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Grijalva Up to 112 Signatures on Letter Opposing Social Security Benefit Cuts

Raul Grijalva says he’s up to 112 lawmakers signing on to the vow to vote against any Cat Food Commission recommendations that cut Social Security benefits or raise the retirement age, and he expects to reach 150.

Grijalva thinks it would be a natural move for Democrats to see the program as a part of the party’s legacy and fight to protect it.

“I am hopeful we will reach the threshold where a majority of our caucus is part of” the letter, Grijalva said. “I really think instinctively it should be one of the cornerstones of the Democratic Party and politically it should be something that people reassure their constituents about their position on.” He added that “As long as it’s picking up names, we are going to continue to hold it open,” he said.

John Conyers is apparently seeking Republicans to sign on to the letter as well. At least a few GOP candidates have opposed Social Security cuts on their campaigns.

Paul van de Water of the Center for Budget and Policy Priorities has the best and simplest argument that can be used to rebut all of the nonsense floating around out there on Social Security.

Here are the facts. Social Security is a well-run, fiscally responsible program. People earn retirement, survivors, and disability benefits by making payroll tax contributions during their working years. Those taxes and other revenues are deposited in the Social Security trust funds, and all benefits and administrative expenses are paid out of the trust funds. The amount that Social Security can spend is limited by its payroll tax income plus the balance in the trust funds.

The Social Security trustees — the official body charged with evaluating the program’s long-term finances — project that Social Security can pay 100 percent of promised benefits through 2037 and about three-quarters of scheduled benefits after that, even if Congress makes no changes in the program. Relatively modest changes would put the program on a sound financial footing for 75 years and beyond […]

Investing the trust funds in Treasury securities is perfectly appropriate. The federal government borrows funds from Social Security to help finance its ongoing operations in the same way that consumers and businesses borrow money deposited in a bank to finance their spending. In neither case does this represent a “raid” on the funds. The bank depositor will get his or her money back when needed, and so will the Social Security trust funds.

As far back as 1938, independent advisors to Social Security firmly endorsed the investment of Social Security surpluses in Treasury securities, saying that it does “not involve any misuse of these moneys or endanger the safety of these funds.”

Moreover, Social Security is the “polar opposite of a Ponzi scheme,” says the man who quite literally wrote the book about Ponzi’s famous scam, Boston University professor Mitchell Zuckoff. The Social Security Administration’s historian has a piece on this topic as well.

Unlike the frauds of Ponzi — and, more recently, Bernard Madoff — Social Security does not promise unrealistically large financial returns and does not require unsustainable increases in the number of participants to remain solvent. Instead, for the past 75 years it has provided a foundation that workers can build on for retirement as well as social insurance protection to families whose breadwinner dies and workers who become disabled.

These are the intellectual underpinnings for an argument that Democrats – who hold in their hands the future of the program – must hear in the next couple months.

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David Dayen

David Dayen