Bush’s Social Security plan?

[Brown]

To be fair, we haven't seen the plan yet, if there is one to let us see.

Here is, in it's entirety, little Bush's answer three days ago as to how Social Security reform and personal accounts would address the problem of insolvency. Remember, this answer comes from the President of the United States and is taken from the White House web site. I have left Bush's words exactly as they appear on the White House web site:

THE PRESIDENT: Because the -- all which is on the table begins to address the big cost drivers. For example, how benefits are calculate, for example, is on the table; whether or not benefits rise based upon wage increases or price increases. There's a series of parts of the formula that are being considered. And when you couple that, those different cost drivers, affecting those -- changing those with personal accounts, the idea is to get what has been promised more likely to be -- or closer delivered to what has been promised.

Does that make any sense to you? It's kind of muddled. Look, there's a series of things that cause the -- like, for example, benefits are calculated based upon the increase of wages, as opposed to the increase of prices. Some have suggested that we calculate -- the benefits will rise based upon inflation, as opposed to wage increases. There is a reform that would help solve the red if that were put into effect. In other words, how fast benefits grow, how fast the promised benefits grow, if those -- if that growth is affected, it will help on the red.

Okay, better? I'll keep working on it. (Laughter.)

About the only thing that seems to be clear in this stinking sack of fertilizer is that there still is nothing coherent that could be diginified with the word "plan." Somehow (the president doesn't say how), personal accounts will change the "cost drivers," which will allow Social Security payments to be closer to "what has been promised." This is just more Bush bull****.

The president himself doesn't understand what's going to happen, and he sure as hell can't explain it or how it will work to solve the problem, but he nevertheless pleads for public support. If the president would set forth a plan that stands on its own merits, he might find that he'll get widespread and bipartisan support. But he spends so much effort on trying to define the problem, and so little effort on developing a solution, that it is virtually impossible for him to build a consensus.

 

[Random]

I think the problem that the Bushies have is that as soon as an actual “Plan” with numbers and stuff is put out there, some unscrupulous Democrat will read it, figure out what people would make with it compared to keeping the current system, and then (here is the worst part) tell people about it. This must be prevented at all costs. My guess it that there will be some sort of procedural gag rule imposed on discussing it with the public as soon as the actual “plan” is put forward. I can honestly see Tom DeLay trying to sneak this multi-trillion dollar transformation of a beloved seventy year old government program through in one of his “midnight sessions”.

 

[Silicon]

Since conservatives (Wildcat, etc...) are so sure that the private plans will have much higher returns than the current system, why don't we actually have a govt guarantee of minimum returns mirroring SS returns? If conservatives are so sure private plans will provide better returns that the current system then guarantee it.

BRAVO, Lurker.

That's the essense right there.

Here's the problem, from the Center on Budget and Policy Priorities:

* For people born between 1980 and 1990 (age 15 to 25 today), their annual benefits under the Graham plan would be nearly $7,400 (or 36 percent) lower than under the current benefit structure and $6,600 (or 34 percent) lower than what they would receive if no action were taken to shore up Social Security.

* For people born between 2000 and 2010, their annual benefits under the Graham plan would be 50 percent lower than under the current benefit structure and 34 percent lower than what they would receive under the “do nothing” scenario.

http://www.cbpp.org/2-2-05socsec2.htm


Now that comes from a group that has analysed the data, and come up with the numbers for the "Graham plan" which was proposed by Senator Lindsay Graham. It's what's called the "Model 2 Plan" and it's the closest thing we have to a detailed plan that matches the sketchy outlines provided by the President.

The CBPP has an agenda, and that agenda is to protect the low-end of wage earners. Which is why I am skeptical of this analysis.

BUT.

All we need is a chart like this, from the CBO, of the President's plan. One that shows how much a median earner is promised, how much they'd get back by the current "crisis" solvency, and how much they'd get back under the privitization plan.

That'd SEAL THE DEAL for ALL Americans. Show me the numbers from the CBO that says I'd get more money, Mr. President. And tell me why that's better than raising the cap on earnings subject to payroll tax. Or why it's better than reducing the payouts by giving tax breaks to people who opt into a later retirement.


Because RIGHT NOW, the only numbers we have say that we'd get LESS with the president's system than if we DID NOTHING.

 

[Elind]

Eh? Solvency is still being addressed. They are just not pitching private accounts as a solution (and rightly so since they don't affect solvency).

I'm not sure where your going here.

I listened, and Bush most certainly gave the impression that the privatization part was a key component of the "solvency" issue in the long term, although he did leave details open to discussion. But if it is not a solvency solution, why does he keep talking about that aspect more than any other? Either he doesn't understand it or he is slipping this in as an article of economic "faith" in tax givebacks, whatever the form.

Personally I think it's both, but it's not a question that is going to remain hidden for long.

 

[Bjorn]

Here is, in it's entirety, little Bush's answer three days ago as to how Social Security reform and personal accounts would address the problem of insolvency. Remember, this answer comes from the President of the United States and is taken from the White House web site. I have left Bush's words exactly as they appear on the White House web site.

I can only repeat myself then:

We haven't seen the plan yet, if there is one to let us see.

 

[Lurker]

What I don't understand is why would the President be out trying to drum up support for a plan that he has not even released all the details of yet? Shouldn't I be privy to the details of the plan before I make a decision whether it is good or bad for the country?

Lurker

 

[Brown]

I can only repeat myself then:

We haven't seen the plan yet, if there is one to let us see.

Eventually, I expect we will be asking the following question: If there is indeed a plan, will the president be able to articulate it? Will he understand it well enough that he: (a) will be able to explain it to the people; and (b) will be able to answer questions about it in a coherent and intelligent manner?

I suspect that the president would be better off appointing a "front man" (or "front woman") to explain the plan and to answer questions about it. This would not be unusual. Past presidents have deferred to their specialists when presenting complex or difficult-to-describe proposals, and little Bush himself has delegated the job of "making the case" for other proposals to others.

The use of a "front man," properly employed, can also be useful for consensus-building.

 

[Elind]

What I don't understand is why would the President be out trying to drum up support for a plan that he has not even released all the details of yet? Shouldn't I be privy to the details of the plan before I make a decision whether it is good or bad for the country?

Lurker

Because he has faith?

 

[Random]

What I don't understand is why would the President be out trying to drum up support for a plan that he has not even released all the details of yet? Shouldn't I be privy to the details of the plan before I make a decision whether it is good or bad for the country?

Lurker

It’s the Monte Hall approach to governing.

Do you want regular ordinary Social Security, or do you want to take behind door number two? Now, what can I tell you about what’s behind door number two? Your payment would go into something with your name on it. I can see our crowd of wall street lobbyists are telling you to take what’s behind the door, but I see you hesitating. What if I threw in an envelope of money for your kids? Now, I can’t tell you how much is in the envelope, but there are at least fifty bills in this envelope, and they would all go to your kids. Now, I see you looking at the door, wondering what’s inside it, and there could be something really good in there, but you won’t find out unless you decide to take it. Let’s ask our audience what they think…

 

[SezMe]

Somehow, in all the confusing statements about Social Secuirty deform , I missed ...

Perfect slip of the keyboard, there.

 

[SlippyToad]

Look, you people don't have to respond to this, but just ask yourself what you would do if you invested your money in the stock market and lost it all. Really ask yourself the question. Don't go into how unlikely it is, don't retreat into talk about average returns and dividends, don't say "well at some point I'd switch to bonds", and don't chicken out and say "them's the breaks" or "that wouldn't happen". Seriously ask yourself what you would do if you hit retirement age and found you had nothing.

I think people who are behind Bush's "plan" are people to whom this is never going to be an issue. People who already make a lot of money, have little or no debt, have money left over at the end of the month to do something besides rent a movie, and are generally oblivious to basic concepts like society. Either that, or as Molly Ivins points out, they're too dumb to do the math to realize that Bush's plan fixes nothing and wrecks the system at the same time.

This plan isn't a fix. It's a bait-and-switch. The only purpose I can see for it is to continue "starving the beast." The only reasonable end I can see for it is to bankrupt our government and turn the US into a third-rate bananna republic.

 

[jay gw]

In 1983, three Texas counties shifted their government pensions out of Social Security and into privately managed accounts.

This story, on National Public Radio, shows what's happened when someone moves from Social Security to private accounts. They interviewed some workers who say that they would have been much better off, some by hundreds of dollars a month, if they had stayed with Social Security.

Basically, the private accounts work really well if you earn alot. If you're low or middle income, they don't work and you end up worse off than if you had stayed with Social Security.

It seems odd that someone has to "sell" what's supposed to be a great plan. Why isn't it obvious to everyone that it's great plan?

http://www.npr.org/templates/story/story.php?storyId=4493369

 

[jay gw]

In 1999 the Government Accountability Office studied private accounts.

They found:

- Social Security was better for low and middle income workers
- private accounts were better for high income workers
- even for higher income workers, if you live long enough, Social Security outperforms stock and bond market private accounts
- Social Security adjusts for inflation. Private accounts do not adjust for inflation.

The reason that Social Security is better for most people is because SS contributions go up as your wages go up. Private accounts only allow you to put the same amount in each year.

 

[SlippyToad]

In 1983, three Texas counties shifted their government pensions out of Social Security and into privately managed accounts.

This story, on National Public Radio, shows what's happened when someone moves from Social Security to private accounts. They interviewed some workers who say that they would have been much better off, some by hundreds of dollars a month, if they had stayed with Social Security.

Basically, the private accounts work really well if you earn alot. If you're low or middle income, they don't work and you end up worse off than if you had stayed with Social Security.

It seems odd that someone has to "sell" what's supposed to be a great plan. Why isn't it obvious to everyone that it's great plan?

http://www.npr.org/templates/story/story.php?storyId=4493369

This is par for the course. Of something like seven examples I saw in one story, including Britain and several Latin American nations, only one national privatized pension system wasn't seriously in trouble after a decade or more, and even that one (Chile's, I think) was getting ready for a major sh**storm. Example after example of privatized pensions show that they are a complete and utter failure, but you can't get the BushCo morons to admit it.

Right after the election, I had the joy of watching Bill Moyers interview Grover Norquist, Serious Conservative Imbecile, on PBS. I guess nowhere else in the entire SCLM would you be able to find someone willing to ask Mr. Norquist what he expects people who make $14,000 a year to do under the proposed "ownership society." Norquist listened to the taped footage of a real woman who really made that much money, and simply ignored the stark realities like they didn't exist. Instead, he began speaking stirringly of how Serious Conservatives were there to "help" people like this by giving them tax breaks and helping them invest the money. I had to scream, at this point. The idea of someone paying actual bills, of which Serious Conservatives are apparently unaware, on a $14,000 yearly income, and then taking what was left over and investing it in the stock market made me laught to wet my pants! Was she supposed to invest her f**ing food stamps?

At any rate, Moyers didn't quite savage him in the way I thought he deserved, but at least he didn't nod sagely and say, "of course, Grover, that's how it ought to be."

At any rate, yes people who make tons of money already are the ones who will benefit the most from this, and also coincidentally are the people who are least in need of a social safety net. But you can't apparently tell them this because waitresses busting their asses for a guaranteed $2.13 an hour are lazy, or something.

 

[Random]

Right after the election, I had the joy of watching Bill Moyers interview Grover Norquist, Serious Conservative Imbecile, on PBS. I guess nowhere else in the entire SCLM would you be able to find someone willing to ask Mr. Norquist what he expects people who make $14,000 a year to do under the proposed "ownership society." Norquist listened to the taped footage of a real woman who really made that much money, and simply ignored the stark realities like they didn't exist. Instead, he began speaking stirringly of how Serious Conservatives were there to "help" people like this by giving them tax breaks and helping them invest the money. I had to scream, at this point. The idea of someone paying actual bills, of which Serious Conservatives are apparently unaware, on a $14,000 yearly income, and then taking what was left over and investing it in the stock market made me laught to wet my pants! Was she supposed to invest her f**ing food stamps?

Well, Grover's not right-wing, he is stark raving bonkers right-wing. A while back on "Fresh Air", he compared the idea of progressive taxation to the Holocaust. When host Terry Gross asked him, "Excuse me, did you just compare taxes to the Holocaust?", Grover said no that what he meant to say was... And then he compared progressive taxation to the Holocaust again!

 

[SlippyToad]

Well, Grover's not right-wing, he is stark raving bonkers right-wing. A while back on "Fresh Air", he compared the idea of progressive taxation to the Holocaust. When host Terry Gross asked him, "Excuse me, did you just compare taxes to the Holocaust?", Grover said no that what he meant to say was... And then he compared progressive taxation to the Holocaust again!

I think Norquist is actually really frightening. His idea of conservatism apparently involves dismantling democracy on the way to . . . I don't want to know what. I feel it important to point out that his "starve the beast" scheme, which is taken seriously by all manner of people who should know better, basically involves bankrupting our government. In other words, starving the world's longest contiguously-functioning democracy to death.

If he wasn't such an easily-mocked imbecile it would be even scarier. There was a bit on the Daily Show (which I used to have a link to on the net, but which has been sadly archived) showing Norquist talking about putting Reagan on the $10, and how Hamilton was the only non-president on our currency. At which point Black rhetorically bet him $100 that he was wrong (cut to a picture of Benjamin Franklin, never elected President, staring out of a $100 "Benjamin".) I haven't seen that many $100 bills in my life, but I'm sure Norquist has. You'd think, at least?

 

[SlippyToad]

Bush has thrown out general ideas, not a specific plan. He has invited Congress to come up w/ the details developed through a bipartisan effort. But the Dems won't even go to the table to talk.

Gee, they wouldn't be gun-shy after having been lied to through Bush's teeth about Medicare, would they? Or Iraq?

As for your gloomy projections that absolutely nothing can be done without crashing the economy, those are straight out of the Talking Points that assume the economy will grow at a Japan-like stagnant pace, if at all, for the next 50 years -- which of course become rosy-bright when we talk about investing that money in the stock market. So forgive me (and the Dems) if we are a little suspicious about those claims. As has been stated elsewhere, a moderate increase in taxation on the uber-wealthy, and a similar adjustment to the retirement age to take into account longer lifespan, would probably put us in the black for a long time to come.

There is no crisis.