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A Social Security lesson for Abby (and other 20-somethings)

Don’t worry, Abby, you’ll be able to get Social Security.

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Don’t worry, Abby, you’ll be able to get Social Security.

Abby Huntsman is really, really upset about Social Security. We know this because the television presenter, a daughter of former Republican presidential contender Jon Huntsman, went on an extended rant about it last week on MSNBC's The Cycle. The show is aimed at a younger audience of news consumers, and Huntsman, 27, is one of the four co-hosts.

She thinks Social Security is going bankrupt, leaving her generation with nothing. "This is infuriating," she said, bouncing up and down in her chair like a petulant toddler, "because none of our elected officials seem to care enough to do anything about it."

Unfortunately, almost everything she said about Social Security in the name of making it "sustainable" for her generation was wrong. Dead wrong.

Huntsman wants to tell it like it is, but she fails because of a lack of information. A lot of her spiel resembles the rants issuing from the mouth of former Republican senator Alan Simpson, 82, a veteran font of Social Security misinformation — which shows that error and ignorance are no respecters of age. Most of it has been debunked thoroughly and repeatedly. But as a favor to Huntsman and her generation, we'll set her straight. Again.

The core of her plaint is that life expectancies have risen so sharply since 1935, when Social Security was enacted, that its current financial structure can't handle the change. Her figures are that average life expectancies for men have risen from 58 in 1935 to 76 in 2014, and for women from 62 to 80. "While we're living about two decades longer, we haven't made any real change," she said.

Huntsman makes the familiar error of confusing life expectancies from birth with the figures that actually matter to Social Security — life expectancies from age 65 when retirements typically have begun. (Under the law, the normal retirement age is rising; it will be 67 when Huntsman retires.)

Life expectancies from birth have indeed risen as she says, though the latest statistics available are from 2009, not 2014. But the difference is almost entirely a result of improvements in infant mortality since 1935.

The change in life expectancies from age 65 is much lower. In 1935, a 65-year-old man was expected to live to about 77 and a woman to about 78. In 2009, the figures were about 83 for men and 85 for women. That's an extension of six to seven years, not two decades.

And Social Security's fiscal structure accommodates that. The payroll tax has increased from 2 percent (shared between employer and employee) at its inception to 12.4 percent today.

"Here's the reality," Huntsman declares (to Social Security advocates, this is usually a sign that a real blooper is on its way, and she doesn't disappoint): "At the rate we are spending, the system will be bankrupt by the time you and I are actually eligible to get these benefits. ... Would you rather have 80 percent of what you have today, or nothing at all?"

She concludes: "We might disagree about the prescription for the ailing patient, but doing nothing about it — that will lead to none for all, rather than at least some for us."

Where Huntsman got this idea is a mystery because no one who understands the program, from supporters of Social Security to its critics, says anything like that.

The most dire projections of the program's future say that "doing nothing" — no benefit cuts, no tax increases — will leave the program still able to pay 75 percent to 80 percent of scheduled benefits. Not "nothing at all." And that 75 percent to 80 percent would still be much more a month 75 years from now than retirees get today.

Huntsman has stitched her spiel together out of scraps and tatters of misinformation, of a sort we've heard from the older generation for years. They're no more accurate coming out the mouths of a millennial. But it's tragic to see that what she's learned from her elders is how to mislead her public. — Los Angeles Times

A Social Security lesson for Abby (and other 20-somethings) 03/20/14 [Last modified: Thursday, March 20, 2014 4:02pm]
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