilted against blacks has become a central argument in the debate over private accounts. The White House strategy for selling the idea of private accounts includes an effort to win over African-Americans, on grounds that black males, on average, die at age 69, compared with 75 years for white males. Social Security's full retirement benefits begin to be paid between age 65 and 67.

Bush, at a forum on Jan. 11, said: ''African-American males die sooner than other males do, which means the system is inherently unfair to a certain group of people. And that needs to be fixed."

The president appeared at the Washington forum with an African-American, Robert McFadden of New Jersey, who said his father died at 57. He said all that the family received after his father's death was a $255 check to help with burial expenses.

McFadden's father was too young to have received retirement benefits, and his brother was in college and did not qualify for survivor benefits, which usually are given to children until they graduate high school or turn 18.

''I don't think people realize how painful it is to receive a check like that and have a child in college," McFadden, a Republican and a Bush supporter, said in a telephone interview. ''That is why I think the president is suggesting people have an option" for private accounts.

Maya Rockeymoore, who has studied the issue at the Congressional Black Caucus Foundation, said Bush's plan for private accounts is not a good solution. The average age of death for blacks, she said, is earlier than for whites because homicide, poverty, and a lack of health care kills many black men at a young age.

She also said blacks get a higher return on benefits for the disabled and survivors. While blacks make up 12 percent of the population, they account for only 8.1 percent of those receiving direct retirement benefits. But blacks make up for that deficit by collecting more from other parts of the program -- the benefits for disabled persons and survivors, Rockeymoore said. African-Americans account for 18 percent of those receiving Social Security disability payments and 23 percent of children receiving survivor benefits, she said.

Rockeymoore said Bush's proposal for private Social Security accounts was flawed because many blacks' low incomes would prevent them from contributing significantly. Asserting that some proposals call for cutting benefits in addition to the creation of private accounts, she said that the plan would hurt many blacks.

''He would be dealing with health care if he really cared about it," Rockeymoore said, when asked about Bush's comment that the Social Security system is inherently unfair to blacks. Rockeymoore said Bush is ''playing a race card" as ''an excuse to change the system for their own narrow ends."

She noted that the Census Bureau says 11 percent of whites do not have health insurance, compared with 20 percent of blacks.

Generally, whites have a significantly higher average monthly retirement benefit than blacks because they had higher wages. Social Security payments are based on wage history, although there are adjustments to compensate for some of the difference.

A White House official denied that Bush is playing a race card and said the president is pushing a program for health insurance tax credits, as well as tax cuts to stimulate the economy. The official did not say whether Bush plans to cut future Social Security benefits because the president has not unveiled his plan.

Jeffrey Liebman, an associate professor of public policy at Harvard's John F. Kennedy School of Government, has studied the issue of whether blacks are treated unfairly by Social Security. He has concluded that blacks and whites receive roughly the same return on payroll taxes.

Agreeing with Rockeymoore, Liebman said: ''Black retirees on average receive benefits for fewer years than white retirees. But blacks are benefited by the current system because low earners get a higher return on their payroll taxes and because blacks are more likely to receive disability and young survivor benefits."

Liebman also disputed Bush's assertion that his plan for private accounts would make the system more fair to blacks. Even with the accounts, the same disparities between whites and blacks would exist, he said. Liebman, a former adviser to President Clinton, favors a plan for adding private accounts on top of Social Security, not replacing part of the existing system.

Advocates for gays and lesbians, meanwhile, say they are discriminated against because the federal government does not recognize same-sex marriages or civil unions.

An analysis by the National Gay and Lesbian Task Force presented a case study in which the denial of joint retirement benefits costs a typical same-sex couple $500 per month and the denial of survivor benefits costs the survivor $1,224 per month. ''For couples who are paying into the system their whole lives, if one dies before retirement age, it is unfair that their partner can't get the same benefits," said Sean Cahill, head of the body's policy institute.

A Social Security spokesman, Mark Lassiter, acknowledged that based on federal law, including the 1996 Defense of Marriage Act, the agency must deny any application for survivor benefits from a gay partner. The benefits ''are not payable based on a gay marriage," Lassiter said. He said he did not know of any case in which a same-sex survivor has applied for benefits. Advocates for gays and lesbians said it seems inevitable that there will be a court test.

The Democratic National Committee is on record as supporting benefits for same-sex partners. A White House official said Bush, who backs a ban on same-sex marriage, does not support such benefits for gay and lesbian partners.

Analysts said some inequities in the Social Security system have developed because the program was designed for the 1930s, when women usually remained at home and most people did not have significant assets. As a result, the system pays benefits based only on work history, not on wealth. Indeed, a multimillionaire whose wealth is based on investments, not salary, could be given extra money by the Social Security system, which assumes that a person with a lower wage history needs extra benefits.

''Social Security is a one-size-fits-all and it doesn't take into consideration changes because of income levels, gender, and many other things," said David John, who studies the issue at the conservative Heritage Foundation.

An article on this topic appeared in the Globe of Jan. 14.

Michael Kranish can be reached at kranish@globe.com
''Social Security is a one-size-fits-all and it doesn't take into consideration changes because of income levels, gender, and many other things," said David John, who studies the issue at the conservative Heritage Foundation.---David John

This quote from an analyst for the Heritage Foundation sums up the double-talk.

Everyone has the same percentage of their paycheck withheld for Social Security contribution.

The percentage is based on the same maximum number of dollars.

Everyone does not get the same size paycheck.

But, dollar for dollar, no one pays more into the fund than anyone else.

Playing a game of 'unfairness' based on any other premise is pure trickery.

This is the same game that got him into Iraq.


PEACE

Jim Chester

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