2012 Democratic Presidential Candidates on Social Security

Depending on who you listen to, our Social Security system, long held to be the third rail of American politics and one of the few unqualified success stories of the Federal government, is either

In its most financially sound state ever

Unsustainable in the long run

Approaching a period of turmoil and heading for bankruptcy

A brainchild of the late German Chancellor, Otto von Bismark in the late 19th century, calls to privatize Social Security have been gaining strength in recent years, mainly by conservatives and Republicans, painting a picture of the lack of sustainability of the program without continuous tax increase and benefits reduction, owing to the declining birth rates of the country, which is crucial in the pay-as-you-go model of the program.

This is countered by the liberals and democrats, citing Paul Krugman, our economic Nobel Laureate, who maintains that an additional revenue injection of 0.54% of the national GDP, which is less than 3% of our annual Federal spending, is sufficient to cope with any potential systemic decline in the number of contributors and maintain a healthy long term status of the program that is currently aiding over 53 million Americans every month.

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Comment on Social Security

Declared 2012 Democratic Presidential Candidate
Current President of the United States

Barack Obama

Obama Position on Social Security

• Unlike his predecessor and some of his major opponents, Barack Obama has declared his firm
opposition to the idea of privatization of the social security structure saying that it would create
more losers with no assets to rely on during retirement.

 

• In his opinion, the best method of fixing social security and other entitlement programs is to
reverse the policies which have 'ruled the roost' under the Bush administration. In this way, not
only would the social security be stable and solvent for most of the American citizens but would
also result in tax policies which are favorable for many of the middle-income groups in the
country.

 

• Barack Obama also rules out the stock market option for social security saying that to encourage
individuals to pursue a high-risk and high-investment strategy would be an inadvisable course of
action. Instead, individuals should invest only those savings in the stock market which are not a
part of the social security.

 

• According to Obama, there is nothing wrong with the fundamental model of social security but
there is a long-term problem of the number of retirees exceeding the number of current workers. This
can be rectified by raising the limit of payroll tax for wealthy individuals and exempting the
middle class to the extent possible.

 

• To save the social security from becoming bankrupt, Obama feels that one option of preserving
social security is to opt for a bipartisan solution which would not only enable the social security
fund to remain solvent for the next many years to come but would also prevent its privatization.