Social Security Reform Threatened by Elitist Liberals

[travis2]

Social Security Reform Threatened by Elitist Liberals (http://www.woai.com/news/news_commentary/story.aspx?content_id=EEAEDA5A-FB3F-4FA6-AD22-2FF0620FB07A)


By Star Parker - Scripps Howard News Service

President Bush's Social Security initiative has gotten off to a shaky start. However, polls indicate that voters are warming up to the idea of personal retirement accounts. It's time for the Bush administration to start making crystal clear the core principles that distinguish its approach on Social Security reform from that of Democrats.

Whereas Bush is selling his reform under the theme of an "ownership society," I would call the Democratic alternative the "plantation society." The "plantation society" is characterized by a wealthy class of owners who want to limit the choices, opportunities and freedom of working-class Americans.

According to public record, one of every three members of the Senate and one out of every four members of the House are millionaires. Despite popular stereotypes of Republicans as the party of the rich and Democrats as the party of the working class, the wealthiest member of the Senate (John Kerry of Massachusetts) and the wealthiest member of the House (Jane Harman of California) are both Democrats. Of the top six wealthiest senators, five are Democrats.

The ownership society has certainly found its way into Congress. But the wealthy Democratic owner class shows little interest in spreading the wealth and opportunity around.

House Democratic leader Nancy Pelosi of California, worth $16.3 million, is an appropriate spokesperson for the plantation caucus. This past week she stood at a press conference with other Democratic leaders stating uncompromising opposition to personal retirement accounts. The Democrats' message: no negotiation on Social Security until "privatization is off the table."

Certainly, Pelosi seems quite comfortable in her ability to manage her own millions. However, the thought of working Americans retaining a few thousand dollars each year of their own earnings to invest in a personal retirement account is so outrageous to her she won't even discuss it. The argument that a private account, ultra-conservatively managed, could at least double the retirement income produced by the current Social Security system doesn't seem to interest Pelosi. Nor does the idea that this would be privately accumulated and owned wealth.

When America's political class debated emancipating slaves, an issue that dampened enthusiasm for the idea was the thought that these slaves could simply walk off the plantation and integrate into the nation and live as free people.

The owner/masters of today's Democratic plantation reject all attempts to roll back government and give working Americans more choice and freedom. The response is the same whether it's personal retirement accounts or choosing where to send your kid to school. Anything reducing government control gets rejected.

Ironically, most personal-retirement-account proposals simply make this option available. But even allowing the option gives too much freedom to working Americans for the Democrats. Apparently, we're all so dumb that not only can't we manage our own money, but we shouldn't even be given a voluntary option to do it.

My elderly mom serves coffee in a local convenience store to earn a few dollars to supplement the pittance she gets from Social Security and the few extra hundred dollars per month she started getting after my dad passed away. He worked all his life. If he could have put all the money he paid in Social Security taxes into a retirement investment account over all those same years, my mom would be in a different situation today.

However, Pelosi wouldn't have wanted my dad to have the option to keep and invest his own money. I'm sure she would have thought that he wasn't as smart and clever as she is and shouldn't be allowed to manage his own money.

The black poverty rate today is double the national average. Black-household wealth is a fourth of the national average. Blacks suffer double jeopardy as a result of the work over the last half-century of welfare-state liberals like Pelosi.

First, Social Security payroll taxes take away the few extra dollars that low-income workers could have otherwise retained to build wealth.

Second, and perhaps even worse, welfare-state liberals have educated a whole generation of blacks that they can't take care of themselves. Skills in areas such as money management may be in deficit today. But they are in deficit because they weren't learned, and they weren't learned because of hanging on the government plantation. When do we let these folks off this plantation so they can finally start learning the essential skills for improving their lives?

Social Security reform, with a crucial central component of personal retirement accounts, is being threatened by elitist Democratic liberals. They preside over a government plantation over which they do not want to relinquish control. It's time to let the slaves free. Transforming taxes into ownership is an important way to do it.


(Star Parker is president of CURE, Coalition on Urban Renewal and Education (www.urbancure.org) and author of the recently published book "Uncle Sam's Plantation.")

[JohnnyMarzetti]

Just an opinion. There are also some "elitist" republicans opposed to your beloved Dubya's plans.

[Nbadan]

Whereas Bush is selling his reform under the theme of an "ownership society," I would call the Democratic alternative the "plantation society." The "plantation society" is characterized by a wealthy class of owners who want to limit the choices, opportunities and freedom of working-class Americans.

:rolleyes

Same old Republican rhetoric, but with a twist. Like the Nazis did in Germany in the 30-40's, the Republican strategy is clearly to try and turn the hard-working-middle-class against 'liberal' intellectuals, and those they consider elitists. They think most people are too busy and too dumb to care.

[exstatic]

Just an opinion. There are also some "elitist" republicans opposed to your beloved Dubya's plans.
I'm glad someone posted this. His own party isn't even sold on this.

[desflood]

:rolleyes

Same old Republican rhetoric, but with a twist. Like the Nazis did in Germany in the 30-40's, the Republican strategy is clearly to try and turn the hard-working-middle-class against 'liberal' intellectuals, and those they consider elitists. They think most people are too busy and too dumb to care.
Same old Democrats, comparing Republicans to Nazis.

[Nbadan]

Same old Democrats, comparing Republicans to Nazis.

It's certainly a stretch, for now, but not much. There are Germanesque symbols of Facism in our everday lives that are sometimes harder to see because we all live such busy lives, from the apathy for your government, or the behavior of its leaders, to a easily manipulated Press, to the Patriot act, to humiliation of prisoners, to torture, to murder, to ragging Nationalism, to perpetual war, to a leader annoited by, and with a direct-line to God. This whole scenario we are seeing has been played before much better, and for much worse.

[ChumpDumper]

"Reform" is being quelled by the indifferent majority. Welcome to lame duck status.

[Ocotillo]

Social Security is a government program designed to reduce poverty among the elderly. It should not be counted on as the sole means of support during retirement but is a safety net in the event of bad planning or unfortunate events. It is a program that has worked well which most Republicans are loathed to admit. Since it's inception, conservatives have longed to destroy it.

Bush said after the election he had amassed political capital and he intended to spend it. That is what he is doing here. His goal is to end Social Security, period, finito, end of discussion. He realizes even with his so called political capital, he cannot end benefits to current or near retirees. So he introduces the red herring of private accounts (which he calls personal accounts because it polls better). Initially, his contention was Social Security is in crisis.

Well despite the so called crisis, the president intorduces and idea that does nothing to increase the solvency of Social Security but costs trillions of dollars to implement. What about the crisis? There is no crisis but by diverting money from the current system to private accounts, there will be and hard decisions will have to be made. Either payroll taxes would have to be raised or benefits decreased. Guess which alternative the president wants.

You want a personal (private) account? Their already is such a beast. It's called an IRA. You even get to pick what you invest in and you get to keep it as well.

I understand conservative notion that Social Security is a government program and why they philosophically oppose it. I also say Bush is intellectually dishonest by not openly stating his true purpose and goal.

[The Ressurrected One]

Has anyone looked at Galveston County, Texas where the county government opted out of Social Security for private retirement accounts...before the boom and bust and boom and near-bust of 80's and 90's only to see their PRIVATE retirement accounts be worth bazillions more than would their Social Security "accounts?"

What's up with that?

[Nbadan]

FACT ONE: Year to year change in the Trustee's report tend to be small unless the Trustee's make large assumption changes. The 2004's Trust funds exhausted in 2043 date continued the improvement in that funds exhausted date (from 1994 to 2004, the exhaustion date rose from 2029 to 2042).

FACT TWO: After 2042 when the Trust Funds may be exhausted, Social Security will still receive taxes that will allow it to pay for benefits - benefits still greater than what people could expect from a privatized system along the lines laid out under the second option of President Bush's Commission to Strengthen Social Security (CSSS) in 2001, according to estimates by the nonpartisan Congressional Budget Office American Progress (http://www.americanprogress.org/site/pp.asp?c=biJRJ8OVF...)

FACT THREE: The Bush Trustees use pessimistic Economic Predictions so as to be conservative. Historically, economic growth has averaged 3.4 percent annually after accounting for inflation, according to the Department of Commerce's Bureau of Economic Analysis, but the Trustee intermediate projection assumed an inflation adjusted growth rate of 1.8 percent in their 2004 report. A decrease in growth of 47% as assumed by the Trustees means significantly lower stock market gains since profits grow a lot slower when the economy grows slower. Indeed the Wall Street Journal survey of prominent economists had the majority puting stock market growth for the future between 4.0 percent and 4.6 percent, instead of the historical average of 6.5 percent. Private accounts, already projected to not be able to replace the planned Bush cuts thought to be planned for the guaranteed benefit Soc Sec program, would need to be re-projected and would project even smaller retirement payments that the small payments now being discussed by Bush.

Washington Times (http://ap.washingtontimes.com/dynamic/stories/S/SOCIAL_...)

[Clandestino]

i would rather ax social security and get to invest all my money that i earned.. if you choose not to invest then you can eat cat food when you are 65

[Nbadan]

On Yesterday's Trustee's Report cooked SS numbers...


The Social Security trustees issued their annual report yesterday and said that by one measure, the shortfall in Social Security's finances jumped from $10.4 trillion last year to about $11 trillion this year. Eleven trillion dollars! The trustees, in service to President Bush's alarmist warnings about the need to do something drastic about Social Security, are dishing up some misleading numbers.

It's bad enough that the trustees began some of their calculations with that $10.4 trillion figure. It's arrived at by projecting the system's shortfall over infinity, rather than the usual 75-year time frame - as if the system's finances 10,000 years from now are a legitimate policy concern. Moreover, no less an authority than the American Academy of Actuaries is already on record debunking infinite projections as conveying "little if any useful information about the program's long-range finances" and "likely to mislead anyone lacking technical expertise ... into believing that the program is in far worse financial condition than is actually indicated."

Compounding the subterfuge is that the difference between this year's $11 trillion eyepopper and last year's number - $600 billion - is being used as evidence of a scary deterioration in Social Security's finances. That's just wrong. The two monster numbers are actually the same quantity - different ways of expressing an unchanging level of debt at two different points in time. If you owe someone $1,000 in 10 years, for instance, you could retire the debt now with $500, or next year with $530. Your level of debt doesn't change, just the time point.

Some people who interpret the numbers as a deterioration appear to be confused. But others, like President Bush, are being deliberately alarmist. Mr. Bush's persistent misstatements on Social Security leave little doubt that he wants Americans to believe that the system is irretrievably broken so that they will buy into his unnecessary privatization plan.

Fortunately, the unpoliticized numbers in yesterday's report are not overly dire. Using a 75-year time horizon, the trustees project that the system will be able to pay full benefits until 2041, at which time it will be able to pay 74 percent of the promised benefits, falling to 68 percent by 2079. That works out to a gap of $4 trillion, which could be bridged with modest tax increases and benefit cuts, phased in over the next few decades. If people try to tell you different, they need to be set straight.

Ny Times (http://www.nytimes.com/2005/03/24/opinion/24thu3.html?oref=login)

Those IOU's in the SS trust fund aren't worthless paper, they are Government bonds and securities. In effect, promises by our government to repay money they borrowed, and if they aren't worth a damn to us, then why should foreign governments keep financing our debts by purchasing them?

[Clandestino]

Social Security Said to Go Broke in 2041

Wed Mar 23, 7:19 PM ET White House - AP


By GLEN JOHNSON, Associated Press Writer

WASHINGTON - Social Security (news - web sites) will begin paying out more in benefits than it receives in taxes in 2017, twelve years from now and a year earlier than previously estimated, trustees said Wednesday in a forecast adding fuel to the debate over changes President Bush (news - web sites) wants.


The trustees estimated that the program, which is about to be inundated with baby boom retirees, would go broke in 2041, also a year earlier than in their previous annual report. After then, benefits would have to be cut by more than 25 percent if payroll taxes aren't increased.


The Bush administration said both findings underscored the urgency of its effort to overhaul Social Security this year, in part by creating retirement investment accounts for younger workers. Democrats said the trustees' report undercut the president's efforts to portray the program as in immediate crisis.


That label would appear to apply to Medicare, the health care program for the elderly and disabled. The trustees, who also oversee that Great Society program, noted that Medicare began paying out more in benefits than it received in taxes as of last year. They also predicted it would go broke in 2020, one year later than they estimated in 2004, but more than two decades before Social Security.


"The numbers leave nothing to doubt about the financial condition of the Social Security system," Treasury Secretary John Snow, chairman of the six-member trustees' board, said during a news conference. "The report underscores the fact that we need to do something."


Mike Leavitt, the new Health and Human Services (news - web sites) secretary and another trustee, said that Medicare and Medicaid — the health insurance program for the elderly at the state level — face daunting financial problems.


The trustees estimated that the premiums Medicare beneficiaries pay for doctor visits will increase about 12 percent next year — from $78.20 a month now to $87.70 in 2005. This year's premiums are 17 percent above what they were in 2004.


Leavitt said the administration had begun to address Medicare in 2003 with new performance standards for doctors, as well as programs that encourage better health through things as simple as an annual physical.


Senator Harry Reid of Nevada, the top Democrat in the Senate, disagreed with Snow, declaring, "Today's report confirms that the so-called Social Security crisis exists in only one place: the minds of Republicans."


Reid also argued that enacting the key feature of the president's proposal — allowing younger workers to invest up to 4 percent of their income subject to Social Security taxes — would make the fund insolvent in 2030, some 11 years earlier than the trustees projected.


Snow branded Reid's former statement as "counterfactual," noting that the first of the 78 million baby boomers will begin to retire in 2008, accelerating benefit payments while reducing the number of workers paying into the system.


White House spokesman Trent Duffy also brushed off the 2030 estimate, saying, "President Bush wants to save Social Security permanently so that date never comes."


The trustees said that Social Security's unfunded obligations total $4 trillion over the next 75 years, an increase from last year's projection of $3.7 trillion.


Bush has said he will not raise the current 12.4 percent payroll tax to deal with the funding problem, but he has said he would consider raising the $90,000 cap on income subject to the payroll tax.


In the report, the trustees said of proposed changes, "The sooner adjustments are made, the smaller and less abrupt they will have to be."


The report said in 2041, the new date for Social Security's insolvency, payroll taxes will be generating enough income to cover 74 percent of benefit payments. That represents a slight increase from last year, when the trustees estimated that 73 percent of benefits would be covered in the year that the trust fund went broke.


For Medicare, the trustees estimated that taxes would be sufficient to cover 79 percent of the program's cost in 2020, when the Medicare trust fund is exhausted. Last year, when the insolvency date was projected to be 2019, tax income was estimated to be sufficient to pay 81 percent of the program's costs.





Social Security provides retirement, survivors and disability income for 47.6 million Americans, while Medicare provides health care for 41.7 million seniors and disabled people.

Besides Snow and Leavitt, the board of trustees includes Labor Secretary Elaine Chao, Social Security Commissioner Jo Anne Barnhart, and two public trustees, Thomas Saving of Texas and John L. Palmer of New York.

[IcemanCometh]

http://www.mnftiu.cc/mnftiu.cc/images/elitist_shirt_preview.gif

[Nbadan]

Dick Cheney has taken charge of the Social Security Demolition Derby while Georgie (hides from the fundies) relaxes in Crawford. Regular readers know that I've been poring over the White House transcripts of Chimpy's Social Security road show for the past couple of months.

Funny thing, though - Cheney did two Baboon-a-palooza events yesterday, one in Battle Creek, Michigan, and a second in Pittsburgh, but the White House as of 8AM CST has not posted transcripts from either event.

So I turned to local press coverage of the two events and soon found out why the White House is holding onto those transcripts. Big Time Dick is getting blasted by both the local press and his hand-picked audiences.

Unlike Dear Leader, when Cheney does a Social Security "town hall" meeting he allows audience members to ask him questions instead of placing "regular folks" on stage with him for well-rehearsed exchanges on the evils of Social Security. Turns out that was a huge mistake on Dick's part.

Here James Prichard, writing for the AP in an article picked up by the Lansing State Journal, notes that even the host for Cheney's Michigan "conversation", Rep. Joe Schwarz (R-Battle Creek), is not buying privatization.


Cheney was joined on stage by U.S. Rep. Joe Schwarz, R-Battle Creek, who said he and the White House have "some disagreements on how we get there" when it comes to Social Security reform.

Schwarz said Wednesday he was not convinced that allowing personal retirement accounts will help solve the problem.

The Battle Creek audience posed questions that would have sent Bush muttering about "hard work".

During a question-and-answer session with audience members, Cheney was asked what he thought about taking the entire Social Security trust fund and allowing the federal government to invest it in the stock market, in an attempt to improve its current annual rate of return of about 1.3 percent. Cheney said he would oppose such a plan.

"There's a lot of resistance to the notion that the federal government own that big a piece of the stock market," he said.

Conditions did not improve when Cheney reached Pittsburgh. James O'Toole of the Pittsburgh Post-Gazette focused on the bubble.


By design, most of the audience, and most of the questions to Cheney, were friendly. Bob Glancey, chairman of the Allegheny County Republican Party, asked him why the proportion of contributions eligible for personal accounts wasn't even larger. Mike Rubino, 19, head of the Seton Hill University Young Republicans, asked another approving question on the virtues of private accounts.

But despite the Pennsylvania GOP's best efforts, a few actual citizens slipped through to question the Veep.


Cheney did face some skeptical questioning, however, as other members of the audience challenged him on the likely returns of the investment accounts, and on the fact, which Cheney acknowledged, that establishing personal accounts would not shore up Social Security's long-term financial outlook.

[snip]

Burnishing the merits of personal retirement accounts, Cheney pointed to the experience of federal workers who have the option of placing part of their retirement savings in somewhat similar accounts. But that argument fell flat with one of his questioners.

Kim Miller, of Mt. Lebanon, said that she had been a federal employee and invested in the Thrift Savings Plan, "and I didn't do well at all."

Miller was eligible for the plan as a member of the staff of a former Democratic congressman. She is now an employee of the United Steelworkers union, which strongly opposes the president's private accounts proposal.

[snip]

Another questioner, Barbara Bush [!!!], an AARP volunteer from the North Hills, pressed Cheney on the fund's solvency, arguing that the creation of private accounts would do nothing to solve that basic issue.

Cheney acknowledged that "other things" still would have to be done to address projected shortfalls, but maintained that private accounts would give individuals the opportunity to make up for whatever belt-tightening the overall program would experience.

"I thought he skirted the question," Bush said later. "With [private accounts], you would just weaken a system that is already weak."

O'Toole then set his rhetorical sights on Cheney's host, Rep. Melissa Hart (R-Entertainment Tonight)

Not surprisingly, Rep. Melissa Hart, R-Bradford Woods, the vice president's co-host for the gathering, offered rave reviews both for Cheney's performance and for the merits of personal savings accounts.

Despite recent poll results suggesting that a majority of the public disagrees with the president's proposal, she predicted that Congress would enact some version of it this year. Hart said sessions like yesterday's would help that happen. She noted poll numbers that showed that, whatever the attitudes on specific remedies, the proportion of the public who viewed Social Security as having serious financial problems had climbed sharply over the last year.

Is it any wonder the White House won't release these transcripts?

First Draft.com (http://first-draft.com/modules.php?name=News&file=article&sid=2564&mode=thread&order=0&thold=0)