The usual, tired old carnards. Not even worthy of debate.
Posted on 05/05/2005 8:32:08 AM PDT by MurryMom
AUSTIN, Texas -- Attention, all campers! "Progressive indexing" is just another word for "cutting Social Security benefits." Do not be fooled by this idiot locution. Just as sure as "extraordinary rendition" now means "shipping the guy to another country so he can be tortured," progressive indexing means cutting benefits. Got it? In another interesting development from President Bush's news conference, if you make more than $20,000 a year, you are wealthy. That's what the president said -- "wealthy."
Would you hire this man as an investment consultant? Bush said, "I know some Americans have reservations about investing in the stock market, so I propose that one investment option will consist entirely of treasury bonds, which are backed by the full faith and credit of the United States government." These are exactly the same treasury bonds that currently guarantee Social Security and have been described by Bush, including in the very same press conference, as a cabinet full of "worthless IOUs."
He continued, "Options like this will make voluntary personal retirement accounts a safer investment that will allow an American to build a nest egg that he or she can pass on to whomever he or she chooses." Nope, under that option, what you get is not a nest egg, but a rotten egg.
Brad DeLong, the blogging economics professor who specializes in this subject, ran the numbers. "The safest long-term investment the U.S. Treasury offers is the 20-year, inflation-protected TIP. ... What Bush is not telling you is that, under the Bush plan, if you divert $1,000 from your Social Security to private accounts, that amount is clawed back -- charged to an account associated with your normal Social Security benefit, that amount is then compounded at 3 percent per year plus the rate of inflation, and then after you retire, deducted over time from you normal Social Security benefit.
"If you are 45 and if Bush's plan were available today ... follow George W. Bush's advice, divert $1,000 into your private account, invest it in TIPS, and at the 1.85 percent per year interest rate you will indeed be able to collect an extra amount worth $10.11 a month in today's dollars when you retire at 65. ...
"But the clawback would reduce your normal Social Security benefit by $14.16 a month. You're $4.05 a month behind."
That's why privatizers never mention the clawback.
Basically, you have to beat 3 percent plus inflation to come out ahead, and the only way to do that is to gamble in the stock market.
Further technical analysis by Jason Furman shows how really badly the plan screws the middle class and that it would not close 70 percent of the shortfall problem, as Bush claimed, but 57 percent, including cuts for the disabled. Bottom line, it's a bad deal.
By the way, to the bird-brain on television who said it's only 4 percent of your Social Security and who wouldn't take some risks with a mere 4 percent? -- jeez. The 4 percent they are talking about is 4 percent of the 12 percent in total Social Security tax. Four is one-third of 12, and that comes to 33 percent. It's not that hard, honey.
Bush used another common disinformation claim out of Washington -- we are not cutting the benefits, we are merely slowing the rate of growth in the benefits. This is a perennial form of government lying.
"Of course we are not cutting Head Start. We are spending more money on Head Start than ever -- look, here's this figure in our budget, it is more than it was last year, and so that is an increase."
Except, since there are ever more kids who qualify for Head Start (and even at the lowest level, the program has never been fully funded), when the increase in funding is way too small to cover the increase in the number of most needy kids, what you have effectively done is decrease the spending per child in the program, and that is, in fact, cutting the program. It will not work as well. That this old dog still hunts is a shame on the arithmetic teachers of America.
Look, Social Security has a long-term financing problem that is not particularly dire and in fact not nearly as troubling as the Medicare shortfall. The Social Security shortfall can be solved by any one of a number of combinations of benefit cuts and tax increases. One thing you could do is let the Bush tax cuts expire at the end of 10 years, as they were originally supposed to do, or you could take the cap off Social Security taxes, which is now set at $90,000. That means at present any income you make over $90 K is not subject to Social Security taxes, one of the most flatly regressive features in the tax code. Removing the cap would solve the projected Social Security deficit, despite right-wing claims to the contrary.
And all I can say for Bush's energy plan is, if he thinks Americans want to give even more huge tax breaks to the oil companies when they are already making obscene profits, he's been talking to people on the wrong planet.
That fat, dumb RAT broad doesn't know what in the hell she is talking about. The bonds that Bush was talking about ARE NOT EXACTLY LIKE THE ONES THAT CURRENTLY "GUARANTEE" SOCIAL SECURITY. The latter are "special bonds" that can't be sold on the open market.
The bonds that Bush was talking about are exactly like the ones that you and I can buy from the Treasury. When we sell them back to the Treasury, they give us the money and sell the bond to someone else.
The bonds in the Social Security "Trust Fund" are worthless pieces of paper.
Are they IOUs or not?
In Britain, the state pension is a pittance - no one with any sense whatsoever takes it seriously. The system is largely privatised - I have a private pension plan and can build up a variety of investments. The Democrats don't want you to go down that road because they lose a class of people dependent on the government, their main constituency.
Regards, Ivan
Whenever I see an article written by Molly Ivins, I recall what my ex-girlfriend from Texas told me about her (she worked in the same office as Molly) - let's just say she said Molly was less than adept at remembering to bathe. The putrifying scent of socialism is a literal truth in her case.
Regards, Ivan
I work for the Federal Government, and we have our own (optional) retirement plan called the Thrift Savings Plan. It's an absolute home run - everybody loves it. Bush's plan is essentially opening the TSP (which is basically a government-run 401(k)) to the public.
"Comic lows" is about as apt a description as I could imagine for anything ever written by Molly Ivins. Two things you can always count on in an Ivins column: (1) The attempts at humor will be distinctly not funny; (2) The bashing of her target-du-jour (Bush, Christians, Republicans in general, or "Big Bidnis") will consist of outright lies, half-truths, or distortions completely devoid of any context.
Ms Ivins is simply repeating Democratic talking points. The money in SS invested in IOUs belong to the govt not individuals. The incentive facing individuals in such a circumstance so as to change her portfolio choice has completely different economic implications than the govt simply shifting liability to the future. For one, the investor will demand her money back at 65, whereas govt will simply borrow more and keep shifting the burden. I thought Democrats were the smart ones.
I wondered why my newspaper smells funny the day her column appears. Thanks for clearing up the mystery!
I did hear of a neighbor whose cat died of constipation when the litter box was lined with Ivins column, using it would have been horribly redundant.
Obscene profits? in 1999, we were losing about one oil company per day because the price of oil was 10$ per barrel and gas was 1.50 per thousand cubic feet. What do people think that oil companies do with the money? They don't distribute to the shareholders in a large way. They take that money and put it in the ground. When I entered the business, there were about 1.1 million employees. Now there are less than 200,000.
I have the perfect solution. KILL SS and stop stealing my freakin $$$ to pay for your old butts !!
One of the things about the Social Security Debate is that Bush was actually doing the right thing by simply announcing that America has a problem with Social Security, and then waiting for a variety of plans to appear to fix that problem.
Instead the Dem's have simply responded "What Problem?" and waited for Bush to produce a plan that they can criticize... and no plan of their own.
They're the party with plenty of criticisms but no suggestions.
Very Sad.
right you are
Read it again. Slowly.
1) Take all federal property that has no military presence on it and sell it. Put it all on ebay. Then let the bidding begin. This would likely clear our books of all debt. 2) Chunk the tax system and implement a 10% national sales tax. 6% for people that own property. 3) Require members of Congress to be home 8 months of the year. Only allow 4 months for the passing of legislation. 4) All legislation passed by Congress will only be effective for a term of 10 years. 5) Have scientists see if they can figure out why Robert Byrd's lips sweat like a fat guys arm pits.
That's why SS is hated by Wall Street. The bankers there are getting fat on 2-3% yearly commissions and fees on our money, so they pay big campaign contributions (bribes) to Bush et al. in order to phase out the present working SS system.
What's sad is that Bush and other Republicans have convinced so many there is a problem when the SSTF is growing at a rate of more than $150B yearly, with no end in sight to the surpluses. The Democrats' plan is to retain the present system without any of the tax increases and benefit reductions inherent in Bush's phase out scheme.
Who is going to produce all the goods and services that all those paper-billions are going to buy?
Tell me where in the Constitution that says the Government has a right to take my money to pay old people???
It's right next to the Abortion Clause of the Bill of Rights.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.