Thursday, November 11, 2004

Social Security

CNN has a story about how Bush is moving forward with "his" plan (I doubt he's ever had a real plan in his life, other than "We're goin' drinkin'!") for Social Security privitization. There are a few points that make me furious (surprise surprise):

For future retirees, base benefits would be cut by tying them to inflation instead of wage growth, with stock market gains assumed to make up any shortfall. The concept gained support in the stock market boom of the late 1990s.

Here we see one of the major problems with most of this administration's plans. They are always assuming. They assume that growth will continue at the current rate, so we can have huge tax cuts for the rich; they assume that Iraqis will welcome us with open arms, so they don't have to plan for the peace; and now they assume that the stock market will just go up and up and up, increasing the value of our privitized accounts and making up for all the new cuts in Social Security benefits. My advice to all you seniors out there, better start stocking up on canned goods and dog food now, while the stock market is up, because if we have another recession or terrorist attack, the Bush administration will have once again made an ASS out of U and ME.

So back to the article. How are they going to pay for all this?

...the yearly price tag of $80 billion to $100 billion could be funded by closing tax loopholes, cutting pork barrel spending, borrowing money or temporarily raising the payroll tax cap on earnings.

Well, we know the first two things sure as hell aren't going to happen, which leaves us with the last two. Borrowing more money, that sounds like a great idea. We've already got the biggest deficit in US history, why not pile on a few billion more dollars? Of course, the alternative is they could raise the payroll tax cap. This might not be so bad, because it would only affect people making over $87,900 a year (the current cap). Will Bush actually raise taxes on higher income earners? I'll answer that when I stop laughing.

Here's the most aggrivating part:

But supporters of accounts say Democrats can no longer criticize partial privatization without offering their own plan to deal with Social Security's $3.7 trillion, 75-year shortfall.

Um, I seem to recall Al Gore using the phrase "lock box" about 3.7 trillion times during his campaign. And who was it, pray tell, who spent all that surplus money that was supposed to shore up Social Security on a tax cut for his friends?

And you know what really sucks? We've been paying higher payroll taxes for the last 20 years so the government could build up a surplus to shore up Social Security against the apparently apocalyptic event know as The Retiring of the Baby Boomers. This was advocated at the time by Fed Chairman Alan Greenspan. In 2001 Greenspan advocated returning that surplus to the people (i.e. the rich people) through Bush's tax cuts. Then, in 2004, he said that because that surplus was gone, we're going to have to cut Social Security benefits. So, follow the bouncing ball here:

Republicans raise taxes in the 80's on lower- and middle-class workers though higher payroll taxes (remember, you are only taxed on the first $87,000 bucks of your income for payroll taxes, everything above is exempt), then in 2001-2004 they give that money away disproportionately to the rich, THEN they start advocating cutting Social Security benefits. We get less for our forced investment in Social Security, while the rich get fatter off our money.

To learn more about how we're getting screwed, consult your local library. Or just be lazy and read some of these articles:
The Unlocked Box
Maestro of Chutzpah by Paul Krugman
Greenspan Warns Against Deficits
Is Social Security Really Even in Trouble?

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