Sunday, November 07, 2004
THE SLOW DEMISE OF SOCIAL SECURITY
One outcome of the election is certain. President Bush and his allies will take the first step toward dismantling the Social Security System that we have enjoyed since the days of FDR. Ultimately the present scheme, in which the federal government provides a guaranteed monthly payment, based on your employment history, will be replaced with individual savings accounts. The change is to be gradual, not abrupt, so as not to stir up too much opposition. At first a small fraction of the social security tax, or payroll tax that a worker pays will be invested in Wall Street securities: stocks, bonds, mutual funds, etc. As time goes on, subsequent administrations will change the fraction until the entire amount is so invested.
Most Democrats and even some Republicans are opposed to the plan to "privatize" Social Security. However, they have so far not mounted a convincing argument against Mr. Bush's plan. They argue only that the change will be very expensive, since persons now receiving Social Security benefits must still receive them and part of the revenue stream that pays the benefits will be diverted to the individual accounts. That argument is not persuasive. It certainly doesn't persuade me, and I am a strong advocate of keeping Social Security as a guaranteed pension, guaranteed even if not paid for by the federal government.
Those of us who favor keeping Social Security as a federally guaranteed pension must put the question to the American People in simple, direct terms: do we as a people wish to keep a system that guarantees a decent living for all people living in retirement?
There are two points of view on this question. Conservatives argue against the very concept of a government guarantee of a decent retirement income. Instead, they argue in favor of a society in which every person owns something, particularly shares of stock or bonds issued by for-profit corporations. If everybody were to own enough, there would be no need for welfare, subsidized health insurance, old age pensions, and other "entitlements."
We liberals argue that one must be realistic and realize that not every worker will be able to save enough to achieve a decent standard of living when he or she retires. Many individuals, particularly women with children and no husbands, barely get by now on minimum-wage jobs. Whether they invest extra cash in a savings account at a bank or in a stock portfolio with a stockbroker, they simply don't have the extra cash. Every worker, during his or her lifetime of work, supports the economy and provides a useful service. We think it is morally right and proper that such a worker be given a retirement life free of worry and free of abject poverty. We believe that if the American public decides that Social Security should be kept as a guaranteed pension, or entitlement, then the problem of how to pay for it becomes a mere matter of details. For example, having a strong military institution to protect us from foreign invaders is like an entitlement. We are all entitled to the protection that the military provides. We do not fret over the details of how to pay for it.
However strongly I feel about Social Security, the recent election indicates that I may be in the minority. Mr. Bush has stated that one of his first tasks will be to do something about Social Security. He will start the slow process of privatization, the slow demist of Social Security. We are headed back, no matter how much I may kick and scream, to the days of Calvin Coolidge, who advised Americans to "work hard and save their money."
Most Democrats and even some Republicans are opposed to the plan to "privatize" Social Security. However, they have so far not mounted a convincing argument against Mr. Bush's plan. They argue only that the change will be very expensive, since persons now receiving Social Security benefits must still receive them and part of the revenue stream that pays the benefits will be diverted to the individual accounts. That argument is not persuasive. It certainly doesn't persuade me, and I am a strong advocate of keeping Social Security as a guaranteed pension, guaranteed even if not paid for by the federal government.
Those of us who favor keeping Social Security as a federally guaranteed pension must put the question to the American People in simple, direct terms: do we as a people wish to keep a system that guarantees a decent living for all people living in retirement?
There are two points of view on this question. Conservatives argue against the very concept of a government guarantee of a decent retirement income. Instead, they argue in favor of a society in which every person owns something, particularly shares of stock or bonds issued by for-profit corporations. If everybody were to own enough, there would be no need for welfare, subsidized health insurance, old age pensions, and other "entitlements."
We liberals argue that one must be realistic and realize that not every worker will be able to save enough to achieve a decent standard of living when he or she retires. Many individuals, particularly women with children and no husbands, barely get by now on minimum-wage jobs. Whether they invest extra cash in a savings account at a bank or in a stock portfolio with a stockbroker, they simply don't have the extra cash. Every worker, during his or her lifetime of work, supports the economy and provides a useful service. We think it is morally right and proper that such a worker be given a retirement life free of worry and free of abject poverty. We believe that if the American public decides that Social Security should be kept as a guaranteed pension, or entitlement, then the problem of how to pay for it becomes a mere matter of details. For example, having a strong military institution to protect us from foreign invaders is like an entitlement. We are all entitled to the protection that the military provides. We do not fret over the details of how to pay for it.
However strongly I feel about Social Security, the recent election indicates that I may be in the minority. Mr. Bush has stated that one of his first tasks will be to do something about Social Security. He will start the slow process of privatization, the slow demist of Social Security. We are headed back, no matter how much I may kick and scream, to the days of Calvin Coolidge, who advised Americans to "work hard and save their money."
