Saturday, June 25, 2005
Fixing Facts to Fit the Policy
We know that Bush and Company adjusted the intelligence estimates (fixed the facts) to justify the War against Iraq. They’re also fixing the facts to justify the goal of eliminating Social Security.
The conservatives’ goal is to eliminate Social Security as a government guaranteed benefit. Their belief is that people should take care of themselves and not depend on government to support them in retirement.
Facts: The payroll tax provides more income than what is needed to pay current benefits. The extra money is invested in government bonds. The Social Security Administration holds the bonds. The Treasury puts the money into the general fund. Those bonds are an obligation for the government, at some time in the future, to buy them back. At some date, probably in the year 2017, the payroll tax will just pay benefits. After that the Social Security Administration will start cashing in the bonds to provide the extra money. Eventually, the bonds will be all gone, probably some time around 2040.
Fixing the Facts: The year 2040 is too far in the future to qualify as a source of a crisis that needs to be dealt with during Bush’s term of office. Therefore, the Social Security System must be made to run out of money sooner, much sooner.
Action to Fix the Facts: One plan, newly proposed, is to use the surplus (i.e., the bonds in the Social Security Trust Fund) to pay for individual retirement accounts. In that way, the system will run out of sufficient funds to pay all benefits in 2017, not 2040. That’s soon enough to create a crisis that must be dealt with now.
Dealing with the Crisis: Several things may happen. The happiest outcome for workers who depend on Social Security is that the present scheme of guaranteed benefits continues in effect with no decrease in benefits. In addition, workers are given individual retirement accounts to use to supplement the guaranteed benefits. That will not happen as long as the present Conservative Republican coalition controls both Congress and the White House. What is more likely is that the guaranteed benefit part of Social Security will be allowed to expire and be replaced by savings accounts. This result will please the conservative ideologues who believe that each person should take responsibility for his or her own retirement and not depend on government.
The conservatives’ goal is to eliminate Social Security as a government guaranteed benefit. Their belief is that people should take care of themselves and not depend on government to support them in retirement.
Facts: The payroll tax provides more income than what is needed to pay current benefits. The extra money is invested in government bonds. The Social Security Administration holds the bonds. The Treasury puts the money into the general fund. Those bonds are an obligation for the government, at some time in the future, to buy them back. At some date, probably in the year 2017, the payroll tax will just pay benefits. After that the Social Security Administration will start cashing in the bonds to provide the extra money. Eventually, the bonds will be all gone, probably some time around 2040.
Fixing the Facts: The year 2040 is too far in the future to qualify as a source of a crisis that needs to be dealt with during Bush’s term of office. Therefore, the Social Security System must be made to run out of money sooner, much sooner.
Action to Fix the Facts: One plan, newly proposed, is to use the surplus (i.e., the bonds in the Social Security Trust Fund) to pay for individual retirement accounts. In that way, the system will run out of sufficient funds to pay all benefits in 2017, not 2040. That’s soon enough to create a crisis that must be dealt with now.
Dealing with the Crisis: Several things may happen. The happiest outcome for workers who depend on Social Security is that the present scheme of guaranteed benefits continues in effect with no decrease in benefits. In addition, workers are given individual retirement accounts to use to supplement the guaranteed benefits. That will not happen as long as the present Conservative Republican coalition controls both Congress and the White House. What is more likely is that the guaranteed benefit part of Social Security will be allowed to expire and be replaced by savings accounts. This result will please the conservative ideologues who believe that each person should take responsibility for his or her own retirement and not depend on government.
