ROMNEY, PERRY and SOCIAL SECURITY

The last debate and , probably the next debate, will feature a continuing dialog between Mitt Romney and Rick Perry on Social Security, framed upon statements they both have made in published books and recent comments. It is instructive to look at these published comments and compare them, before the " spinmeister's " begin excising clips from the two candidate's published comments , to seek advantage. Therefore, I will attempt to focus on this issue using only actual published comments from both no older than 12 months.

Rick Perry wrote a book that was published last November ( 2010 ) entitled
" Fed Up ! Our Fight to Save America from Washington". Here are Perry's published comments about Social Security:
** " Social Security is something we have been forced to accept for more than 70 years now."
** Social Security is a " crumbling monument to the failure of the new deal."
** Social Security is a ".. monstrous lie."
** Social Security is " ..a Ponzi scheme " and " Ponzi schemes, like the one that sent Bernie
Madoff to prison, are illegal in this country for a reason. They are fraudulent systems
designed to take a lot of money at the front end and pay out none at the end. This
unsustainable insanity is the true legacy of Social Security and the New Deal. Deceptive
accounting has hoodwinked the American public into thinking that Social Security is a
retirement system and financially sound, when clearly it is not."

These are Perry's words verbatim. Readers should note that the implication is that Social Security is a CRIME of INTENT. A Ponzi scheme is ILLEGAL. "Hoodwinked" implies an intent to defraud. Who exactly is doing this and exactly who should go to jail is something Governor Perry needs to be specific on.

In contrast, Governor Romney wrote a book which was published this past spring, entitled
"No Apology, the Case for American Greatness". In that book , Romney had several specific comments on Social Security. More importantly, Romney also suggested several ways to begin fixing a program that many senior Americans rely on. Let's see what he said:

** pp 46......" In one of our Republican primary debates, for example, we were asked
" Specifically, what would you do to fix Social Security ?" Most responded by restating
the problem that Social Security is bankrupt rather than by addressing a solution;
politicians have learned from experience that it is unwise to " touch the third rail of
American politics." But, why is that ? Why is it that the media don't hold accountable those
who duck this critical issue? Why isn't it instead that FAILURE to address entitlement and
Social Security REFORM ids the third rail?"

** pp 157-158....To put it in a nutshell, the American people have been effectively defrauded
out of their Social Security. In 1982, the government raised Social Security taxes with the
intention of creating a surplus that could be set aside in some fashion for the baby
boomers..."
" But for the last thirty years, the surplus has been spent, not on retirement security, but
on regular items."

** " It is important to conduct the entitlement discussion without scaring our senior citizens,
which is why the reforms that are necessary must be made concurrent with guarantees to
our elderly that their benefits will not be slashed and the promises they relied upon will
not be broken..." , that "........solutions will not be crafted with them ( seniors ) as targets."

Then Romney begins to address specific solutions for fixing Social Security:

** pp 158-159 : " From a mathematical perspective , there are at least four ways one could
repair Social Security. "

1. " Congress and the president could raise the Social Security tax rate or apply it to a
greater share of an individual's earnings, or some combination of both" ......" but, we
would saddle the next generation with the very tax burden we are seeking to avoid."

2. " We could gradually increase the retirement age "

3. " We could change the way high income individual's initial Social Security benefits are
calculated. At present, the initial benefit for all recipients is keyed to the total amount of
their lifetime employment income and the Social Security taxes paid on it, adjusted for
inflation before retirement. But the inflator that is used in the calculation isn't the
consumer price index ( CPI ), as you might suspect, but rather the wage index.Because
wages have gone up a good deal faster than consumer prices, the wage index raises the
starting point for S.S. benefits faster than if the CPI had been used." An alternative
would be to "......use the wage index as the inflator for low and middle-income citizens"
who rely on Social Security, but " apply the CPI index to compute the initial benefits for
higher income individuals who are not living predominantly on Social Security benefits."

4. " Individual retirement accounts offer a fourth option, one that would allow today's
wage earners to direct a portion of their Social Security tax to a private account rather
than go entirely to pay the benefits of current retirees."
" also like the fact that the individual retirement accounts would encourage more
Americans to invest in the private sector that powers our economy."
" But given the volatility of investment values...I would prefer that individual accounts
were added to Social Security, not diverted from it, and that they were voluntary."

So, here we have the controversy in " a nutshell." Perry says Social Security is an illegal scheme foisted upon the American public. He says nothing about fixing the problem, nothing about sustainability. The implication is that someone is benefiting from the " scheme" and should be punished , but says nothing about how seniors can be protected, as the guilty are hauled away and the " monstrous lie " is , presumably terminated and replaced with.....what ?

Romney says the program must be fixed so we can sustain the pledge we made to seniors, in good faith, 70 years ago. He offers specific, well crafted ideas to help redress the problems with the Social Security system and provide confidence to the seniors of today and tomorrow that their retirement program is solvent and ready for them at retirement.

You decide. Who has the rational approach to the problem? All we know is what we read.

CraigS

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