Bob Brigham on last nights Bush Social Security speech
Bob Brigham of
"There is no crisis" has the following to say about Bush's speech last night:
Bush Plan (before press conference)
Benefit Cuts
Debt
Privatization (phase-out)
Bush Plan (from press conference)
Benefit Cuts
Debt
Privatization (phase-out)
Sound timeless? It is, Bush has been pushing a "fake crisis" as an excuse to gut Social Security since 1978.
But some things do change: the more the people hear of Bush trying to defraud them of their Social Security benefits, the more they hate Bush.I agree with Bob. But that doesn't mean the Republicans and Bush won't pass some plan to gut the Social Security system subtly over the long term - like the Posner plan Bush announced last night that converts Social Security from a retirement system to a system of welfare for the aged.
WaPo and Josh Marshall on Bush's Social Security ideas
Here is what
Josh Marshall said about the Social Security ideas Bush threw out last night:
"Interesting. The Post
pretty much nails the new Bush plan on the front page of tomorrow's paper: cut pretty much everyone's benefits a lot. The sweetener? Poor people's benefits won't be cut as much!"
-- Josh Marshall I agree.
I just have to say it.
OK. So if we don't do anything, the current Social Security system will run out of money in 2041 and only be able to pay (worst case scenario) 70% of the promised benefits. Bush calls that "
Bankrupt."*
His solution? Cut the benefits before 2041 by about 40% by holding benefits to current levels rather than letting them increase with increased wages - Oh, and cut even more by "means-testing" the benefits for the middle class and higher so that they get even less.
Mind you, in 2041 the projections indicate that the 70% of promised benefits is more than if we do as he stated and pay "as much as beneficiaries are getting today."
And that saves the system from becoming "Bankrupt?"
More likely it means the trust fund never has to be paid back the money that has been borrowed to cover his tax cuts for the wealthy.
[* I don't think he has a clue what it means to be Bankrupt. It is a buzz word, or even a scare word that he is using to rush his audience into a self-defeating set of decisions.]
Josh Marshall review the Press Conference
Josh Marshall in
Talking Points Memo describes his view of what Bush said about Social Security this evening. It's worth reading, but my favorite line is
"Basically, from this president, it's phase-out today, phase-out tomorrow, phase-out forever" which sums it up very nicely.
Bush plans Private accounts, lower benefits for Social Security
Bush promises to keep pushing his reform of Social Security. I guess he was answering the unstated question of whether his poor poll results resulting from his 60-Days, 60-Stops Banboozlepalooza will make him quit or back off.
An important statement he made tonight is that people in the future will get at least as much as current beneificiaries.
That means a benefit cut for future beneficiaries, since the benefits will begin replacing less and less of earnings lost because of retirement. That is to say, wages will increase but the benefits will remain at the level of today. Right now most retirees get about 40% of the wages they paid taxes on and the benefits rise as a result of increased wages. Then after retirement the wages are increased based on the Consumer Price Index (CPI) rather than the increase in wages. The average wage increase over time has historically been about twice the rate of the increase in the CPI.
He would also give lower benefits to higher income workers. That is, it would be "means-based." These two items would more than eliminate any projected deficit.
Of course, he still demands that private accounts be included, so that there is some actual ownership involved. What he doesn't say here is that this can only be done by borrowing more to pay benefits to make up for the amounts diverted to the private accounts. That means that his private accounts will add to the federal deficit that he and the Congress have already let get totally out of control.
The economic effects of that additional borrowing is very likely to slow our economy, either through higher interest rates or increased inflation - or both.
Means-testing Social Security will turn Social Security into a pure welfare program. That will guarantee political problems for maintaining benefit levels for beneficiaries in the future, as the original planners setting up Social Security recognized. When the only issue is keeping retirees out of poverty, it becomes easier to lower the measure of poverty than to increase the level of payments. The Texas Legislature proved that two years ago when it cut thousands of poor people and children off Medicaid just to save money and not raise taxes.
Bush offered nothing new, but he threw out the statement "We [the Republicans] are the party of ideas. Where are the Democratic Party ideas?" ABC TV reported that some Democratic person had already stated that private accounts were off the table. Period.
When he was asked if a plan was presented that guaranteed solvency of Social Security
but did not include private accounts, would he accept that?
Bush answered no. He wants private accounts
even though they do nothing to improve the program! Then he promised people who would go for private accounts would do better than under the current system. Of course, he offered no guarantee of that, and the history in the United Kingdom and Chile has been that this simply hasn't happened for large numbers of people. The private accounts are pure unreasoned ideology on Bush's part no matter who gets hurt.
The Associated Press has a news report on the Press Conference already.
MSNBC also has their report.
A failed plan has no owner
The Republicans are beginning to point fingers at each other about who is to blame for the failure of Bush's Social Security phased out program. Bob Cusak at
The Hill has the story.
Rally to support Social Security
The
Americans United to Support Social Security is holding a rally in Washington D.C. from 1:00 PM to 3:15 PM.
================
More politics. The real issues have been long exposed, and the low polls for the Bush White House are a result of the popular decision that he is wrong. These efforts against his program are going to need to be continued, though, because Bush has a tactic of continuing to push long after good sense would indicate that he should quit. This has occasionally resulted in his opposition weakening and giving at least some of what he wants.
Remember also that the Bush White House is all political operation and little or no policy operation. A policy to them is the basis for the real action, a political campaign. That is why Bush has refused to present a plan on Social Security, and has told the Congress to come up with one.
Mere policy-making is below the Bush people. We can all see how well that worked for Jerry Bremer with the CPI he ran in Iraq. They set all the conditions for the insurgency to get big and never saw it coming.
Why should they? Their politics is about getting everyone to do things their way, not figuring out why there is opposition. That would require understanding their opponents, who are by definition wrong. Why learn the wrong things from your opponents?
My bet is that Bush will still be pushing for Social Security phase-out until he leaves office. Also, like his father, he will continue to ignore real problems we all face if we are not in the Bush family.
Bush responds to failure of 60 day Social Security tour
Bush has almost reached the end of his 60-day and 60-stop tour to sell his Social Security ideas. No plan yet, just some ideas. The result so far is (from
Bloomberg):
"An ABC News-Washington Post poll released yesterday [April 25] showed that 64 percent of Americans now disapprove of his handling of Social Security, up from 56 percent in March."So Bush is going to do what any CEO would do after spending massive amounts of time and money to get the result of declining sales of his product. He is going to extend the tour after May 1st.
More from
Bloomberg:
"``The president is going to continue to travel across the country,'' McClellan said April 18. Bush has declined to offer a detailed plan beyond the private accounts, saying it's up to Congress to offer proposals. Democrats are refusing to come to the table without specifics from the administration.
The decision to continue campaign-style trips underscores the dilemma Bush faces. It will be almost impossible to recruit congressional backing until the president wins more public support. As of now, leaders of both parties say there is little prospect for any bi-partisan accord, which is essential to enactment of any major Social Security legislation.
``Social Security reform is stuck in the mud on Capitol Hill,'' said Stu Rothenberg, editor of the nonpartisan Rothenberg Political Report, a Washington-based newsletter reporting on electoral politics. ``The only way to move this issue forward is to create a groundswell at the grassroots.''
So far, the groundswell for Bush's plan has failed to materialize, judging by polls and comments from lawmakers.
``It doesn't look good,'' said Karlyn Bowman, a public opinion analyst at the American Enterprise Institute, a policy research organization in Washington. No recent poll shows Bush with an approval rating higher than 35 percent on Social Security, she said. ``The issue is fading,'' she said. Voters ``seem a little bored with it.'' [...]
Opponents say the president is being forced to prolong his bid for public approval because opposition to private accounts proved stronger than the president's advisers anticipated.
``The administration is still trying to sell the same old idea, just in different ways, and the public is still not buying,'' said David Certner, director of federal affairs for the AARP, the nation's biggest seniors group and an opponent of Bush's proposal. ``Unless the administration decides to go in a different direction, we're going to have a continued stalemate.'' Private accounts right now are a non-starter. A solution for the problem that may or may not occur in 2041, 2042 or 2052 (depending on which projection you read) is something that can be thought about, and probably should not be wrapped up in a program established by the very people (the Republican Party) who have wanted to destroy Social Security since it was first created.
Besides, Iraq, the federal deficit, the trade deficit, the falling dollar, lack of employment, healthcare (with the Medicare drug plan as more problem than solution), potential inflation and increasing interest rates are all problems that are a lot more immediate and need to be dealt with now.
So why is Bush futzing around with Social Security Reform when is clearly isn't going to fly anyway? Is he trying to hide from the real problems he doesn't want to deal with?
Social Security News from WaPo
The
Washington Post (WaPo) has a computer search for its recent Social Security articles at the link above.
Particularly interesting is
this article which essentially says that the Republicans have given up trying to get bipartisan cover for their effort to phase out the Social Security program. Whether they can succeed in writing a bill that the Republicans themselves will vote for is the next question.
Bush may still be talking "Social Security reform" but these guys have to run for reelection, some in November 2006. They still have to listen to their constituents.
Democracy Corps declares Bush SS initiative dead
This is good news on the Social Security Front. This report of poll results is from the
Democracy Corps (requires free Adobe reader - forward to page 7 of document):
Priorities and the Collapse of Social Security
"And by the way, support for the president's Social Security initiative has collapsed. The more voters hear during the president's 60-day campaign to educate the country, the less they like it. Today, just 34 percent support the idea of Bush's Social Security reform - down to its lowest point. Opposition is up 8 points in a month, now at 58 percent. But after a brief period of assessing the private account, the country is determined to put a knife in this idea. In the last
month, opposition has jumped to 60 percent, up 9 points, and half the country is strongly opposed. This idea is as dead with the public as anything the administration has offered."Based on this report of a series of polls, it appears that the American public recognizes that Bush's efforts to "revamp" Social Security into private accounts are really an effort to destroy an important, effective and working program for ideological reasons and replace it with an extremely expensive fig leaf that has little likelihood of performing as he suggests it might. Since the money to pay for this ideologically-inspired monstrosity would be borrowed on top of the already excessive federal deficit, it is getting the reception it deserves.
That is a testament to the good sense of the American public.
Snow - SS cuts needed to reduce deficit
Josh Marshall of TPM points out that Secretary of the Treasury Snow’s remarks to the Bond Traders makes explicit that the reason for Social Security benefit cuts is to clean up the fiscal mess they have made by the severe tax cuts for the wealthy.
Greenspan says link Social Security to Longevity
Reuters reports that Alan Greenspan tells Senate that Social Security benefits should be linked to increases in how long people are expected to live.
Uncle Alan is not an actuary. Let's keep that in mind. He
is, however, a Libertarian. Keep in mind that the entire move to eliminate Social Security and replace it with 401(k) type accounts came out of the CATO institute, the Libertarian think tank
Down Market casts pall on Bush's phase out plans
The
New York Times reports that the recent decline of the stock market is particularly poorly timed for the Bush effort to change Social Security to private accounts. It is also making Republican politicians to ask why a President who doesn't have to run for reelection is asking them to place their offices on the line for this effort.
A graphic on world experience with Social Security
The
Washington Post has published a good graphic on a number of social security programs around the world. Go look.
Great Britain - How is privatization doing?
The
Washington Post also looked at how privatization has worked in Great Britain.
”What President Bush is proposing for the United States closely echoes the privatization plan that then-prime minister Margaret Thatcher -- an apostle of rolling back the modern welfare state -- implemented in Britain in the late 1980s. Millions of Britons flocked to Thatcher's plan, egged on by government subsidies, by hard-selling private investment funds and by state-sponsored advertisements showing a pair of hands breaking free from the chains of government regulation.
“But for many investors Thatcher's plan has fallen flat. Many investment funds charged huge commissions and fees, leaving contributors worse off than they would have been in the state system. The stock market collapse four years ago compounded their losses. Meanwhile, many private pension plans have gone bust, after companies drained those plans to pay off rising debts.
“These days many of the same insurance companies and banks that heavily sold their funds are sending out letters suggesting that customers rejoin the state system. Since November alone, an estimated 90,000 clients have followed that advice.”Essentially, the article points out that the private accounts were oversold. Very few of the people covered under them were expected by actuaries to get more from private accounts than from the previous government system. Then, the funds placed in private accounts were frequently siphoned off by the managers, who then reneged on the benefit promised. In short, private accounts have been most unsatisfactory in Great Britain.
Not a very promising comparison for Bush’s suggestions.
Chile - How is Privatization doing?
The
Washington Post offered a description of the privatized system adopted by Chile under Pinochet.
The article is reasonably descriptive, but suffers from a typical journalistic attempt at "even-handedness." They offer a description of part of the system, a problem of that part, and then offer a positive aspect, then Continue to the next part of the system and follow the same pattern.
They draw no real conclusions and do not give enough total information for the reader to draw many conclusions, but I'll give it a shot.
The most significant conclusion I could draw was that few of the original projections about what was expected to happen worked out as expected. Especially, benefits are lower than expected, costs to the government are higher than expected, and not as many people are covered as were expected.
We really need to know more and have some experts interpret the results and offer comparisons to the US.
Bush discusses Social Security - again & again
From the
New York Times Apr 18 (last night):
COLUMBIA, S.C. (Reuters) - President Bush said on Monday proposals to raise the retirement age for Social Security benefits and restructuring those benefits to be more generous to low-income workers are among possibilities for overhauling the country's largest entitlement program.Today the
New York Times Apr 19th provides another report.
COLUMBIA, S.C., April 18 - President Bush took his campaign to overhaul Social Security to the friendly territory of South Carolina on Monday, telling a joint session of the Legislature that he was open to a variety of ideas to fix the retirement program's long-term solvency problems.
Those ideas included, Mr. Bush said, raising the retirement age and progressive indexation, in which the pain of benefit cuts would fall more on people with higher incomes.
In addition, he said he appreciated an idea from an independent-minded Republican, Senator Lindsey Graham of South Carolina, who has proposed raising the cap on the income subject to Social Security taxes.
The president was also complimentary about a proposal on the opposite end of the financial spectrum advanced by South Carolina's other Republican senator, Jim DeMint, who has insisted that Social Security's solvency problems could be solved by market forces if workers were allowed to invest a large part of their Social Security payroll taxes in their own investment accounts. Previously, Mr. Bush has said just the opposite, that investment accounts would not fix Social Security's solvency problems.[Note that Bush is now contradicting himself.]
But Mr. Bush's embrace of the cacophony of ideas is part of a White House strategy to pivot from promoting a sense of crisis about Social Security, as Mr. Bush has sought to do in travels around the country over the past six weeks, to offering solutions.
"All these ideas are on the table, but they have one thing in common: they all require us to act now," Mr. Bush said in the 19th-century State House.[Underlining is mine – RB]
He still doesn’t present a plan, he still uses “scare” language to try to stampede people into acting “Right Now!” like a door-to-door salesman, the article does not mention private accounts, and he still is less trustworthy than a door-to-door aluminum siding salesman.
Bush's entire period in the White House has been a set of efforts to get his way by misleading the American public. In the Social Security phase out discussion his continued use of inaccurate scare language, his demand that a decision be made "Right Now!", his history of gut-level unthinking opposition to Social Security and his unwillingness to present a plan of his own or consider a tax increase all demonstrate strong reasons to
not act at this time.
He is like the used car salesman who tells you that the current deal is only available ritht now. That tells you he is running a scam, and the solution is to walk away and ignore him.
Never take a deal that is offered "right-now-only" because you are being scammed.This is still a political operation to phase out Social Security and is not a serious effort to deal with potential problems in the system. Go look at my previous
blog for the source of the current effort by the conservatives to phase out the plan they have hated since it was inaugurated in 1935.
In short, nothing new. The political effort to phase out the Social Security System is still in the pure politics period.
Why NOT private accounts?
So the President wants everyone to have the opportunity to invest their own retirement funds. Personal choice is good, right?
Yeah? And do you depend on your own mechanical abilities to keep your car running so that it is available to get you to work? I don't. I don't have the tools, the experience or the time to do my own mechanic work. Investing requires education, experience, time and tools also. I have the education, but mostly I lack the time.
So why not just let the government invest in the stock market for us, and we all take the results from the Social Security trust fund? Dick Cheney has said that the business community does NOT want the government investing in the market. [Of course - those government investors would be experts and would be in a position to demand information from managers that the rest of us can never get. Enron and Worldcom could never have happened.]
But Cheney does have a point. Do we really want to have the federal government sitting on a huge supply of investible funds that it controls and then use those funds to decide which companies receive money and which companies don't? The risk of
political manipulation of the stock and bond markets would be extremely high.
It already happens with private investors, of course, but this would take the practice to new levels because of the very size of the supply of funds. This is the most important reason why the current investment of the trust funds in government bonds is the best possible use of those funds.
So they propose private accounts and will offer a set of outsourced mutual funds with private managers contracting to manage them. The best that arrangement could provide is average investment results, and that is not likely.
Those are some of my objections. The
Washington Post offers its' view of the situation.
Bush to hand off Social Security to Senate
Bush won't present plan for Social Security. This from the
Washington Post:
Bush is confident that he has convinced Americans that Social Security faces long-term fiscal problems, even if they remain skeptical of his plan for personal investment accounts. Now, aides say, he wants the Finance Committee, which has jurisdiction over the issue, to take the lead role in crafting a new Social Security program.Frankly, I can't decide if Bush has simply given up the revamp effort he started, or if he is just looking for someone else to take the blame for the mess that has been created. It does seem quite irresponsible to me.
What about the children?
Daniel Shorr
writes in the Christian Science Monitor about a completely overlooked part of the Social Security debate currently going on.
In the current great debate about Social Security, you hear a lot about retirees and soon-to-retire baby boomers, not much about the 1 in 3 beneficiaries who receive support from other components of the program.
About 3.1 million children under 18 receive benefits because a parent has died or become disabled. Another 2.2 million children live in households where at least one adult receives Social Security benefits. For many families, Social Security is the primary, if not the only source of support, preventing many low-income families from falling into poverty. […]
The debate loses sight of the fact that Social Security was designed as a family insurance program. […]
When the Bush administration talks of introducing private investment accounts, it doesn't say how this would affect disabled younger workers who can't accumulate enough assets to start such an account.It is very unlikely that someone who dies or becomes disabled will be able to provide for his children and spouse through savings. These are people who will have to be covered by the government in some way. Right now, they are covered through the Social Security System.
Where did the idea of phasing out Social Security come from?
From
The Despoiling of America this is what
Pat Robertson stated on August 14, 1985 about phasing out Social Security:
1. "We should say to all the elderly, "You're going to be taken care of. The governments going to pay you. Dont worry about it. [You'll] get your Social Security like youre expecting, 'cause you're counting on it."
2. "There should be a gradual moving [up] of [the retirement] age to reflect the fact that we're healthier and we live longer and people should have dignity and be allowed to work a little bit longer."
3. "The last thing we should do is to begin to let the younger workers slowly but surely go into private programs where the money is tax sheltered and over the years build up their own money and that would in turn, through the intermediary organizations, banks, insurance companies, would invest in American industry. They would buy plants and equipment, put people to work and it would help a tremendous boom. Imagine - $100 billion dollars a year flowing into American industry. It would be marvelous."Funny thing about this. It is
the plan G. W. Bush has been pushing since the beginning of 2005. Don't forget, Bush himself has admitted that private accounts do not solve the problem he claims Social Security has. This is payoff to the Social Conservatives who think they elected him.
No new news on Social Security per Bloomberg
Bloomberg has a rather noncommittal story on Bush’s plans for Social Security.
”April 14 (Bloomberg) -- President George W. Bush said overhauling Social Security will ``take a while'' because any proposal will be politically controversial and he is still working to convince the public about the extent of the problem. “Bush is crossing the country trying to convince voters that Social Security is in immediate crisis and must be revised “Right Now!” But he still hasn’t offered any specifics beyond private accounts, which he has specifically stated do not solve the problem he is trying to convince everyone exists.
In short, no news. Bush still doesn’t know what to do with Social Security. Which is good news for Social Security.
Frankly, I don't think the Republicans
can do anything about Social Security. It is going to require a Democratic administration to deal with it.
House Republican leaders need to look up "hubris"
Ralph Z. Hallow of
The Washington Times (Apr 14, 2005) reports the new thinking of the House Republican Leadership on the Social Security phase out plan.
”Conservative House Republicans, beset with growing distrust of the Senate, are urging the House leadership to jump ahead of the Senate on Social Security reform and pass a bill based on large personal retirement accounts and no tax increases or cuts in benefits.
”They also want House Speaker J. Dennis Hastert and House Majority Tom DeLay to say publicly that any bill sent over from the Senate that doesn't meet all these requirements will not be taken up in the House. […]
“Some Senate conservatives privately agree with their House counterparts that the Social Security debate has swirled out of control and that the situation is now playing into the hands of Democrats, who adamantly oppose partial privatization of Social Security. These conservatives say the only way to save the situation is for the House to pass a private-accounts bill and let the Democrats take the blame for blocking Senate passage.”As usual,
Josh Marshall says it better than I can:
”This would be a smart and gutsy strategy if phase-out were popular. But since every public poll available seems to show that it's not popular at all, it's not immediately clear why letting the Democrats stop this unpopular bill in the senate would necessarily be a bad thing for them. Indeed, common sense would suggest that stopping an unpopular piece of legislation would be something they'd be happy to do.
“For what it's worth, I doubt very much that it would currently be possible to get a phase-out bill through the House at all. But in purely political terms I have little doubt that the Democrats would love to see them try.” Ed Kilgore of New Donkey.com has an additional comment:
"I can barely begin to imagine how much you'd have to borrow--or cut from guaranteed benefits--to pay for this woofer, but we are probably talking about many trillions. I'm sure Josh or Max or somebody will soon enlighten us.
"Now, as Hallow explains, the House GOPers don't actually think their proposal will become law; it's all about shifting blame for failure to serve up this massive free lunch to the Senate and of course, those free-spending Democrats. But somehow, I don't think overt cynicism is much of an excuse for complete irresponsibility." The only
rational way I can see this happening is if the Republican leadership has written off the Social Security phase out bill for this year, and they want to pass something that sets up an agenda they can work off of in future years. Such a bill would give them a focus in the future as they continue to try to eliminate Social Security as a government guaranteed minimum retirement. They can also show that they have done something, and blame the Democrats adn the Senate for failed actions. They may also have new respect for the idea of rallying the base after seeing that Karl rove got Bush reelected by doing that.
The downside for them is the danger for Republican House Members who have to go home and run on a platform of "I voted to eliminate Social Security." But maybe they are remembering the old Goldwater slogan "A Choice, not an echo."
As for "rallying the base", George W. Bush was an unusual candidate. What worked for him may not work for other politicians. If the House tries this Social Security bill, a number of Republican House Members
will lose in 2006.
Commentary from the Heritage Foundation
The
L.A. Times published this commentary Tuesday.
The debate over Social Security reform so far has centered on the concern that, as the number of retirees balloons, the program won't be able to pay its promised benefits. That certainly is a crisis that must be addressed. But let's say, for argument's sake, that Social Security's finances were in great shape. Would reform still be necessary?
Yes, because of a bigger crisis that has nothing to do with the program's solvency. It's a personal crisis affecting millions of American working families: The program designed for the 1930s is shortchanging them and eroding their ability to save.Oh, yeah. A wealthy commentator who is spouting a line for the ultra-conservative Heritage Foundation wants the poor and lower middle class to be free of taxes so that they actually have more money to
save for their own retirement.
Blue Sky Bull Crap.
When my kids were small, there was no way I could save. If I didn't have FICA tax taken out of my check and a pension for my work, I'd have nothing. And I represent 30% to 50% of the workers in this nation.
That's why Social Security was needed in the first place! Just remember, Stuart Butler doesn't give a rat's ass for you or me. All he wants is more power and more wealthy people to pay him to spout his idiocy. As far as he is concerned each of us is entirely on his own, and empathy for others is quite beyond him.
AARP says Social Security legislation will not pass this year
Bloomberg News reports that AARP chief executive Bill Novelli said Congress is unlikely to pass a bill restructuring Social Security this year.
Then the
Hartford Courant reports a Democratic Congressman holding a town meeting on Social Security in the district of a Republican Congressman. The Courant goes on to point out
"Democrats believe an important way to gain voters is by tying Republicans to President Bush's teetering campaign to allow future retirees to have personal Social Security accounts."Stories like these suggest that both Social Security Phase Out and the Republican Party generally are in trouble at the moment. Of course, it is a long time to the next election, and I'm sure that was part of the calculation when Bush started his phase out effort right after the election.
Why are some Republicans not taking a position on Social Security? Follow the money.
Josh Marshall discusses the strange coincidence between the many Republican Representatives who will not take a clear position on Social Security phase out and the Republican Representatives who have recieved large amounts of cash from Tom DeLay.
Repubs to Pass SS Bill in July
Republicans in Congress and the White House say they expect to pass a Social Security Bill through both houses during July. White House Republicans say they have no fall-back position in case of trouble passing the bill.
Raw Story has the story.
Public education or propaganda?
How much is Bush charging the taxpayers to convince them to scrap Social Security? Sixty cities in sixty days, and you and I are paying for every city of it. Of course, don’t show up with a Democratic t-shirt or even a Democratic sticker on your car bumper because the Pres doesn’t like opposition and they won’t let you in. Not even if you have a ticket and a reservation. We are all paying for it, but it is really only for Republicans and any other sycophants they can find
The
Washington Post has a story on what is known so far.
”The Bush administration's ongoing Social Security blitz is unusual in scale in the selling of a domestic policy, mobilizing the president and vice president, four Cabinet secretaries and 17 lesser officials, down to an associate director of strategic planning for the White House budget office.
“It also may be one of the most costly in memory, well into the millions of dollars, according to some rough, unofficial calculations.
[…]
“The Treasury Department has hired four full-time employees to help run the show, including establishing a new Web site, www.strengtheningsocialsecurity.gov, and a war room, dubbed the Social Security Information Center. Yesterday, Treasury held a first-ever "radio day," opening its ornate Cash Room and 28 administration officials to nearly 30 radio talk-show hosts.”There’s a law that prohibits the government for expending funds for propaganda. Since this is so clearly just for the Republican Party, it seems to me that the expenses for this campaign should not be paid by taxpayers.
Down to the Politics Now.
This is from the
International Herald Tribune. Hans Reimer of Rock the Vote states the following:
“To us, it's totally black and white," Reimer said. "This is the first generation ever that would be asked to pay for their own retirement and Social Security at the same time. This is what private accounts do. They saddle young people with an unfair burden." Then we get the opposition:
Others vehemently disagree. Nicholas Tyszka, a Chicago-based Republican strategist, said that despite the difference in their demographics, it was not surprising that AARP and Rock the Vote were on the same side. "Both are extremely liberal organizations that use scare tactics to affect public policy," he said.Finally the newspaper offers poll results:
Young adults have been strong backers of Bush's proposal for months, but a poll released last week by the Pew Research Center for the People & the Press shows that support is slipping. Support among those ages 18 to 29 dipped from about 7 in 10 to just under half. A quarter of young adults said that they were unsure how they felt about such personal accounts. (AP) As I stated in
my earlier blog, the facts are all out in public and there isn’t anything new there. All that is left that is new is the twists and turns of politics as failing efforts are replaced by new efforts.
Above, Reimer makes a statement of fact and Tyszka has no retort except to claim Rock the Vote and the AARP are liberal organizations using scare tactics to influence policy. When the facts are scare tactics, do you really want to let the Republicans install their program? If you let them do it, you will pay twice for an inadequate retirement from Whatever they leave of Social Security.
Don’t expect facts from the conservatives, because they simply don’t have any to offer. When a politician has no facts or loses on the facts, then he attacks his opponent. Expect a lot of attacks in the near future.
The Boston Globe & Weekly Standard on the Politics of the SS Fight
There hasn't been anything substantive published on Bush's Social Security phase out initiative for a while now. All that's left is to discuss the politics as they play out.
Essentially now it is the Democrats refusing to go along with the Republicans and the Republicans trying one new scam after another to peel off a few (Republican term - "moderate" -- Democratic term - "turncoat") democrats so that they can claim a bipartisan solution. The
Boston Globe has this as the latest example. And why are the Democrats refusing to go along with anything the Republicans suggest?
Two reasons. First, it is no secret that the Republicans have wanted to phase out Social Security since it started and they see this as their chance to do it. Second, there hasn't been a single major initiative pushed through by the Republicans in the last four years in which the Republicans have dealt in good faith with the Democrats. How many times does Lucy have to snatch away the football at the last minute? Why should Democrats try to deal with people they can't trust?
Dealing with the Republicans on Social Security is not something that will benefit either the Nation or the Democrats. How do you deal realistically with someone as unethical as DeLay, Frist, or Bush? Answer? You don't.
Anyway, here is the
Weekly Standard's latest screed on the subject.
Good News to California Public Employees & Teachers!
Governator Schwartzenegger has backed off his threat to privatize the California Public Employees' Retirement System and the California State Teachers' Retirement System. (See this
AP report) These are the largest and third-largest pension funds in the U. S. and the Governator wants badly to change them from fixed benefit government pensions to fixed contribution pensions with no guarantee of any kind.
Schartzenegger wants to do the same thing Bush wants to do with Social Security, and the Californians have gotten wise to him.
Nancy Pelosi responds to Bush on SS Trust Fund
AP - Tuesday Bush went to the Office of Public Debt Accounting, opened a file drawer, held up a white notebook filled with pseudo Treasury securities* that represent the $1.7 trillion in treasury bonds that make up the Social Security trust fund, and stated “There is no trust ‘fund’ — just IOUs that I saw firsthand.”
Yeah, right. Now go look at your bank account. Guess what you have. Just IOUs from the bank. Look at your IRA or retirement fund. Guess what? Just IOUs.
Bush's grandstanding was not lost on Nancy Pelosi. This is from her opening statement at her
press conference Wednesday:
"This is the first time that a President of the United States has declared that we, the United States Government, will not put the full faith and credit of the federal government behind the Social Security trust fund. What this President is saying is, we have two kinds of debt. Let's see how we get the debt first. It is in deficit spending, so we have to go borrow in order to keep the government going.
So where does he borrow? He borrows from the Chinese. He borrows from the Japanese. He borrows from the trust fund. And what he is saying now to the American worker: "We will honor our debt to the Chinese and the Japanese, but we are treating you differently. We are not honoring our debt to you." These are funds that workers and their employers put in the account to have a trust fund to cover any shortfall that would be there to cover their retirement benefits. And this President is openly declaring that he has no intention of paying the trust fund back what he has taken from it.
"Over the break, I was pleased with my House Democrats. They had more town meetings, well attended, very enthusiastic. They have inoculated the public against what the President is trying to do. With education and information, it has become clear to the American people that the private accounts will undermine Social Security and that they are not the way to go.
"The President says he is going to 60 cities in 60 days. I want him to make it 100 cities in 100 days, because he is getting zero progress on his tour. The relationship between deficit spending and the solvency of Social Security is becoming clearer to the American people. And the more they learn about it, the less they like about what President Bush is proposing."[Underlining mine -- RB]
* Why "pseudo Treasury securities?" Because the real bonds are nothing more than entries in a computer. These pieces of paper are a public relations prop used by dignitaries who want to be photographed holding up pieces of paper that represent the Social Security Trust Fund of $1.7 trillion.
Private Accounts & CPI Indexing of Beneifts will Eliminate Social Security
A
new nonpartisan analysis (pdf file) of the President’s Social Security proposals show that it means guaranteed benefits will be phased completely out.
The nonpartisan Congressional Research Service (CRS) has found that President Bush’s proposals for Social Security would mean the end of Social Security’s guaranteed benefit. The Bush proposal’s benefit cuts start small. However, they eventually become so large that they reduce the guaranteed Social Security benefit to zero. At that point, individuals would have to rely solely on their private accounts.
The CRS analysis looked at the combined effects of the President’s private accounts proposal – as described in White House February 2005 statements – and the White House-advocated shift to price-indexing of Social Security benefits, as proposed by President Bush’s Social Security commission in a plan the President has described as a “good blueprint.”
The analysis confirms that private accounts are not a modest change to Social Security but eventually eliminate Social Security’s guaranteed benefit altogether. CRS found that a person born next year who has average earnings of about $56,000 over his or her career will not receive any guaranteed Social Security benefit at retirement.[Underlining is mine -- RB]
So it is totally fair to call the President's Social Security proposals an effort to phase out Social Security Benefits. That is exactly the result they expect.
Bush Says Everything is on the Table - Rove Says no.
Karl Rove says
April 5 (Bloomberg) -- Private accounts must be part of any permanent Social Security fix, said Karl Rove, President George W. Bush's deputy chief of staff, expressing optimism Congress will end a partisan standoff and pass such a measure this year.
``The personal retirement account has to be part of the long- term solution,'' Rove, Bush's chief political and policy adviser, said in an interview in Washington yesterday. ``The public and Congress are becoming aware that it's a serious problem.'' BloombergBut George Bush
said at his March 16th Press Conference
"Personal accounts do not solve the issue. But personal accounts will make sure that individual workers get a better deal with whatever emerges as a Social Security solution." If personal accounts really did offer a better deal for
workers, then they
would solve the problem within Social Security. But since when has the Bush administration been concerned with the problems of the American People? The only problems he acts on are those of the Republican Party, and Social Security
is a problem for the conservatives in the Republican Party. It is the single most successful social program the government has. That is the so-called
problem he is trying to solve.
The only reason for private accounts is conservative ideology. The lower income Social Security recipients will not get as good a deal as under Social Security's current guaranteed benefits, and the only way to achieve the switch to private accounts is for the government to borrow massive amounts of money to pay benefits to current recipients. This would be on top of the massive debt that Bush has already run up to pay the deficit he has already created.
The increased government debt would require higher interest rates, slow the economy, and probably cause inflation. Personal accounts are nothing but unnecessary trouble for this nation.
Bush and Rove's demand that any solution includes private accounts will mean that there is no solution during the Bush administration.
Illegal immigrants Help Fund Social Security
The
New York Times today points out that the illegal immigrants from Mexico who come here and work pay the FICA and Medicare taxes, but will not be entitled to benefits.
"...the estimated seven million or so illegal immigrant workers in the United States are now providing the system with a subsidy of as much as $7 billion a year. [...]the money added up to about 10 percent of last year's surplus - the difference between what the system currently receives in payroll taxes and what it doles out in pension benefits. Moreover, the money paid by illegal workers and their employers is factored into all the Social Security Administration's projections." So perhaps the solution to the Social Security problem is to simply open the borders to illegal immigrants and make sure that they can't draw benefits.
That's a joke, people. But it does indicate the high variability of the estimates that go into the projections. The further a projection is carried into the future, the more uncertain its accuracy is.
Your Social Security Number is You and It's For Sale
If you obtain someone's Social Security Number you are in a position to learn all about that person, from job to address to list of bills paid and credit card payments. It is the key to identity theft.
So why can brokers
sell anyone's Social Security Number for $35 to $45 dollars? There is no law against it, that's why. How much of a threat is this to your privacy and mine?
"No law prohibits the sale of Social Security numbers, but privacy experts and some government agencies have warned for years that the number is overused and under-protected."
Report that Social Security Forum Shut Down
This is a report that the National Park Service has shut down a forum on social Security to be held at the FDR library. Consider this an uncorroborated report until further information is available. Go
here.=======
Update on the story
here, with updated links.
CBO's Social Security Report
This is the
report on Social Security> by the Congressional Budget Office. It uses assumptions that are a little more positive and probably more realistic than does the recent report from the Social Security actuaries.
Keep always in mind that what the various reports do is provide a
projection of future revenues and benefits, not a
forecast. The distinction is very important. A projection is extremely dependent on the size of the various assumptions that go into it. A forecast is expected to be accurate. A projection is known to be more and more inaccurate the further into the future it goes because there is no way of projecting the behavior of the assumptions accurately.
So a projection is not a forecast or a prediction for the distant future. At best it is a warning of what might happen. It can only be expected to be somewhat accurate in the near future.
With this in mind, go look at the CBO's effort
here.
Sen Graham offers Social Security Plan
Senator Lindsey O. Graham offers
his plan to handle Social Security reform.
This article describes an interesting plan that, as they say, will make everyone angry. He appears to include the built in private accounts which is enough reason for Democrats to kill it quickly.
Then the rest of it seems to me to be overkill. It is still a lot more modification than the relatively modest apparent problem will require to resolve, and has an awful lot of Republican misunderstandings built into it. They've been listening to their own rhetoric, and need to get some real actuaries involved.
I predict that it goes nowhere this year.
Social Security Unlikely This Year, Hastert Says
Dennis Hastert, Republican Speaker of the House, doubts that the Congress can pass Social Security reform this year.
House Speaker J. Dennis Hastert (R-Ill.) has acknowledged that President Bush's call for completion of a Social Security bill this year could be unrealistic and that the legislation might have to wait until 2006.
The president's aides immediately responded by saying Bush is committed to winning passage this year. The White House and Republican congressional leaders have said repeatedly that the proposed restructuring of the retirement system is doomed if it does not pass this year, because it will be even more difficult to get Democratic support in 2006, a midterm election year. Personally, I doubt they will get any Democrats this year, either. Private acounts and trillion dollar loans to fund them simply are too much to swallow. They are completely unresponsive to the apparent problem that might occur in four or five decades. If the Republicans continue to try to get the private accounts in 2006 it will be little more than a gift to Democrats running for election in November 2006.
