FDR’s proudest accomplishment, the national Ponzi scheme known as Social Security, is significantly closer to collapse than it was last year — and liberal groups have a lot to do with this fact, but more on that in a moment.
The old age entitlement program reported that program costs will exceed tax revenues in 2016, one year sooner than projected in last year’s report. The Old-Age and Survivors, and Disability Insurance (OASDI) Trust Funds will be exhausted in 2037, four years sooner than projected last year. “Over the 75-year period, the Trust Funds would require additional revenue equivalent to $5.3 trillion in today’s dollars to pay all scheduled benefits,” according to the program’s board of trustees.
“The worsening of the long-range outlook for the Social Security program is due primarily to the recent economic downturn and faster reductions in mortality than previously assumed,” said the trustees.
But the trustees left out an important fact: liberal activism has helped to bring Social Security to the brink.
In 2005 as the defeat of President George W. Bush’s campaign to reform Social Security, the so-called third rail of American politics, drew nearer, liberal groups savored their approaching victory. “We’re putting the power back into the third rail,” gloated Toby Chauduri, a spokesman for the Campaign for America’s Future.
Social Security has not been reformed because politicians lack the political will to take action. And why do they lack the will to act? In part because they have been urged not to take action by left-wing groups opposed to putting Social Security on a sound financial footing. These groups were effective both in keeping Democratic lawmakers in line and in scaring the bejeezus out of Republican lawmakers sympathetic to Social Security reform.
Some of the key liberal groups that have fought Social Security reform tooth and nail are the AFL-CIO, AARP (American Association of Retired Persons), American Federation of State, County, and Municipal Employees (AFSCME), Campaign for America’s Future (CAF), CAF affiliate Institute for America’s Future, International Brotherhood of Teamsters, MoveOn.org and USAction.
Remember that during the Bush era fight in Congress, the AFL-CIO, mindful that many investment firms managed labor-controlled pension fund assets, suddenly decided that protecting Social Security was Big Labor’s “fiduciary duty.”
The New York City Employees’ Retirement System wrote threatening letters to J.P. Morgan Chase, Merrill Lynch, Morgan Stanley and other firms warning that if they backed major changes to the Social Security program, labor would take their position into consideration when deciding whether the firms would continue to manage the assets of union pension funds. Translation: Support Social Security reform and lose some huge clients. Labor officials also launched a PR offensive against the firms in the media to make sure they didn’t back reform.
So, never forget how Social Security got to where it is now.