Thursday, December 13, 2012

Let's Play With Some Numbers, Social Security Edition

Boy howdy, but did I make a mistake this morning. I made the mistake of allowing myself to become distracted while I was "multi-tasking" and surfing the cable channels at the same time I was checking my emails AND getting a phone call. All of a sudden, I realized I was on MSNBC and listening to Moanin' Joe where the topic of the day appeared to be whining about how those dastardly libruls just wouldn't get with the program and worship at the altar of Pete Peterson (as Joe declared he does.)

Then I saw someone by the name of Rick Stengel talking about how "entitlements" needed to be cut in order for everyone to show how "serious" they are with the "fiscal cliff."

Of course, everyone that was on that show this morning (it included Harold Ford, Steven Rattner, Michael Steele, Disco Dave, Tweety, and Chuck Todd) as well as everyone on all the various talking head shows watched by the Beltway Village Idiots Courtiers are people who will never have to worry about living on Social Security as the only thing keeping them from poverty and homelessness, so they are all fine with most any and all changes being discussed. After all, they are all Very Serious People, often wrong but never in doubt. Why, we could almost call them all "economists" they are wrong so often.

A couple of years ago, I wrote this post, "Let's Play With Some Numbers" as a "what-if" about the mythical person working the mythical full time, minimum wage job and what that person might be able to afford as far as a place to live, and associated costs.

Why is this pertinent?

Well, the current average monthly Social Security payment (for October 2012) is $1,237 per month which works out to be $14,844 per year. This will go up to $1,261 in 2013. Where I had my mythical full time minimum wage earner paying FICA/Medicare taxes, other taxes (and some healthcare costs) and missing work on the "Big 6" holidays (New Years Day, Memorial Day, July 4, Labor Day, Thanksgiving, and Christmas) before getting into the actual available funds to pay bills (lowering the income from $15,080 by $2,570 to $12,510), the mythical average Social Security recipient pays $99.90 per month for Medicare Part B starting at age 65, going up to $104.90 for 2013.

The point of all this is that a mythical person collecting average Social Security benefits is in roughly the same position financially as the mythical person who works a mythical full time minimum wage job. My WAG is that for every person who is collecting Social Security and also has the benefits of a defined pension, 401K, or robust savings, there is another person who is relying solely and completely on Social Security and Medicare to stay alive. With the Great Recession having taken its toll these past few years, I imagine there are many people just trying to hold on until they reach age 62 and can start collecting something. I imagine there are many more, like myself, who have had to cash in their 401k/IRAs early just to try to stay alive for these past few years.

So let's remind the Beltway Village Idiots Politicians, Pundits, and Courtiers that there are real world consequences when they so blithely toss around "cut entitlement spending" as a "solution to the deficit." As Mr Pierce puts it so eloquently, "Fck the deficit. People got no jobs. People got no money."

And because I can:


  1. The assumption that makes a mere idiot into an autocrat is that most of us will happily toss the less fortunate overboard, i.e., cut entitlements, if we are secure. The theme thrown out over and over in this campaign is that only those younger workers will have to face this, us old coots who were so smart we are already on social security are okay. Notice the losing party still hasn't figured out, we're not like them.

    1. Of course, even when they claim that only young workers will face this, they are lying.

      But while I am single with no children, I have no desire to see my younger cousins screwed over.

      It is mostly only within the Beltway universe that "I've got mine, feck you" is the operative way of life.

  2. Thank you for the post and for saying what I have been shouting to the TV / Radio / Media talking heads. It is chilling to see these experts and elected officials "bargaining" with the lives of millions of Americans. They try to drive opinion to their views, and hope to influence the decision makers on the final legislation. All in direct harm of real people, not statistics. These experts are paid by the people who will gain from destroying the lives of citizens, people they do not know and will never meet.

    Thank you again for this post.

    1. Yeah, and of course, the folks doing the bargaining have no clue whatsoever about life out here in the real world. They are in the world where $100K salary is "struggling middle-class" (in St Ronnie's days) and that has become Willard's $250K is middle-class. NO idea at all about the millions getting by on a fraction of that.

  3. I live on Social Security and I live in poverty. Not all of the time but the danger is constantly there. If we don't make extra we don't have enough. If Social Security is keeping people out of poverty, then they are hovering just above it. And the rules about the limit of earned income restrict "job creation". (That last sentence was /s)You can make all the passive income you want but your ass will get taxed twice if you make over $14,000 a year if you are between 62 and 65. And you are allowed $38,000 if you are 65 and up. Not that I know anyone doing that.

  4. Thank you Mary. You just made my point with a lot fewer words. Based on my minimum wage "Let's Play..." post, anyone at this level of income is living pretty much hand-to-mouth and doG forbid they actually incur some type of abnormal expense of any sort.