For the last several years it has been forecast that Social Security will take in less money than they will pay out in 2015. Now it is being forecast Social Security will start paying more out that they receive in 2010.

This should not surprise anyone who has been paying attention to the economy for the last year.

Social Security has been financing the government for over 20 years. They are holding trillions in government bonds that are supposedly redeemable upon demand. We have been paying into Social Security every time we receive a paycheck with the promise that we will receive our benefits when we qualify, whether it is retirement, disability, or survivor benefits.

I just read Allan Sloan’s article in Fortune discussing the problems that the Social Security Administration is facing. The title of the article is “The Next Great Bailout,” referring to Social Security. This title is not only erroneous but insulting to the millions of people who have been paying Social Security taxes year after year. Social Security does not need a bailout! Redemption of the trillions of dollars of government bonds they are holding is not a bail out. It is money that is owed to Social Security by the Federal government who has for years confiscated, although legally, the billions of extra Social Security taxes paid and used to make the federal deficit look smaller than it truly was. Now the Feds have to step up to the plate and pay off their debt, probably by borrowing from another source.

Allan Sloan compares the previous bailouts of “incompetent banks, faddish mortgage borrowers, General Motors, AIG, GMAC, and Wall Street” as “pigs feeding at Uncle Sam’s trough. To say the least, I loved the comparison, particularly with the almost daily news that we here about how these pigs are using the bail out money.

There is no question that Social Security needs fixing. It cannot continue paying the benefits they are currently paying and hope to continue to be solvent, especially with the onslaught of the baby boomers. Change is needed. But let’s call it what it is.

Social Security mailed 3900 stimulus checks of $250 to prisoners. Unfortunately, 2200 got entitled to them because of the way the law was written. They were eligible for the checks because they were not in jail during the three months prior to the enactment of the stimulus package. Social Security correctly sent the prisoners $250.

The media does not seem to be in the least concerned that 2200 prisoners legally received the stimulus checks because the law was poorly written.

Why didn’t Congress exclude them from receiving the checks if they were in jail at the time the checks were mailed?

All the attention has been focused on the 1700 prisoners that received the checks that were not eligible to them. They received the checks because Social Security was not aware they were prisoners. Most of the checks were returned by the prison facilities upon receipt.

The government did not lose $425,000 as the media has suggested.

Social Security will take aggressive action to get ALL the money back that was erroneously mailed and not returned. I would bet at the time I am writing this that there are less than 500 outstanding payments.

I think that Social Security did an awesome job minimizing the error rate in this area. Incidentally, the error rate involving prisoners to the entire group was .003%.

It was recently reported that three Regional Commissioners for the Social Security Administration received cash awards averaging $54,000 each.

Am I the only one who thinks this isn’t right?

Consider this – The dedicated employees on the field offices awards averaged less than $1,000. And, only the top 20% of employees received an award!

I was in management and had input or made the final decision on who received an award in my office.

When I am talking about awards given in the field offices where the claims are taken and processed, where there are constant demands to do more with less and almost all contact with the public occurred, the awards ranged from about $200-$900.

That was also about the same amount management in the offices received.

The higher up in the bureaucracy that you go, the higher the awards. There is little consideration given to how the individual contributed to the overall success of the agency.

Social Security field offices are understaffed.

It has been Congressional policy for at least the last 20 years to reduce the number of SSA employees every year. Now it is practically impossible to accomplish all the work that is expected of them and do it with any degree of quality.

Yet Congress continues to whittle away at the staffing while wringing their hands and declaring that more work has to be done faster.

But yet, somehow, while decreasing staffing, the funds can be found for $54,000 awards for those at the top.

Thoughts?

The Social Security Administration began issuing debit cards last year to those who did not have direct deposit and wanted an easier way to receive their monthly benefits other than by check. SSA has always had problems with checks being lost, stolen or delayed in the mail. With the advent of direct deposit, much of this problem was resolved. But there were many who did not have bank accounts.

And paying benefits digitally rather than by paper is a big savings to SSA. It cost about $1.00 to mail a paper check and only 10 to 12 cents to do it by automated transfer. With the 500,000 people already signed up for the debit card, it is saving the SSA about $440,000 each month. And SSA needs every one of those dollars!

Along came the debit cards. Each month, the amount of the Social Security benefit is added to the card. There are no fees for signing up and you can get one free replacement card each year if you should lose the card.

Sounds like a safe and easy way to receive your money. It is if you use it carefully and know about additional fees that can be charged if you are not careful. Some of those fees include a $4.00 charge for a second replacement card in a year, $.75 for a monthly statement by mail, $.90 for each ATM withdrawal after the first one, plus additional fees if you use an out-of-network ATM machine, which seem to be difficult to find. If you need cash, your best bet is to get cash back when you purchase something.

This is a very positive step by SSA in resolving many of the problems revolving around lost, stolen, or delayed checks. Kudos for SSA!

It’s rumored that there will be no cost of living adjustment (COLA) for 2010. And the Congressional Budget Office (CBO) is saying that there might not be another COLA until 2013.

But Medicare Part B (doctor’s insurance) premiums will continue to increase. There is no slowdown in health care costs. Most current Social Security recipients are protected from having their benefits reduced due to Part B premium increases under a “hold harmless” provision in the law.

Medicare Part B premiums are set up to cover about 25% of the cost of Part B insurance. The premium increases with COLA’s for 2010 to 2012 were projected to be $103 going up to $109.
Because 75% of those currently on Medicare won’t have their premiums increased, the FEDS have come up with a really equitable(?) way to make up for the loss.

All newly entitled Medicare beneficiaries will carry the brunt of the load. Their Medicare premiums in 2010 is projected to be $119, for 2011 $123, and for 2012 it is projected to be $128.

By 2012, a newly entitled Medicare recipient will be paying $259.20 more for Part B insurance than someone that is currently entitled to Medicare!

Just because of their date of birth or date of entitlement to disability.

For the same coverage!

Unfortunately, this is typical of our government. Chose a small group, with little or no voice and stick it to them.