It's time to derail Social Security privatization
In a nutshell:
1) Social Security was never designed to many any retiree rich. It was designed to prevent every retiree from being destutite. For about 70 years, it has worked just fine.
2) Social Security is not broken. The Social Security administration itself estimates that the trust fund has no problems at all before 2042. As Kevin Drum has pointed out, this is a highly conservative estimate, and that over the past decade, the SSA has consistently predicted the 'zero point' to be about 35 years in the future. In fact, since 1994 it's gone from 35 years to 38 years away. Nice!
3) Every "plan" to "fix" Social Security rests on one of two fallacious assumptions. Some plans rest on both of them. These fallacious assumptions are:
a) Assuming that under the current system, worker contributions will grow at a certain rate (say, 2%) but that under a new system, investments would grow at a larger rate (say, 4.6%). Over time, the growth in the value of investments closely matches the growth of the economy as a whole, and many attempts to justify privatization rely on using different numbers for the two cases.
b) Assuming that borrowing money 35 years in the future (when the 'zero point' is reached) is a Very Bad Thing, but that borrowing money now to pay for 'transition costs' in the trillions of dollars is a Perfectly Fine Thing. Wouldn't you rather defer borrowing trillions to a point at least 35 years in the future, especially when that point might shift ever farther into the future, as it has done for the past decade?
Well, enough. Democrats are going to have to be ballsy if they want to prevent the destruction of another sensible American ideal. We need to fight back, and we need to start now -- for the radical right is certainly starting now. Here is a handy primer from Digby about how the Republicans destroyed Clinton's healthcare reform -- when the Democrats controlled the White House, the Senate, and the House of Representatives.
We should all read, learn, plan, and act NOW.
Quote from the Digby piece:
"September 19, 1994 - The New York Times reports remarks -- never subsequently denied -- that Bob Packwood made to his Republican senatorial colleagues during closed-door strategy sessions while he was managing the Republican attack during the summer. "We've killed health care reform," Packwood told his fellow Republican senators. "Now we've got to make sure our fingerprints are not on it." For many this is the "smoking gun": proof of a carefully plotted, and secret, Republican strategy."
1) Social Security was never designed to many any retiree rich. It was designed to prevent every retiree from being destutite. For about 70 years, it has worked just fine.
2) Social Security is not broken. The Social Security administration itself estimates that the trust fund has no problems at all before 2042. As Kevin Drum has pointed out, this is a highly conservative estimate, and that over the past decade, the SSA has consistently predicted the 'zero point' to be about 35 years in the future. In fact, since 1994 it's gone from 35 years to 38 years away. Nice!
3) Every "plan" to "fix" Social Security rests on one of two fallacious assumptions. Some plans rest on both of them. These fallacious assumptions are:
a) Assuming that under the current system, worker contributions will grow at a certain rate (say, 2%) but that under a new system, investments would grow at a larger rate (say, 4.6%). Over time, the growth in the value of investments closely matches the growth of the economy as a whole, and many attempts to justify privatization rely on using different numbers for the two cases.
b) Assuming that borrowing money 35 years in the future (when the 'zero point' is reached) is a Very Bad Thing, but that borrowing money now to pay for 'transition costs' in the trillions of dollars is a Perfectly Fine Thing. Wouldn't you rather defer borrowing trillions to a point at least 35 years in the future, especially when that point might shift ever farther into the future, as it has done for the past decade?
Well, enough. Democrats are going to have to be ballsy if they want to prevent the destruction of another sensible American ideal. We need to fight back, and we need to start now -- for the radical right is certainly starting now. Here is a handy primer from Digby about how the Republicans destroyed Clinton's healthcare reform -- when the Democrats controlled the White House, the Senate, and the House of Representatives.
We should all read, learn, plan, and act NOW.
Quote from the Digby piece:
"September 19, 1994 - The New York Times reports remarks -- never subsequently denied -- that Bob Packwood made to his Republican senatorial colleagues during closed-door strategy sessions while he was managing the Republican attack during the summer. "We've killed health care reform," Packwood told his fellow Republican senators. "Now we've got to make sure our fingerprints are not on it." For many this is the "smoking gun": proof of a carefully plotted, and secret, Republican strategy."
posted by Ethan at 10:18 PM
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