Cong. Jan Schakowsky debated and discussed the issues with "Public Affairs," host Jeff Berkowitz in a show that was recorded on March 6, 2004. The show was cablecast on March 22, at 8:30 pm through-out the City of Chicago. A partial transcript of the show is included, below.
Jeff Berkowitz: Social security, it is a Ponzi scheme. Folks, if you are working today…as the money is taken out of your paycheck, presumably for social security, you may think it is going into a fund- but, no, the government is lying to you- it is not going into a fund…what you are doing is—it is going to pay somebody else who is now retiring and is going on social security, so you are giving money to somebody else who worked and paid money to give to somebody else. But, the thing is, when FDR started the thing [social security]
Cong. Jan Schakowsky: What is your point—
Berkowitz: It is a Ponzi scheme
Schakowsky: Absolutely not, as it takes the money in—
Berkowitz: As [WTTW’s] Phil Ponce made clear [at the WTTW- City Club of Chicago Republican Senate Candidate debate], it is not a Ponce scheme, it is a Ponzi scheme.
Schakowsky: And that money, that credit, that is owed to future retirees, is as good as gold. Social Security has never, never missed a payment to senior citizens.
Berkowitz: As good as gold? Well, let me challenge you on that…
When it started out, about 43 people were paying, that is 43 people were saying—here, you can take some of my income to pay one [retring] person, on average. Well now, due to a variety of demographic changes, we are heading toward a system where 2.5 people are paying for one [retiring] person [on average]. Do you see a problem there that is not Republican, not Democratic. You can’t have a system where first 43 people [per recipient], pay-- then 2.5 people [per recipient] pay and say, “not different.”
Schakowsky: If you want to sit down with the Trustees of the Social Security Trust Fund, they will explain it very clearly to you, Jeffrey.
Berkowitz: Oh?
Schakowsky: That program, with minor adjustments, is going to continue to pay retirees those benefits.
Berkowitz: What would those minor adjustments be?
Schakowsky: Well, we might want to consider lifting the income level of people who pay into social security, instead of cutting it off at $87,000.
Berkowitz: Oh, raising taxes again. So, here is the solution? [Currently], if you make up to $87,000, you continue to pay taxes [to that level]. If you make $127,000, you are not [currently] paying any additional social security taxes on that amount earned between $87,000 and $127,000 [the additional $40, 000].
Schakowsky: Republicans right now are raiding this IOU fund—
Berkowitz: So, you want to raise taxes?
Schakowsky: No-- to give it only to the wealthiest Americans. And, I have nothing against wealthy Americans—
Berkowitz: So, that is your solution [to Social Security], raising taxes. Other than that, what would we need to do?
Schakowsky: I am talking about putting money into the pockets of people who-
Berkowitz: Telling that guy or lady who is making $127,000, $120,000 or anything over $87,000 [in a year] that Jan Schakowsky is going to raise your taxes. You are. Tell them that.
Schakowsky: No.
Berkowitz: Tell them that. It is Okay to do, but I think we need to tell people what we are doing.
Schakowsky: Jeffrey, the President of the United States has made a decision to give tax breaks (looking at the whole picture) to those who earn the most money. You could put it another way. I’m going to give tax breaks-
Berkowitz: He [the President] gives them [tax breaks] to everybody. You got one. Everybody who pays [income] taxes got one.
Schakowsky: I am going to give tax cuts to people who are actually going to go out and spend the money. I am going to put money into infrastructure development. You know what, you asked me how we are going to create jobs; we are starving the states right now.
Berkowitz: …Okay, so you are going to raise [federal income] taxes to give money to the states. People are going to pay money to the federal government, who will then give it back to the states. Why don’t they just give it to the State government [directly]? It doesn’t get better as it goes through Washington, D.C.
Schakowsky: We ought not be advantaging companies who move off shore, who take jobs with them—and [we should] look at closing the tax loopholes.
Berkowitz: …If we would lower the taxes they pay, they would stay here. But, they are competing with companies in countries that pay lower taxes, so they go off shore to pay lower taxes
Schakowsky: And continue and continue a race to the bottom where everybody in the world—
Berkowitz: A Nancy Skinner line…
Jeff Berkowitz: Social security, it is a Ponzi scheme. Folks, if you are working today…as the money is taken out of your paycheck, presumably for social security, you may think it is going into a fund- but, no, the government is lying to you- it is not going into a fund…what you are doing is—it is going to pay somebody else who is now retiring and is going on social security, so you are giving money to somebody else who worked and paid money to give to somebody else. But, the thing is, when FDR started the thing [social security]
Cong. Jan Schakowsky: What is your point—
Berkowitz: It is a Ponzi scheme
Schakowsky: Absolutely not, as it takes the money in—
Berkowitz: As [WTTW’s] Phil Ponce made clear [at the WTTW- City Club of Chicago Republican Senate Candidate debate], it is not a Ponce scheme, it is a Ponzi scheme.
Schakowsky: And that money, that credit, that is owed to future retirees, is as good as gold. Social Security has never, never missed a payment to senior citizens.
Berkowitz: As good as gold? Well, let me challenge you on that…
When it started out, about 43 people were paying, that is 43 people were saying—here, you can take some of my income to pay one [retring] person, on average. Well now, due to a variety of demographic changes, we are heading toward a system where 2.5 people are paying for one [retiring] person [on average]. Do you see a problem there that is not Republican, not Democratic. You can’t have a system where first 43 people [per recipient], pay-- then 2.5 people [per recipient] pay and say, “not different.”
Schakowsky: If you want to sit down with the Trustees of the Social Security Trust Fund, they will explain it very clearly to you, Jeffrey.
Berkowitz: Oh?
Schakowsky: That program, with minor adjustments, is going to continue to pay retirees those benefits.
Berkowitz: What would those minor adjustments be?
Schakowsky: Well, we might want to consider lifting the income level of people who pay into social security, instead of cutting it off at $87,000.
Berkowitz: Oh, raising taxes again. So, here is the solution? [Currently], if you make up to $87,000, you continue to pay taxes [to that level]. If you make $127,000, you are not [currently] paying any additional social security taxes on that amount earned between $87,000 and $127,000 [the additional $40, 000].
Schakowsky: Republicans right now are raiding this IOU fund—
Berkowitz: So, you want to raise taxes?
Schakowsky: No-- to give it only to the wealthiest Americans. And, I have nothing against wealthy Americans—
Berkowitz: So, that is your solution [to Social Security], raising taxes. Other than that, what would we need to do?
Schakowsky: I am talking about putting money into the pockets of people who-
Berkowitz: Telling that guy or lady who is making $127,000, $120,000 or anything over $87,000 [in a year] that Jan Schakowsky is going to raise your taxes. You are. Tell them that.
Schakowsky: No.
Berkowitz: Tell them that. It is Okay to do, but I think we need to tell people what we are doing.
Schakowsky: Jeffrey, the President of the United States has made a decision to give tax breaks (looking at the whole picture) to those who earn the most money. You could put it another way. I’m going to give tax breaks-
Berkowitz: He [the President] gives them [tax breaks] to everybody. You got one. Everybody who pays [income] taxes got one.
Schakowsky: I am going to give tax cuts to people who are actually going to go out and spend the money. I am going to put money into infrastructure development. You know what, you asked me how we are going to create jobs; we are starving the states right now.
Berkowitz: …Okay, so you are going to raise [federal income] taxes to give money to the states. People are going to pay money to the federal government, who will then give it back to the states. Why don’t they just give it to the State government [directly]? It doesn’t get better as it goes through Washington, D.C.
Schakowsky: We ought not be advantaging companies who move off shore, who take jobs with them—and [we should] look at closing the tax loopholes.
Berkowitz: …If we would lower the taxes they pay, they would stay here. But, they are competing with companies in countries that pay lower taxes, so they go off shore to pay lower taxes
Schakowsky: And continue and continue a race to the bottom where everybody in the world—
Berkowitz: A Nancy Skinner line…
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