Continuing on with the evaluation of the Third Way document “Saving Social Security”, I’ll begin with more-accurate cost of living increases. Third Way proposes that Social Security use a chain-weighted consumer price index.
- I’m not so sure that I agree with this change because of the cumulative negative effect. In addition, if a change is overly complicated, the safest way of dealing with the issue is to reject the proposition.
- None of this would have been needed if the FICA surplus was kept as cash on the government’s books. As the FICA funds were borrowed (as represented by the nonmarketable Treasury securities in the “trust fund”, those funds were known to be obligations to be repaid. I call them a patriotic citizen’s loan. Should the political elite decide not to repay that loan, only horrible consequences will follow.