[PAA-Discuss] Rick Perry Proposes Letting States Opt Out of Social Security

[Ron and Kris Graham]

Rick Perry Proposes Letting States Opt Out of Social Security 


Saturday 06 November 2010

by: Ian Millhiser
<http://thinkprogress.org/2010/11/06/perry-channels-miller/>   |
ThinkProgress | Report


Appearing on CNN's Parker/Spitzer this past week, occasionally secessionist
<http://thinkprogress.org/2009/04/15/perry-texas-secession/>  Texas Gov.
Rick Perry (R) proposed allowing states to opt-out of Social Security:
<http://www.rawstory.com/rs/2010/11/texas-gov-states-opt-social-security/> 

"Here's what I think would be a very wise thing," he began. "In 1981,
Matagorda, Brazoria, and Galveston Counties all opted out of the Social
Security program for their employees. Today, their program is very, very
well-funded and there is no question about whether it's going to be funded
in the out years. It's there. That's an option out there."

"So, you want to let people opt out?" responded Spitzer.

"I think, let the states decide if that's what's best for their cities,"
Perry replied.

"So the states will let people opt out of Social Security?" Spitzer asked

"They should," the recently reelected Texas governor said.

Perry should learn a little history before he raises up the 1981 experiment
as a model for Social Security reform. In that experiment, three Texas
counties "decided to opt out of Social Security and instead to provide their
public employees with a system of privatized accounts." But this system left
participants worse off <http://thinkprogress.org/index.php?p=728>  than they
would have been under Social Security.

Moreover, Perry's proposal closely resembles Alaska GOP Senate candidate Joe
<http://thinkprogress.org/2010/10/04/miller-minimum-wage/> "A Noun, a Verb
and Unconstitutional" Miller's economically impossible
<http://wonkroom.thinkprogress.org/2010/08/31/miller-tenther/>  plan for a
state takeover of Social Security and Medicare. A workable plan to allow
states to opt out of Social Security would require draconian provisions,
such as a mandate that everyone must retire in the same state that they
worked and paid taxes in. Otherwise, workers who are too young to receive
Social Security benefits would move to an opt-out state to avoid paying
Social Security taxes - and then promptly move to a state with Social
Security benefits the moment they became eligible. Eventually, the entire
system would collapse under the weight of too many Social Security
beneficiaries who had not paid into the system.

And this isn't even the first time this week that Perry released a
completely unworkable idea whose only virtue is that it will poll well with
the Tea Party. Earlier this week, Perry released excerpts from his
forthcoming book that attack the Constitution
<http://thinkprogress.org/2010/11/02/perry-sixteenther/> for allowing a
national income tax and for requiring senators to be chosen through a
radical process known as an "election." 

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