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Means testing at various thresholds, Chained CPI, handful of Cap increases. In this figure a score of 0.6 means entirely backfilling the 75 year actuarial gap. (For those who care that is percentage of GDP). Note that if you set means testing levels at 'rich' levels you don't really get much bang and same for donut hole proposal for cap increases (e.g. the Obama-Biden 2008 proposal to partially lift the cap only for $250k+ folk).
Over to you all, I just like starting from real data points.

Source: CBO 2010 'Social Security Policy Options'

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Comment Preferences

  •  Tip Jar (7+ / 0-)

    socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

    by Bruce Webb on Tue Jan 29, 2013 at 05:47:07 AM PST

  •  Link to the report (3+ / 0-)
    Recommended by:
    tardis10, Bruce Webb, musiccitymollie

    Democratic Leaders must be very clear they stand with the working class of our country. Democrats must hold the line in demanding that deficit reduction is done fairly -- not on the backs of the elderly, the sick, children and the poor.

    by Betty Pinson on Tue Jan 29, 2013 at 07:13:04 AM PST

    •  A complementary but more thorough source (1+ / 0-)
      Recommended by:
      musiccitymollie

      The Social Security actuaries (OACT) maintain a much more extensive list of what they call solvency "provisions." It is less handy to read than the CBO report, but again has considerably more detail.

      It also has the advantage that the provisions are taken from actual proposals, so if you have read about it in the news (e.g. Simpson-Bowles) they have. Also they update a least every couple of years (the current version uses 2011 Trustees assumptions. Don;t look for CBO to update too soon. The OACT list scores as a percentage of taxable payroll rather than as a percentage of GDP. Substantively this is just a matter of units, but taxable payroll makes it easy to convert into the equivalent tax rate hike (the 75-year deficit of 2.7% of payroll is roughly equivalent to the revenue raised from increasing the  payroll taxes by 2.7% today--from 12.4 to 15.1)). Last, OACT are the official scorekeepers of SS reform legislation. All that said, CBO also do a great job.

      Here is a table from OACT summarizing the options:
      http://www.ssa.gov/...

      For a provision by provision look:
      http://www.ssa.gov/...

      •  Thanks, Economides. N/T (0+ / 0-)

        Mollie

        “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

        by musiccitymollie on Tue Jan 29, 2013 at 09:50:29 AM PST

        [ Parent ]

      •  CBO official scorekeepers for legislation (0+ / 0-)

        and have historically been slightly more optimistic than OACT. for example under 2010 OACT numbers the gap would be 0.7 rather than 0.6. meaning that actual legislative proposals based on various plans scored for solvency by SSA OACT might look a little more robust once socred by CBO and their partners in crime JCT. Part of what makes tracking all thos so challenging. For example my online mentor Dean Baker almost always uses CBO numbers while my fellow authors of the NW Plan use OACT. Mostly because they are more pessimistic than CBO making our fix more likely to score on the upside.

        But on the whole CBO and OACT track, in large part because CBO explicitly adopts OACT demographic numbers even as they substitute their own macroeconomic assumptions, which in turn are not dramatically different. but enough to shift dates and numbers by significant amounts.

        socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

        by Bruce Webb on Tue Jan 29, 2013 at 03:26:31 PM PST

        [ Parent ]

        •  Officially, OACT scores all SS legislation (1+ / 0-)
          Recommended by:
          HeyMikey

          Not that it means much. (it's not like there are specific budget rules for SS that makes CBO's/JCT's ruling so important). Both projection are done by smart dedicated professionals and they are both as helpful as any long-range projections can be.

          I would caution people against choosing one set of projections versus another based on the central projection being more or less pessimistic/optimistic. There is enough uncertainty over the medium and long-term such that the the two projections are essentially the same. (Very technical note: use CBO's alternative fiscal scenario to compare to OACT's projection--reason has to do with projection of future taxation of benefits).

          CBO's projection model is far more useful for understanding the distributional consequences of legislation which i think is often as important as the net financial impact. CBO does a much better job of graphical presentation of results, and of presenting the uncertainty of projections. CBO have been slowly building in more of their own assumption including for immigration and disability. (CBO are slightly more pessimistic than OACT on disability)

          OACT has a far more extensive list that is primarily drawn from actual legislative proposals. OACT updates their results to updated Trustees assumptions (they follow about a year behind or so).OACT has nifty graphs showing the impact of each proposal on cost and income rates, as well as the Trust Fund ratio. OACT result are in terms of taxable payroll which i think is more intuitive way to think  about the costs of reform.

          Most of that is more detail than most anyone needs (except for the people who i actually have to make decisions).

          •  You're right, no big deal (1+ / 0-)
            Recommended by:
            HeyMikey

            My point is that the overall scoring for any omnibus or grand bargain bill that includes Social Security as a component will be scored for conformance with Congressional budget rules by CBO/JCT and will to that degree be more binding on the parties than any side scoring done and released by OACT.

            That is their is 'scoring' and 'congressional budget scoring' and quite naturally Congress pays more heed to their own (Joint Committee on Taxation and Congressional Budget Office) than they officially to to an agency at least nominally under the Executive.

            And while the OACT is staffed by career people and is ostensibly not partisan the same is not true for the upper levels of management at SSA (Commissioner, Principal Deputy, and the various regular Deputy Commissioners) who are all political appointees, As are the Trustees. And while the OACT might resist any pressure exerted from above they can't avoid it entirely.

            As an example economist Andrew Biggs, currently at AEI, and formerly the Deputy Director of Cato's Project for Social Security Privatization (since renamed Project for Social Security CHOICE) spent the time between those two gigs as a political appointee at Social Security, including a stint as Principal Deputy Commissioner, i.e. the no 2 guy and a signatory of the annual Report (ex officio as Secretary to the Trustees).

            It is as certain as anything that Andrew didn't suddenly forget his entire career of pushing for privatization.

            Which isn't to say that either CBO or OACT are NECESSARILY leaning in a partisan way, just that the Speaker and the President have different reasons for relying on one against the other. At the end of the day they can demand resignations from the shops they control.

            socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

            by Bruce Webb on Wed Jan 30, 2013 at 01:02:23 PM PST

            [ Parent ]

            •  I don't buy the political pressure insinuation (0+ / 0-)

              I totally reject the notion that the Trustees projections are vulnerable to political motivation. I don't know anyone involved in the process who would suggest otherwise. (there's a very recent op-ed by Alicia Munnell, former Asst Treas Sec under Clinton making many of the same points). This is not the same as saying the writing of the report is not subject to influence, but that is different from the assumptions and projections.

              Neither the President, nor the Commissioner can demand the resignation of the Chief Actuary. They can only be removed for cause.

              The Public Trustees have to agree to any changes and there is one from each party. So there is always one person from the opposite party who can veto any politically motivated decision (there are no majority votes, the only act by unanimity).

              Every 4 years there is a technical panel of independent experts who review the projections. None have ever suggested there was a whiff of funny business. None would tolerate it. They have plenty of disagreements with the actuaries and Trustees, but to sugget they are politically motivated is simply misguided. If anything there is an acute realization that the process is governed by careerist technicians in the actuaries office ( and to a much  lesser extent Treasury Dept.) and not by the Trustees themselves.

              For the last 5 or 6 years the projections are subject to a full scope audit by the Inspector general (who contracts it out to the various majort audit firms).

              Andrew Biggs was never a trustee. He was secretary to the Trustees, but in effect He was one of several dozen staff at the assistant secretary level and below who help the trustees address their duties. To suggest that he had a major substantive influence on the projections process is again a misunderstanding of his role and the process itself. I happen to know Andrew and also happen to know that his own opinion about the Trustees projections are not all in the direction that would make the projections worse. The same could be said for people of many various political persuasions. Lots of people make technical arguments for or against various changes. Some of the strongest arguments for changes that make the system look more expensive have been from liberals. Again the extent to which the process is dominated by career technocrats needs to be better appreciated.

              If you are interested who really influences the substantive choices of the Trustees it pretty much begins and ends with the public trustees and the Actuaries.  Every now and again Treasury makes a strong stand for something.

              In addition you should compare the Administration's budget assumptions that are explicitly political with the Trustees' projections. They are different, because one process is political and the other is not.

              As for CBO, it is not governed by the Speaker of the House, although either House as a whole may remove the director. The folks who run the long-term modeling unit are pretty well insulated. I can't think of anyone who works there who would not resign right away if they were ordered, based on politics to change their models. Just doesn't happen that way.

              Also, Social Security is off budget. So I don't see why Social Security changes would fall under budget rules--Unless they including tapping general revenue sources, i guess.  There is no requirement that reform proposals hit any particular score.

              Both OACT and CBO get involved in designing legislative proposals. OACT has a very deep and long-standing relationship with the Congressional Committees of jurisdiction to the point that they can be understood to work fro the legislative branch almost as much as they work for the Executive.

  •  Thanks for the chart, Bruce. I'm going to dig out (2+ / 0-)
    Recommended by:
    tardis10, denise b

    a video or two of the President of the NASI (National Academy of Social Insurance) making a couple of points about Social Security Reform.

    What I do understand is that we cannot go with the policy option to reduce PIA Factors to Index Initial Benefits to Prices Rather Than Earnings.  Something very similar to this was done in Britain under Thatcher, and they had to institute a special old age "welfare program" due to the dire straits that it left many seniors in.

    I've read that by year 2100 or thereabouts (with price instead of wage indexing) it would practically "flatline" the benefit, and in time, the "Buffet's of the World" would be receiving close to the same small monthly stipend that their secretaries receive.  Price indexing completely disassociates one's wages from one's benefits.  

    So IMO, that's out, period.  Which brings us back to "lifting the cap on taxable wages, and not increasing benefits."  Or a modification of that policy.

    Gregory (NASI) and her warned that we haven't even "felt" the entire effects of the Greenspan Commission, and that the 'replacement value' of Social Security will be dropping to about 27% or so when all of the Greenspan cuts are implemented (this was in 2010 that she said this).  I haven't viewed this video in a while, but I believe that she's referring to cuts above and beyond the raising of the FRA to age 67.  But I'll need to go back and review it.

    Gregory was a major player in the Greenspan Commission, as a staffer for and representative of the Dem Senator from Florida, Claude Pepper, who proposed raising the FRA to age 67.

    In one video, Gregory explains their (the Greenspan Commission) thinking, which has been vastly off-base due to skyrocketing health care costs, the collapse of defined benefit retirement plans, energy costs, etc.

    And, of course, this January 1st many very harsh and punitive cuts to low-income programs have gone into effect as part of the 1.5-1.7 Trillion Dollar package of cuts to Discretionary Spending.  [Such as to LIHEAP, etc.]  

    The recent Farm Bill, according to Dem Senator Debbie Stabenow on Newsmakers, C-Span, is cutting the Food Stamp program by 4 Billion Dollars over 10 years.  

    And Bloomberg Businessweek reports that according to Senator Stabenow, "cuts to the food stamp program beyond the $4 billion over 10 years included in a Senate-passed farm bill "are something I am willing to talk about."  Here's the link.

    So, it would seem that if we must make cuts (and I'm not personally convinced that there need be much cutting), they will have to come from affluent beneficiaries, but not restricted to only 'the Warren Buffets.'  

    The Bowles-Simpson proposal would slash benefits for working class folks, so their proposal is not one that is worth the paper it is written on, IMO.  That policy would clearly put tens of millions of seniors in poverty, so I disregard their recommendations entirely.
    Even Rep Jan Schakowsky agrees with this assessment.  Here's an excerpt and a link to her Reuters piece entitled "The Sham of Simpson-Bowles."
    Under Simpson-Bowles, long-term solvency for Social Security is achieved mostly by cutting benefits. Seventy-five years out, the ratio of spending cuts to revenue increases is 4 to 1.

    They propose raising the age of full Social Security benefits to 69 – claiming that everyone is living longer. But a sizable percentage of Americans, mostly lower-income workers, especially women, are actually living shorter lives, and a large chunk of other Americans just can’t work that long – even if they can find a job. Their plan cuts benefits for current and future retirees by reducing the cost-of-living adjustment.

    For future retirees, all these changes taken together would reduce the average annual benefit for middle-income workers – those with annual earnings of $43,000 to $69,000 – by up to 35 percent.

    I wish that the PtB would put a payroll tax increase (dedicated, of course) on the table, much like they considered in the 1990's.  I wonder, is it libertarian ideology that keeps this from being considered?  [I don't have a clue, myself, but one has to wonder.]

    Thanks for posting the table again.  Have trouble reading it, so I printed it out.  Makes a lot of difference, LOL.

    Rather pushed for time, so hope this isn't riddled with typos.  :-)

    Mollie

    “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

    by musiccitymollie on Tue Jan 29, 2013 at 08:25:58 AM PST

    •  Betty's link leads to lots more analysis (2+ / 0-)
      Recommended by:
      musiccitymollie, denise b

      On all 30 options, I was just too lazy to track it down.

      So thanks to  her.

      And for all the rest of you. IF you can. GO READ. If not pay close attention to how much of the gap actually gets backfilled by which  option. There is a certain amount of Golden Bullet coated with Magical Fairy Dust talk out there. Particularly in ways to sweeten benefits at the lower end.

      Me I still like Option 2+. 100% of scheduled benefit for everyone at a price of only 7% of the projected increase in REAL (i.e. not nominal) WAGE. Sometimes people bend themselves into pretzels trying to propose 'progressive' solutions to Social Security that undermine its status as a worker funded insurance plan for workers.

      As presently constructed Social Security draws nothing from capital and so owes nothing to capital. Indeed capital owes a big share of the $2.6 trillion in accumulated assets back to SS. Raising the cap and/or extending it to unearned income (i.e capital gains and dividends) may boost the revenue stream but at the expense of giving political leverage to capital.

      Remember "He who Pays the Piper, Calls the Tune". Which is exactly why FDR and his Brain Trust set up Title 2 SS (what we know as Social Security today) on a strictly worker funded model. I mean it is not like he was opposed to progressive taxation in general, by the time he was done top rates were at 94%. With not a penny going from income tax to Social Security. Before asking for any such transfer people need to think about why the program was set up in the way it was and ask themselves why they think they are smarter than FDR and Frances Perkins.

      socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

      by Bruce Webb on Tue Jan 29, 2013 at 08:45:35 AM PST

      [ Parent ]

      •  But there is no reason to reduce the wage base (1+ / 0-)
        Recommended by:
        musiccitymollie

        Over the last 30 years , because of disproportionate wage growth above the tax cap, the share of the economy's wages subject to the Social Security payroll tax have fallen from about 90 to somewhere between 85% and 82%.

        That accounts for a decent chunk of the financing shortfall.

        We indexed benefits to reflect average wage growth, why not index benefits to a stable share of the wage pool. A lot of people talk about setting the tax max threshold to cover 90% of earnings. Any number is basically arbitrary, but I can't think of any justification, not by Frances Perkins or by Roosevelt why the share should erode over time.

        It's interesting to note that Medicare is funded by the entire wage base (their is no cap) and this year there is a surcharge on unearned income fro person's above a certain  (relatively high) income threshold. Medicare is beholden to capital, I guess.

        •  thats Option 5 (0+ / 0-)

          and I am for it. it backfills 0.2% of the 0.6% which remainder could be met by an extended version of option 3.

          but this post wasn't about my policy preferences but instead to launch exactly this kind of discussion

          and there are very good reasons why health care and retirement should have different financing mechanisms and different calls on capital vs labor. but I guess snark is easier, hence your last clause

          which is actually quite standard for your past responses to me. oddly we both seem to have egos. In the blogosphere. whocouldanode?

          socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

          by Bruce Webb on Tue Jan 29, 2013 at 02:56:24 PM PST

          [ Parent ]

          •  Yeah. (1+ / 0-)
            Recommended by:
            HeyMikey

            This sure sounds like an argument about policy preferences:

            Sometimes people bend themselves into pretzels trying to propose 'progressive' solutions to Social Security that undermine its status as a worker funded insurance plan for workers....Raising the cap and/or extending it to unearned income (i.e capital gains and dividends) may boost the revenue stream but at the expense of giving political leverage to capital.
            Remember "He who Pays the Piper, Calls the Tune". Which is exactly why FDR and his Brain Trust set up Title 2 SS (what we know as Social Security today) on a strictly worker funded model.
            I mostly agree with that except to say that some increase in the cap should be made purely to reverse the erosion of the wage base to what Congress thought reasonable the last time they made significant reform--roughly 90%. Not accounting for the impact of inequality will make any plan premised on just raising rates less effective, unless you think wages above the cap will stop growing faster than wages below the cap. I certainly agree that we should not be taxing unearned income to fund OASDI.

            The contrast between Medicare and Social Security funding is just the--a comparison. not everyone follows this stuff so closely, and clearly social insurance legislation is not all made in the graven image of Frances Rooselvelt

            •  Principles not limited to Social Security. (1+ / 0-)
              Recommended by:
              musiccitymollie
              Not accounting for the impact of inequality will make any plan premised on just raising rates less effective, unless you think wages above the cap will stop growing faster than wages below the cap.
              Generally GDP (last quarter excepted) and productivity continue to grow, but disposable income for most people remains flat or drops. That's a good argument for generally a more aggressive social safety net funded by more aggressively progressive taxation.

              "The true strength of our nation comes not from the might of our arms or the scale of our wealth, but from the enduring power of our ideals." - Barack Obama

              by HeyMikey on Wed Jan 30, 2013 at 07:01:41 PM PST

              [ Parent ]

              •  Yes, but (0+ / 0-)

                The average wage which indexes social Security benefits tends to increase even when most wages are flat, because wages at the very top have in fact been growing.

                As I stated, one effect of the design of Social Security benefits is that even if wages for most stagnate, benefit levels (and thus the strength of the safety net) may still go up because the very top incomes grow so much.

                That not an argument in favor of inequality--Worker would be much better off if their own wages grew. It's just an observation of a lesser known fact.

      •  Like Option #2 also. N/T (0+ / 0-)

        Mollie

        “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

        by musiccitymollie on Tue Jan 29, 2013 at 02:52:55 PM PST

        [ Parent ]

    •  Clarification about price indexing (1+ / 0-)
      Recommended by:
      musiccitymollie
      Price indexing completely disassociates one's wages from one's benefits.  
      I don't think that is really true. In fact, it associates benefits with a person's own real wages.

      A little appreciated aspect of the current benefit formula is that your benefit is associated not only with your own wages, but with growth in the economy wide average wage level over time. That is above and beyond adjusting for changes in the price level, your past benefits are scaled up by the average increase in standards of living (even if your own wages were stagnant).

      Wage inequality has little to recommend itself, (and I am no fan of so called progressive price indexing) but at least the rapid increase in wage levels above the tax cap, helps grow everyone's benefit faster than if they were based merely on the growth of wages below the cap.

      •  Actually, I do understand that (1+ / 0-)
        Recommended by:
        denise b

        "the current benefit formula is that your benefit is associated not only with your own wages, but with growth in the economy wide average wage level over time," and I want it to stay that way, LOL!

        Surely you don't believe that an average annual Social Security benefit of $13,000-$14,000 is too generous?

        I'll try to round up a White Paper that outlines in some detail how Britain went to "Price Indexing," and what havoc that wrought.  And they had much better retirement plans through their employers, than we have.

        Look forward to reading the material you've provided.  Thanks.

        Mollie

        “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

        by musiccitymollie on Tue Jan 29, 2013 at 10:01:43 AM PST

        [ Parent ]

      •  This is what I was "trying to say" . . . (0+ / 0-)

        From the Urban Institute:

        The current benefit formula is that your benefit is associated not only with your own wages, but with growth in the economy wide average wage level over time.

        How Would Price Indexing Work?

        Price indexing would hold the purchasing power of initial retirement benefits constant over time, instead of adjusting benefits to wage growth, as under the current system. . . .

        Benefits would fall further behind currently scheduled payments each year, to the extent that wage growth exceeds price growth over time.

        That was what I was trying to express.  And I did blow it.  :-)

        Mollie

        “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

        by musiccitymollie on Tue Jan 29, 2013 at 10:21:17 AM PST

        [ Parent ]

        •  This is correct (1+ / 0-)
          Recommended by:
          Bruce Webb

          Pure price indexing basically says that future benefits will reflects today's standard of living. Our current system allows future retirees to benefit from gains in the standard of living. Most people if they understood this would never go for pure price indexing.

          Most proposals to change the indexing in the benefit formula now focus on gradually shifting to price indexing only for some portion of the income distribution. Look at the description of so-called "progressive price-indexing". To make a dent in the financial shortfall you have to dig pretty  deep down into middle incomes. You cannot save money by limiting the benefits of only the top 1 or 2 percent. there simply are not enough of them.

          •  Don't go along with the suggested formula for (0+ / 0-)

            "progressive price indexing," either.

            Here's the proposed new formula in The Moment of Truth:

            In order to control costs, the Commission proposes gradually moving to a more progressive benefit formula that slows future benefit growth, particularly for 'higher earners'.  [My single quotation marks.]  

            Currently, initial benefits are calculated using a progressive three-bracket formula that offers individuals 90 percent of their first $9,000 of (wage-indexed) average lifetime income, 32 percent of their next $55,000, and 15 percent of their remaining income, up to the taxable maximum.

            The Commission recommends gradually transitioning to a four-bracket formula by breaking the middle bracket in two at the median income level ($38,000 in 2010, $63,000 in 2050), and then gradually changing the replacement rates from 90 percent, 32 percent, and 15 percent to 90 percent, 30 percent, 10 percent, and 5 percent.


            So now, the definition of "high earners" isn't One Quarter Of A Million Dollars to One Million Dollars--it's a whopping $38,000 annual income!

            [Guess we'll have to "agree to disagree."]

            And, all I can about the Bowles-Simpson proposal is:   they've got to be kidding.  ROTFL!

            Mollie

            “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

            by musiccitymollie on Tue Jan 29, 2013 at 12:42:03 PM PST

            [ Parent ]

  •  I thank Betty, too, for the report. Hope to read (0+ / 0-)

    it this week.  Honestly, though, from all that I read, today the only options that are being seriously considered are what Bowles-Simpson, Gang of Six, Eight, Ten?, and Dominici-Rivlin (and the like) have put forward.  So, many of the options listed on your chart, etc., may be preferable, but I truly don't think that they're on the table.

    BTW, didn't see that you replied to my comment to Roger, in another diary.  So the comment above hopefully suffices as my reply.

    Me I still like Option 2+. 100% of scheduled benefit for everyone at a price of only 7% of the projected increase in REAL (i.e. not nominal) WAGE.

    I'm not sure what you're saying here.  Is Option 2+ the second line of the chart that you've posted?  Your reference to "real" versus "nominal."  

    I'm in favor of an increase in the payroll tax.  Just not the two most regressive cuts that the Fiscal Commission recommends.

    I'll try to post a couple of the minute long clips from the Greenspan Commission forum.

    They emphasize that the lowest four quintiles depend "heavily" upon their monthly Social Security benefit checks.  IOW, they are either the "primary" source of income, or the "only" source of income for 80% of the population.

    That being the case [not to beat a dead horse], I can't imagine "lowering" benefits.  If anything, they need to be raised for this same cohort, due to what I anticipate as a great deal more costs shifting of medical expenses to seniors (through Medicare reform).

    And certainly, not slashed, as Schakowsky puts it.

    Mollie

    “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

    by musiccitymollie on Tue Jan 29, 2013 at 09:11:23 AM PST

    •  The options are in order from 1-30 (1+ / 0-)
      Recommended by:
      musiccitymollie

      on the graphic and in the Report.

      The 7% number is Dean Baker's  and is the result of not truncating increases after 20 years (Opt 2) or 60 years (Opt 3)  but instead taking a steady state of increase over 75 years. But it is all about phasing in the same actuarial payroll gap. As implicitly noted you could mitigate that somewhat by adjusting the cap to 90% (where it historically was) or by adopting one or another of theother cap increase proposals. but the big point is that cuts to scheduled benefits are not inevitable, there is a whole buffet of mix and match options to maintain that schedule.

      socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

      by Bruce Webb on Tue Jan 29, 2013 at 03:07:56 PM PST

      [ Parent ]

      •  Gotcha. I've read this report, some time ago. (0+ / 0-)

        But glad to bookmark it (and review it) again, since it would take me forever to find the original, because I don't save them to folders anymore.

        Thanks.

        Mollie

        “If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

        by musiccitymollie on Tue Jan 29, 2013 at 03:52:41 PM PST

        [ Parent ]

  •  Sorry I missed the discussion (0+ / 0-)

    I found this 2 days too late.

    FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

    by Roger Fox on Thu Jan 31, 2013 at 01:26:02 PM PST

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