December 17, 2004

• Discussion is fine but who is listening? This is just like the pre-election chatter that had everyone convinced that Kerry was going to win. Balderdash! Bush has a mandate and we are getting $X.Y trillion more in debt, end of story. Merry Christmas!
• Isn't less participation bad for a pyramid scheme?
• Isn't less participation bad for a pyramid scheme? Oh ye of little faith-based faith. Get thee to an Afghan cave with the rest of the terrorists who hate America.
• i think bush has forgotten that social security is a safety net for those to stupid to properly invest their money so they aren't homeless in thier old age...
• i think bush doesn't give a rat's ass that social security is a safety net for those to stupid to properly invest their money so they aren't homeless in thier old age...
• Well, I guess I'm stupid, but I really wouldn't know what to do with my cash. No way am I sinking it in the frigging stock market. If the dollar keeps slipping, will IRAs, 401k's, and CD's still be as safe as SS?
• I think Bush and Co. saw all that Social Security money that they couldn't get their hands on and came up with a scheme to redefined SS as an individual investment plan so they could get the money into the stock market where they CAN get their hands on it.
• The bigger problem is that, like it or not, our economy is extremely shaky. A real Social Security crisis could collapse it. I believe the "big idea" behind this is to get the SS funds into the Stock Market for the purpose of shoring it up. Which is, unfortunately, still a short-term solution which will result in our market being even MORE dreadfully overvalued, even as the REAL value of our products and currency continues to decrease overseas thanks to Bush's monetary policies. Then one day the house of cards crumbles, and he's just trying to make sure it doesn't happen on his watch.
• What I don't understand is this: • SS taxation removes interest-earning revenue from the budget • capital gains (profits from stock market) are not taxed anymore So where is all this money coming from? I mean we can't even afford Iraq and we're taking this on now. Can't we impeach presidents for deliberately putting our country in the poor house?
• There is no "social security crisis." There's enough money in the SS trust to last another 30 years. Take away bush's tax cuts to those making $500k+ a year and put it into SS and it'll last over 100 years. When SS runs a surplus, the extra money pays for other gov't spending, so why shouldn't other gov't taxes pay for SS when it runs a deficit? This is class warfare, plain and simple. The plan is to damage a very successful social program that helps people who don't make enough money to save for retirement, while benefiting the rich people on wall street. I'm perfectly willing to contribute a portion of my salary to help people who are too old to work and who would otherwise be poor (starving, homeless, etc). That's because I AM NOT A SELFISH CUNTRAG. For such a religious nation, we really suck at being christian.
• Alex- to paraphrase Lewis Black: "YOU CAN'T JUST FUCKING....THERE IS NO...YOU...FUCK...YOU JUST MADE THE FUCKING MONEY UP THERE IS NO MONEY YOU FUCKERS MADE IT UP!!"
• HawthorneWingo, there is much to be said on this and where Bush is comming from it's mostly BS.! The likely scenario; Privatization would begin by diverting payroll taxes, which pay for current Social Security benefits, into personal investment accounts. The government, already deep in deficit, would have to borrow to make up the shortfall. This would sharply increase the government's debt. Never mind, privatization advocates say: in the long run, they claim, people would make so much on personal accounts that the government could save money by cutting retirees' benefits. The government would, in effect, confiscate workers' gains in their personal accounts by cutting those workers' benefits. There is, by the way, a precedent for Bush-style privatization. One major reason for Argentina's rapid debt buildup in the 1990's was a pension reform involving a switch to individual accounts - a switch that President Carlos Menem, like President Bush, decided to finance with borrowing rather than taxes. So Mr. Bush intends to emulate a plan that helped set the stage for Argentina's economic crisis. If Mr. Bush were to say in plain English that his plan to solve our fiscal problems is to borrow trillions, put the money into stocks and hope for the best, everyone would denounce that plan as the height of irresponsibility. The fact that this plan has an elaborate disguise, one that would add considerably to its costs, makes it worse.
• "social security is a safety net for those to stupid to properly invest their money" I'd like to take a second to address this. You realize that there's a good chunk of people who don't have the spare money to save, right? Even assuming that, were they to retain all their SS taxes (employee + employer), they would have 12.5% more income. That doesn't amount to much spare cash if you're already hovering around the poverty line, and is not an amount which can simply be "properly" invested. Social Security is a safety net for people who can't afford to properly invest their money.
• There's enough money in the SS trust to last another 30 years. Take away bush's tax cuts to those making $500k+ a year and put it into SS and it'll last over 100 years. Somewhat OT: Forecasts about an economy as huge and complex as America's 100 years into the future strike me as absurd. But then I never got past Econ 101/102 in college, so what do I know.
• HawthorneWingo, Privatization dissipates a large fraction of workers' contributions on fees to investment companies.It leaves many retirees in poverty.Decades of conservative marketing have convinced Americans that government programs always create bloated bureaucracies, while the private sector is always lean and efficient. But when it comes to retirement security, the opposite is true. More than 99 percent of Social Security's revenues go toward benefits, and less than 1 percent for overhead. In Chile's system, management fees are around 20 times as high. And that's a typical number for privatized systems. These fees cut sharply into the returns individuals can expect on their accounts. In Britain, which has had a privatized system since the days of Margaret Thatcher, alarm over the large fees charged by some investment companies eventually led government regulators to impose a "charge cap." Even so, fees continue to take a large bite out of British retirement savings. A reasonable prediction for the real rate of return on personal accounts in the U.S. is 4 percent or less. If we introduce a system with British-level management fees, net returns to workers will be reduced by more than a quarter. Add in deep cuts in guaranteed benefits and a big increase in risk, and we're looking at a "reform" that hurts everyone except the investment industry. Advocates insist that a privatized U.S. system can keep expenses much lower. It's true that costs will be low if investments are restricted to low-overhead index funds - that is, if government officials, not individuals, make the investment decisions. But if that's how the system works, the suggestions that workers will have control over their own money - two years ago, Cato renamed its Project on Social Security Privatization by replacing "privatization" with "choice" - are false advertising. And if there are rules restricting workers to low-expense investments, investment industry lobbyists will try to get those rules overturned. For the record, I don't think giving financial corporations a huge windfall is the main motive for privatization; it's mostly an ideological thing. But that windfall is a major reason Wall Street wants privatization, and everyone else should be very suspicious.
• HawthorneWingo, Then there's the issue of poverty among the elderly. Privatizers who laud the Chilean system never mention that it has yet to deliver on its promise to reduce government spending. More than 20 years after the system was created, the government is still pouring in money. Why? Because, as a Federal Reserve study puts it, the Chilean government must "provide subsidies for workers failing to accumulate enough capital to provide a minimum pension." In other words, privatization would have condemned many retirees to dire poverty, and the government stepped back in to save them. The same thing is happening in Britain. Its Pensions Commission warns that those who think Mrs. Thatcher's privatization solved the pension problem are living in a "fool's paradise." A lot of additional government spending will be required to avoid the return of widespread poverty among the elderly - a problem that Britain, like the U.S., thought it had solved. Britain's experience is directly relevant to the Bush administration's plans. If current hints are an indication, the final plan will probably claim to save money in the future by reducing guaranteed Social Security benefits. These savings will be an illusion: 20 years from now, an American version of Britain's commission will warn that big additional government spending is needed to avert a looming surge in poverty among retirees. So the Bush administration wants to scrap a retirement system that works, and can be made financially sound for generations to come with modest reforms. Instead, it wants to buy into failure, emulating systems that, when tried elsewhere, have neither saved money nor protected the elderly from poverty. And a last fact, one third of the present social security recipients were either forced to leave the work force early from disability or are survivor dependents that may never had an opportunity to save do to a short working career. See Social Security is more an insurance plan for the family as it is also a retirement account, which is something a private saving account would find hard to match. If Bush gets his way it will certainly be a big time loss for anyone born after 1943. I'm talking to all you in particular that make up the group known as," Generation Debt"
• What's the Social Security situation in Canada? Can any Canucks chime in on the discussion?
• ScrewDriver, why are you repeating stuff from my links back to me? Example: From my Thomas Friedman link, For the record, I don't think giving financial corporations a huge windfall is the main motive for privatization; it's mostly an ideological thing. But that windfall is a major reason Wall Street wants privatization, and everyone else should be very suspicious. From ScrewDriver comment, For the record, I don't think giving financial corporations a huge windfall is the main motive for privatization; it's mostly an ideological thing. But that windfall is a major reason Wall Street wants privatization, and everyone else should be very suspicious.
• Conclusion: ScrewDriver is Tom Friedman.
• Eureka!
• For the record, I don't think giving financial corporations a huge windfall is the main motive for privatization; it's mostly an ideological thing. But that windfall is a major reason Wall Street wants privatization, and everyone else should be very suspicious. Paul Krugman wrote that. He's an economist the conservative bloggers hate. Yet they fail to acknowledge that Krugman worked in the Reagan administration.
• Right, Krugman. D'oh.
• So does that mean ScrewDriver is Tom Friedman, or Paul Krugman?
• What's the Social Security situation in Canada? We have Old Age Security and Canada Pension Plan. OAS is financed from federal tax revenues, while CPP takes money directly from employees' pay cheques with matching employer contributions. Health care dominates our political discourse; I rarely hear debates about pensions. OAS gets few mentions lately, because it takes from tax revenue and our government has balanced its budget since 97. "Balance" in Canadian means running a big surplus to pay down the debt and anger oppositions left and right. CPP is supposed to be fine for quite a while (eck, another 50-year forcast). The right-wing media predictably disagrees. I think CPP will be fine as long as our government increases the contribution rate to pay for retiring boomers, as the Liberals plan to. Since boomers vote and youths don't, it's a political no-brainer. [wallows in bitterness]
• A pair of solid arguments in favour of SS privatization. I would like to see them refuted, but haven't had time to do the legwork myself yet.
• He argues that privatization would eventually "transition" SS funding from payroll tax to income tax. Does anyone believe the GOP would ever raise income tax? Or that the oh-so-powerful Democrats could force them to? I like his idea to raise the retirement age, indexing it to life expectancy. Have always thought that to be the *only* sustainable solution in the long term.
• I still like the idea of nixing benefits for retirees who are already rich. If you get to 65 and you are a multimillionaire, then you're automatically a charitable multimillionaire, since you get none of your SS withholdings back. It's not fair, but I've never been in favor of fairness to support greed.
• The Bushies' war on Franklin Roosevelt.
• Maybe our liberal psyche is lacking in that we can't get back any further than Nixon for someone to point at as the cause for everything bad. On the other hand, that may be because the roots of the Great Great Depression were so diverse. It is interesting, though, that Bush has followed Roosevelt's tactics, with a different beneficiary. If you scroll down in the Wikipedia article End of the Depression, you'll find that deficit spending and a war econonmy are credited with getting the country back on course. So ,is the war in Iraq, which gave us huge deficit spending, Bush's administration's attempt to copy Roosevelt? I don't think the current deficit/war economy have created jobs nearly to the extent that they did in the US in the 1940s, but they do have benefits for the privatised war service providers. Well, we've all done a lot of this before, but I think it's interesting the the conservatives may be copying Roosevelt while trying to dismantle social security.