Doheny on Social Security reform

Matt Doheny, a Republican candidate for the 23rd Congressional District, was asked over eggs Saturday what he'd do to fix Social Security, which could pay out more in benefits this year than it takes in from the nation's workforce.

Mr. Doheny, Watertown, said he was looking forward to the findings of The National Commission on Fiscal Responsibility and Reform, which is in the process of drafting recommendations to balance the federal budget. One of the ideas tossed around: a reduction in Social Security benefits.

“The whole construct of Social Security needs to be rethought. So what I'm hopeful is that the commission does not just be political and say nothing.

"There's three concepts that I always remind people about Social Security.

"First, it was done in 1935. President Roosevelt - FDR - signed the act. At the time he signed it, there were 42 workers for every retiree. Today, there are less than three active workers for each retiree.

"No. 2: Life expectancy. Part of the great experiment we've had in the past 75 years is how people live a lot longer. And so as a proportion, in terms of when you actually retire vis a vis Social Security say hey, ‘Your life expectancy is on average is 65. Let's retire at 62.' So the whole idea of Social Security is to have a few years after a tough life working in the mines or the farm or the plant to go forward.

"It's totally different now. Life expectancy is near 80. And obviously the age (of retirement) has gone up a little bit, but not that much farther.

"And then the third is: We have all this technology and we have different understanding of what people can actually do. The great thing about what we have now - one of the upsides of not being such an onerous manufacturing society is that people can work longer.

"It's because of those three facts that we need to change the system and bring it up to date.

"One of the things I'll be a leader in Congress on is sunsetting laws. If we pass a law, you don't ever hear about the end for a century. Times change. People change. The whole idea of why we have certain programs is - well, you know what? Why don't we stop, check what's going on whether it's 5, 15, 20, 25 years and say you know what? What's the point of this program? Has it lived its useful life? Or has it just become one of these bureaucracies that just feeds on itself and the whole reason it exists is just to keep itself existing.

"Social Security needs to be changed — not for current beneficiaries, but for people my age and younger. You have to say, ‘OK, what really as a society do we owe people? What makes a big difference there?'

"Social Security unfortunately is probably — as somebody who knows a little bit about finances — the worst, worst, worst investment you can ever make.

The most powerful of forces, as Einstein told us, in the world is the compounding of interest. You don't get that benefit when you go ahead with Social Security. You can have a portion - again for people who are 30 or 20 or younger - that you say, ‘You know what? I get the benefit of that compounding over the course of your life.' Still only have the social safety net part where you can't do it all - only with a portion that you can put into a private account or some sort of (muffled) account and have a portion still being the same return. You can go ahead to get people with the idea that you actually get a better return, you'll have people who have longer, more useful life but also have a lot more when they finally decide to pull the plug and say, ‘You know what? We're not going to work any further.'”

UPDATE: Simon Brandler, a New York state Democratic party spokesman, issued this statement after reading my blog:

And then Team Doheny replied to the response: