a valid question...

[acroyear]

"if Social Security privatization is supposed to be about making "younger workers" better off, as Bush has said, will he please explain why piling yet more debt on their backs should make them grateful?" -- Editorial on Social Security reform at the 'Post.

Comments

[rsteachout.livejournal.com]

Short, simple answer (which I pointed out over a month ago in answer to dawnstar92's questions re: SS.

The choice isn't "pile on more debt" v. "no extra debt": it is "allow the massive, megakiller, overwhelming, destroy-the-entire economy debt that we *know* we're gonna have to clobber us" v. "take on more debt now to eliminate the far worse monster of debt later". The calculations have been in for decades: when (not if) the SS system as we have it (and as Kerry & the Dems swore they would not change) self-destructs in a massive bankruptcy (most hurting those who are our age), the cost will overwhelm the economy and we will have to take on "more debt" to the tune measured in 100's of trillions -- instead of the relatively cheap few trillion (up to 10 trillion in transition costs according to one figure quoted during the election) that the privitization plans being proposed will cost.

Now, a couple of interesting things I noticed from reading the editorial:
1. Bush is being criticized for suggesting that SS be taken "off budget". This, according to Mr. Dionne, makes the budget look healthier (actually, it will make the budget look worse - more in a second). What's ironic, is this is the same thing the Gore was lauded for/mocked for during his run when he wanted to "put SS in an iron-clad lockbox." The only way to put SS funds out-of-reach is to seperate them from the rest of the nation's budget; i.e. exclude them from the vast, single pocket that is the U.S. accounting system. This *could* help somewhat, but all Congress has to do is pass a law allowing them reaccess to the funds and we're back in the same hole. What Mr. Dionne *should* have noted (and that he didn't shows he's either uninformed about SS, or he's being deliberately dishonest with his readers) is that this plan *worsens* -- not improves -- how bad the deficit appears by removing the budgetary offset that the current SS *surplus* provides. It is also ironic that Bush is being mocked/accused for promising the same thing the Democrat's (okay, and every other politician) have been promising for years -- everyone will get their money and we can do it without raising taxes or lowering benefits or even having to say "owwie." Even more ironic is that the talking points of the Repubs/Bush and Dems have flopped, with each party using the lines advocated by the other and denounced by themselves four years ago.
2. Most of Mr. Dionne's article doesn't even focus on the current proposal, but on the privitization proposal that was put forth 4 years ago. That proposal was made under very different circumstances (pre-war, and when there was a projected Republican-Congress created surplus of a couple of trillion, rather than the current projected war-deficit of a couple of hundred billion). It's not even until the 11th paragraph (out of 14 total) that Dionne gets to the "breaking news" -- that its being suggested that the U.S. can "borrow" (i.e. deficit spend) to cover the cost.
3. The quote on how much might need to be borrowed isn't actually a quote by the Bush official interviewed, but is actually a quote by a NY Times editorial writer speculating on potential costs -- hence, a non-quote that Mr. Dionne tries to slip past as "evidence" of "admitted" costs. (Note how cleverly he inserts the "quote" in an aside to make is look like it is attributable to the Bush official, when it is actually "noted by" the editorial writer).
4. There are a few other little tricks that Mr. Dionne is using to greatly inflate his "case" against the president. How many more can you find? At least two, I hope, or you're not being a critical/skeptical reader.
I certainly hope this isn't the usual quality of article by Mr. Dionne. If so, he would seem to be a very dishonest writer. His positions can be supported more strongly with good reasoning and principled points backed by informed opinions and views of scholars and experts and without the use of the flim-flammery and tricks that he's used here.

[acroyear70.livejournal.com]

1) it kinda depends on what is meant by "off budget". if the expenses are removed from the budget, but the income revenue is not (meaning current expenses only come from the existing load), then it looks very good for the budget, only the SS will be depleted much more rapidly. i doubt anybody's proposing that, but its an interpretation that can be read into the editorial since "off budget" isn't explained.

2) i certainly agree that the current system will NOT pay for the boomers when they hit their stride in the next 5-10 years (my own parents qualify for main checks in 8, and dad's already looking at social security disability pay as a result of his stroke). i also don't think in the short term that the privatization in and of itself will remove so much of the "cash in the bank" that current recipients will run out of money anytime soon.

however, the privatization plan does favor those who actually bother to pay attention to stocks and growth markets and all that crap. most people don't want to (and as the dot-bomb and the many internet scams show, most people wouldn't know a good market from a bad in any instance). so conceptually, the plan favors those already good at investment (and willing to invest the time it takes to manage investments), who also happen to be those least likely to be in need of such a plan.

i'm not so sure the "irony" (of repubs and dems changing places on this plan) is really there. this plan favors investors, and investors *tend* to favor incumbent government officials over the upheaval of developing whole new lobbying efforts to freshman congressman and new presidents. This issue may have been an issue lobbied for by investors, not a "bright idea" from either party's own leadership, and as such, the lobby goes to who's already in there.

Both sides now have majorities in places that the other sides used to have years ago (republicans in the rich industrial north (outside of city labor), dems in the rural south was the "rule of law" handed to me in my 12th grade gov class) and as such, many aspects of the sides have changed hands or are still in transition. A recent comparison map of 1860 shows the republicans having taken all the states that used to be "slave" states (or territories) -- the parties have almost entirely changed sides but geographically the country is exactly as divided as it was 150 years ago (at least at the state level).

this implies that the parties have been changing slightly to solidify their baseline in the states they dominate in, by taking on other issues that were once the exclusive of the other party when that other party held that state. and especially in the south, all that is recent.

3) ok, this is annoying. i get extremely tired of "out of context" (or irrelevant source) quotes from the right-side pundits (hannity and coulter are masters of it). just because it seems to work for them doesn't mean the left has to follow suit.

[acroyear70.livejournal.com]

4) certainly the use of the phrase "i'm not making this up" is a tell-tale sign (i read it as such when i first saw it). that phrase is used repeatedly by pundits on both sides (Rush and Coulter love it, as does Franklin but he wouldn't admit it). and both sides generally get the analysis they're "not making up" from someone who (guess what?) made it up.

better to include more citations (or do your own damn analysis if that's what you're paid to do) than to just leave a few things unreferenced (or to have the references be out of date, as you noted). Yes, Bush said he wouldn't do the deficits he's doing, and yes maybe his administration feels its necessary since the 1-2 of dot-bomb + 9-11 changed the economy (and tax income even before the 2nd round of cuts) rather drastically. but 9-11 as an excuse is only going to last for so long...

i don't think it was as necessary to run up the debts he's running and i certainly don't understand how the numbers got so drastically bad. Personally, i'm guessing that adjusting for inflation or comparing as percentage of the GNP, FDR's deficits were likely worse, though so was the economic situation.

back to Mr. Dionne, I also had a problem with the phrase "since Bush hasn't been punished so far..." implies that the deficit is criminally wrong, or at the very least, that Bush was being a naughty boy when he started it. its an emotion-inducing statement that has no real meaning in government. the only "punishment" would have been not being elected or for congress to call him on it and come up with a budget without those deficits (technically, its their job). neither happened.

now, it would have been different if Graham-Rudman had any teeth to it, but it didn't, so it doesn't.

correction

[acroyear70.livejournal.com]

I meant "Franken" not "Franklin".

[voltbang.livejournal.com]

I want to buy out of the ponzi scheme and then make charity payments to cover the poor bastards who were forced to stake their life savings into it, and who were fooled into thinking it would cover their retirement. I'd prefer paying for an honest bail-out to pretending that the system isn't broken until maybe I could be the one depending on a bail-out. Ponzi schemes are illegal for everyone else, I don't think that the massive scale the federal government used to make it work should make it ok for them. Bush has shown a complete lack of financial restraint so far, but apparantly even he can see a con-job for a con-job. Once you get this far into the game, there's no easy way out. Do we pay for it now, soon, later, or hope to pass the problem off to our kids? I'd rather just fix the mess now.

[acroyear70.livejournal.com]

yeah, but the issue in passing off the problem to our kids is the fact that we're passing a very different (and potentially less manageable) problem to our kids. fix SS now and find that the debt is so out of control that nobody can fix it...or worse, run up the debt and deficit spending to an irreversable point and then find that nobody will give us credit anymore...

[voltbang.livejournal.com]

Our parents bought into the ponzi scheme. Now we are stuck with having to pay for it. No matter what we do, many of them failed to take steps to cover their retirement, because they had been scammed into thinking it was paid for. So, being as our shared values say we can't let them starve, we have to cover their bad decision. The money is lost. It's gone. Now, we can admit that and try to find an answer, which yes, will involve either us (people working now) paying money, or passing the debt along in some way, or pretending that SS isn't a scam, and making the problem bigger.

Our budget is an issue, but it's not this issue. We can't put off this problem because of other problems. If we do that, this problem will never be solved. It's never a good time to tackle a major money problem, especially one that is on maintenence, there's always something more attractive to spend the money on. We spend the money now, we fix it, and that debt is money we pay off over time. It's just a debt, so we have to tighten our belts some. Not a big deal. We don't pay it, and we end up with a huge population of elderly people with no money, looking to a small population of young people and demanding food, shelter, and medicine so expensive that it will make the young people wish that the old people just wanted big screen TVs. I can't see zero retirement savings as the managable problem to hand off to our kids. Ponzi schemes suck, but they suck worse when people lose their life savings, and that's the situation we're in now.

[acroyear70.livejournal.com]

and actually the problem today was one that couldn't have been predicted back then. the numbers that justified SS at the time were based on a population growth figure that made sense at the time, but didn't account for education leading to planned parenthood, improved health care extending the lifespan, and birth control causing the birth rate to hold relatively steady. (America grew from 210mil to 280mil from 1970 to 2000, compared to planet-wide growth from 3 billion to 6 billion).

had America grown at the rate of the rest of the world, the population between 20 and 40, paying for those who are 60, would have been 2 or 3 times what it is, and likely the money would be there no problem.

[voltbang.livejournal.com]

It would have worked longer, but ponzi schemes always break down. What could have worked is if SS had been a bailout for the poor (as originally intended), and not a universal retirement plan.