KERRY'S SECRET PLAN
July 30, 2004
It appears that Sen. John Kerry has a secret plan to cut all government programs except for Social Security by 20 percent, says Sean R. Tuffnell (National Center for Policy Analysis).
Social Security faces deep challenges, says Tuffnell. We are living longer and having fewer kids. This means the pool of retirees collecting benefits is increasing while the number of those paying into the system is shrinking:
- In 1940, there were 42 workers per retiree; today the ratio is 3-to-1 and by 2050 it will be 2-to-1.
- The burden on each individual worker will increase substantially and we will no longer be able to keep our promises to retirees at current payroll-tax levels.
- The funding gap caused by this demographic shift begins to open in 2018 and will eventually reach approximately $11 trillion.
That gap can only be bridged by one or more of the following prescriptions, explains Tuffnell:
- Cut benefits by up to 30 percent, raise payroll taxes up to 50 percent, increase the general debt up to $11 trillion.
- Generate additional revenue using existing resources, such as allowing workers to invest a portion of their payroll-tax contributions in personal retirement accounts (an approach endorsed by President Bush).
Kerry says he will never privatize Social Security, extend the retirement age for Social Security or cut any benefits for Social Security. That means there are only two options left: increase the debt by $11 trillion or cut all other government programs by 20 percent. And since Sen. Kerry has routinely criticized President Bush for increasing the debt, one can deduce he's not about to come out in favor of increasing the debt by $11 trillion.
Source: Sean Tuffnell, "Kerry's Secret Social Security Plan -- Revealed!" National Review Online, July 29, 2004.
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