Hunting for an agenda, Bush has Social Security in his sights

[Yo_Mama_Been_Loggin]

Bush figures he hasn't screwed this country over enough.

By MARIANNE MEANS
SYNDICATED COLUMNIST

WASHINGTON -- In urgent need of some fresh ideas for a second term to present at the Republican Convention, President Bush is framing an economic message called "the ownership society."

That sounds swell. Who doesn't want to own the personally important things that make life comfortable?

But what exactly does the slogan mean? How do we get to this ideal society? The major policy incentives that advisers are saying the president should tout aren't really new. Unless some secret surprise is pending, it's old wine in a new bottle.

Despite a shaky economy and towering federal deficits, Bush hasn't yet had his fill of tax cuts to drain the federal treasury. Nor has he abandoned his theme of shrinking the size of federal government programs and services, even though such spending has vastly escalated during his watch.

A proposal to overhaul the tax code to achieve lower rates is also reportedly in the works. The shadow of Steve Forbes and his demand to kill the Internal Revenue Service still hovers. Bush isn't yet finished pandering to the rich.

http://seattlepi.nwsource.com/opinion/187542_means24.html

[ayeshahaqqiqa]

1. I worry if Bush says he's going to help SS

look out. He'll gut it and give all the money to his rich buddies.

[Yo_Mama_Been_Loggin]

2. The well to do already come out ahead per Social Security.

Remember deductions are made only on the first $70,000 (approximate number) one earns.

[DemOperative]

3. You can count on it

They've been polling like mad in theflyover states to find the correct wording for this. Basically, the Stock Market has exhausted all other options. To Create new huge cash inflows, the plan is "privatizing" Social Security. The fee schedule I've seen proposed is obscene and promises to add billions to the coffers of the investment banks, at the cost to those who can of course least afford it.

Just as an FYI guess who is a major partner or shadow owner in the proposed list of "fiduciaries" for holding this cash?

Well, the initials of the Country are S.A. and there aren't any Latins involved. Rhymes with Moravia.

[Yo_Mama_Been_Loggin]

4. Problem of it is.

The Stock Market's been in the toilet under Chimpy's watch. I've been investing since the Reagan years and overall my assets always appreciated. Not so under the dim son.

[Martin Eden]

5. Paul Krugman: 2-1=4

Krugman wrote this column in reponse Bush's original proposal for SS "personal accounts," and it is every bit as relevant now as it was then. If you haven't read Krugman's book The Great Unraveling, I highly recommend you do.

---snip---
Social Security as we know it is a system in which each generation's payroll taxes are mainly used to support the previous generation's retirement. If contributions from younger workers go into personal accounts instead, the problem should be obvious: who will pay benefits to today's retirees and older workers? It's just arithmetic: 2-1=1. So privatization creates a financial hole that must be filled by slashing benefits, providing large financial transfers from the rest of the government or both.

During the 2000 election campaign, George W. Bush was able to get away with the nonsensical claim that private accounts would not only yield high, low-risk returns, but save Social Security at the same time. For whatever reason, few reporters pointed out that he was claiming that 2-1=4. But when it came time to produce concrete plans, the arithmetic could no longer be avoided.

Sure enough, the plans laid out by Mr. Bush's Commission to Strengthen Social Security, though presented as confusingly as possible, involve both severe benefit cuts and huge "magic asterisks," infusions of trillions of dollars from an undisclosed location. The extent of the damage is documented in a new Center on Budget and Policy Priorities report by Peter Diamond of the Massachusetts Institute of Technology and Peter Orszag of the Brookings Institution. (Mr. Diamond, who is one of the world's most eminent economists, and is arguably the world's leading expert on retirement systems, was my colleague when I taught at M.I.T.)

---snip---
As the facts about Social Security privatization gradually emerge, the general strategy of the privatizers seems to be to keep the public confused as long as possible. Indeed, Republicans are now being told to deny that personal accounts — which expose their owners to all the risks of any private investment — constitute "privatization." "Do not be complicit in Democratic demagoguery," urges one party memo. So it looks like a duck and walks like a duck, but it isn't a duck — not until after the next election.

---snip---
Read more:
http://www.ourfuture.org/issues_and_campaigns/socialsecurity/resources/op_eds/readarticle235.cfm

[TahitiNut]

6. Can every American be part of the "ownership class"??

If so, who'll do the work?

The "ownership class" lives in the Great House and drinks mint juleps. The "working class" lives in the barn and labors in the cotton fields.

There's not a penny of wealth ever created without a penny's worth of labor. Just how much of that penny does the owner of the field get?

[Name removed]

9. Deleted message

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[TahitiNut]

11. No, not at all. The "ownership class" are those whose primary income ...

... is derived from the labor or others. That doesn't include insurance proceeds! Social Security (OASDI) is "death insurance."

You say ...

Ownership refers to actually owning an account in your own name. The working class is presently chipping in around 14% of their pay for SS. I would much rather have an account that 14% goes into than a govt. IOU. Open your eyes.

Respectfully,
CK

"Open your eyes"???

Well, in a similarly "respectful" tone, wipe the GOP elephant shit out of your own.

Try going to your insurance company and telling them you want a separate "account" for your premiums and that you want it kept for you and not given to anyone else for their losses. After they get done laughing, they'll try to sell you an annuity. Buy the annuity and your wish will come true .. or at least as true as delusions get. :eyes:

[yellowcanine]

7. Earth to Shrub - To own things you have to be able to buy them. That

takes income. That takes jobs. That pay well. We lost jobs under your leadership. You are making it more difficult for some workers to collect overtime pay - which they need to become "owners". What gives, shrubmeister?

[Name removed]

8. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Martin Eden]

10. Why personal accounts aren't feasible

SS is an inter-generaltional system. SS taxes deducted from the paychecks of current workers are used to pay the benefits of current retirees (whose SS taxes paid benefits for the generation that came before them).

If taxes from current workers are diverted to private accounts, where will the money for current retirees come from? You'd either have to cut SS benefits to current retirees (a political non-starter) or take the money from general revenues.

During the transition period while retirees without SS personal accounts are still being paid full benefits, the federal government would need to run large budget surpluses to finance the transition. The current record deficits make such a plan completely unaffordable.

Actually, SS is fairly solvent if you keep separate books on SS taxes collected and benefits paid. Most of the Clinton budget surplus was actually the accumulation of SS taxes. In 1983 when the future retirement of the baby boom generation loomed as a threat to SS solvency, SS taxes were raised by 2%. This increase (SS is called a regressive tax because it takes a relatively bigger chunk from the paychecks of the lower and middle classes) was a prudent measure targeted for a future need. Al Gore was ridiculed for the "lock box" he advocated for this surplus; it's too bad he didn't do a better job of explaining why it was necessary.

The Bush administration has raided the SS fund and distributed it to the wealthiest Americans in the form of tax cuts -- at a time in our history when the gap between the rich and the rest of us is the biggest since before the Great Depression. Proposals to divert SS taxes into personal accounts will make it even more difficult to pay benefits to retirees who had been paying extra taxes for the last two decades -- taxes that were increased specifically to fund their retirement.

The SS system is broken only to the extent that its funds have been diverted for other purposes. It's a loan the Bush administration apparently has no intention of paying back, and they are in fact confusing the issue by acting as if the SS system itself is at fault here.

It fits in well with the right wing agenda of shrinking the government by "starving the beast" -- while their wealthy constituents grow fat on the spolis.

We are witnessing a huge transfer of wealth from working Americans to the coffers of the corporate elite who also profit from moving our jobs overseas.

We need reform in this country all right, but SS personal accounts ain't it.

[TahitiNut]

12. Here's a graph that shows Federal Budget Surpluses and Deficits ...

... broken out by 'On-Budget' (like the military) and 'Off-Budget" (almost all of which is Social Security). Social Security Trust Fund surpluses, shown by the 'Off-Budget' line have been used by GOP demagogues to understate how the worsening Federal Debt is guaranteed to cause significant federal tax increases of all kinds when ...
(1) they can't borrow from the trust fund (as it's used as intended and depleted to help pay boomer benefits until the 2040's),
(2) existing federal debt held in the trust fund must be paid off,
(3) the accumulated federal debt exceeds an entire year's GDP - the total productive efforts of the entire nation.





This makes it pretty clear how the accumulated Federal Debt, which we were gaining some control over until the Reagan/Bush years, is now soaring to all-time highs vis-a-vis the GDP (the most reasonable basis for comparison).