Observations on life

AARP is at it again . . . ignoring the rest of America

2013

In my humble opinion the AARP is a reprehensible organization. It claims to represent millions of seniors in America and then proceeds to scare the heck out of them at every chance. In the process it creates the impression it is a powerful lobby representing all of us over age 50 to influence Congress and then enters into agreements with various vendors to sell stuff to the very people it scares. Perhaps worst of all, it does a great disservice to younger Americans by pitting seniors against everyone else in their quest for everything they are “entitled to” without regard to those younger Americans who must foot the bill.

Following is a recent example. This is a flyer I received on June 22, 2013. It is misleading and outright scary. I have said this all before, but it requires repeating … a modest reduction in future increases in Social Security benefits is not a benefit cut any more than a raise 1/4% less than you expected is a cut in pay.

In the final analysis to the extent Social Security is at risk (and ultimately it is not), that risk is due more to the short-sighted, self-serving interests of organizations like the AARP than from any current proposal to make needed changes.

Of course there are alternatives to the chained CPI. If you look at the bottom of this page you will see what the Social Security Trustees (currently made up of mostly Obama appointees) have to say about improving the long-term viability of Social Security. Is it better to add more taxes on working Americans or actually cut benefits than to look for modest, gradual alternatives such a changing the COLA factor?

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Compare the above propaganda with the facts as presented by the Social Security Trustees 2013 Annual Report

For the combined OASI and DI Trust Funds to remain solvent throughout the 75-year projection period: (1) revenues would have to increase by an amount equivalent to an immediate and permanent payroll tax rate increase of 2.66 percentage points (from its current level of 12.40 percent to 15.06 percent); (2) scheduled benefits during the period would have to be reduced by an amount equivalent to an immediate and permanent reduction of 16.5 percent applied to all current and future beneficiaries, or 19.8 percent if the reductions were applied only to those who become initially eligible for benefits in 2013 or later; or (3) some combination of these approaches would have to be adopted.

The Trustees recommend that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes and give workers and beneficiaries time to adjust to them. Implementing changes soon would allow more generations to share in the needed revenue increases or reductions in scheduled benefits. Social Security will play a critical role in the lives of 58 million beneficiaries and 163 million covered workers and their families in 2013. With informed discussion, creative thinking, and timely legislative action, Social Security can continue to protect future generations.

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2 replies »

  1. I agree, AARP is harming the efforts at reform needed to make Social Security solvent.

    All who have studied Social Security agree that significant changes are required. The fear mongering by AARP only makes the situation worse.

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  2. Dick, well said. But they are worse than a simple scare. Consider AARP v Eeoc where short term thinking and litigation almost eliminated employer-sponsored Medicare-eligible retiree medical. Or where we had cooper v ibm, where they weighed in in favor of restricting an employers ability to PROSPECTIVELY change pension accruals. The choice there was not a fap or cash balance formula, but cash balance or no db plan at all.

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