Thursday, May 05, 2005
About Indexing Social Security
Indexing is the name of some scheme for arranging Social Security payments so that if you are poor (by some definition of income) the benefits will increase in the same way as wages increase, while if you are not poor (middle class or rich) the benefits will increase less rapidly, according to the way prices increase. One long-term result will be that the middle class and rich will be less apt to support the program than the poor, since they will not get as much out of it. Divide and govern. The Democrats seem inclined to go along with this "compromise."
Conservative Republicans have hated the Social Security program from the beginning. The conservative belief is that all individuals should take care of themselves and not depend on government. It is not, according to conservatives, a proper function of government to take care of people. Government should take care of property, provide safe money, keep the communists from invading and taking over the country, and leave business alone. Now they have a chance to get rid of Social Security. A frontal attack can't succeed because the program has very wide public support. However, if that support can be split, if an important segment of the public can be persuaded that the program isn't worth keeping, then it will be possible to abolish it.
An attempt at splitting the support was made a few months ago by assuring that anyone born before 1950 would enjoy all the expected benefits on retirement. Younger workers, many of whom had expressed the belief that "social security would't be there for them when they retire," were tempted with the vision of personal savings accounts and a forever rising stock market. That ploy hasn't worked.
We shall see whether the indexing ploy works. It won't be necessary to convince the middle class workers that social security with indexing will make the program less desirable. That change of mind can come later, perhaps twenty years from now. Right now indexing seems to be a "humane" way of "fixing" a system that is predicted to go broke in forty years. Of course that prediction is rather dubious and depends on the choice and manipulation of statistical data.
My thought about this prediction? A saying comes to mind: Figures don't lie, but liars use figures. Another saying: There are three kinds of lies: lies, damned lies, and statistics.
Conservative Republicans have hated the Social Security program from the beginning. The conservative belief is that all individuals should take care of themselves and not depend on government. It is not, according to conservatives, a proper function of government to take care of people. Government should take care of property, provide safe money, keep the communists from invading and taking over the country, and leave business alone. Now they have a chance to get rid of Social Security. A frontal attack can't succeed because the program has very wide public support. However, if that support can be split, if an important segment of the public can be persuaded that the program isn't worth keeping, then it will be possible to abolish it.
An attempt at splitting the support was made a few months ago by assuring that anyone born before 1950 would enjoy all the expected benefits on retirement. Younger workers, many of whom had expressed the belief that "social security would't be there for them when they retire," were tempted with the vision of personal savings accounts and a forever rising stock market. That ploy hasn't worked.
We shall see whether the indexing ploy works. It won't be necessary to convince the middle class workers that social security with indexing will make the program less desirable. That change of mind can come later, perhaps twenty years from now. Right now indexing seems to be a "humane" way of "fixing" a system that is predicted to go broke in forty years. Of course that prediction is rather dubious and depends on the choice and manipulation of statistical data.
My thought about this prediction? A saying comes to mind: Figures don't lie, but liars use figures. Another saying: There are three kinds of lies: lies, damned lies, and statistics.
