Democratic Underground

Bush's "Piratization" of Social Security

January 11, 2005
By Vermeer

Bush is siccing the investor class on the worker class.

Which are you? If you make more of your income from work than you earn from investments, you are part of the worker class; if you make most of your income from investments, you may be part of the investor class - unless, of course, you are retired and are no longer earning income from current labor.

Clearly the big Wall Street investment companies that contribute heavily to Bush's and other Republican political campaigns stand to gain billions of dollars from fees and commissions if Bush manages to "piratize" Social Security. No, I did not misspell "privatize," I spelled it "piratize" because the root word here is pirate.

If you are middle-class or poor and support Bush's "piratization" of Social Security, you have been brainwashed and bamboozled. If you work for a living and support Bush's "piratization" of Social Security, you have been brainwashed and bamboozled.

Social Security is not broke or going broke, and Bush's "piratization" plan for Social Security will harm all but the wealthy and elite investor class. Let's discuss "insider trading": Bush will undoubtedly relax or remove the regulations barring Wall Street insiders from profiting from "insider trading," and where will the ordinary investor be then? Out in the cold, and broke.

Social Security is not in crisis; it is the healthiest government program ever. It is solvent and will be solvent for the next 75 years - and beyond, if the Bushites will just stop robbing money from the Social Security trust fund which is generating surpluses in excess of $150 billion a year.

For 20 years, we have been paying extra into Social Security to provide for the baby boomers' retirement years. It was Ronald Reagan, at the urging of Alan Greenspan, who increased Social Security taxes just to provide for the coming retirement of the baby boomers. It is beyond gullibility to believe lawmakers just recently woke up and discovered the baby boom generation will start retiring soon. We have been paying extra into the Social Security trust fund for 20 years to provide for them.

Currently, there is a surplus of $153 billion more per year flooding into the Social Security trust fund than is being paid out to retirees.

Leading economists, and the Congressional Budget Office, tell us that even if Congress does nothing, the Social Security trust fund will not run out of funds until 2052. Even then the system will not be bankrupt and, by using then-current revenues, Social Security will be able to pay retirees 80 percent of their promised benefits. That's if Congress does nothing at all. [Source: Congressional Budget Office Report "The Outlook for Social Security"]

The "fix," if one is needed, is simple and fair. Raise the ceiling on the income taxable for Social Security. Americans at the upper income levels have benefited the most from Bush's past tax cuts and can easily afford to pay a bit back into Social Security, which they also receive at retirement.

Social Security is not only far from bankrupt, it is the most successful and most scandal-free government program ever, and the administrative costs - less then 1% - to run it are far below what Wall Street will charge investors for private accounts. The investment houses have profit as their goal, whereas Social Security is an insurance policy to protect Americans from the vicissitudes of the stock market.

Be warned - we are about to be treated to the same lying prelude to destroying Social Security that we were treated to in the buildup to the Iraq war. The Iraq war buildup was done with smoke and mirrors and threats of "mushroom clouds" over Manhattan. The Bushite effort to destroy Social Security will be as full of lies and scare tactics as the buildup to invading Iraq was. Americans of all ages must be on guard against the lies the Bushites will tell, and have been telling for years.

Bush and other Republicans are being profoundly dishonest when they claim Social Security is going broke; it is not.

So, what is the problem? Bush has been "borrowing" from the Social Security trust fund in order to wallpaper over the fact that he cannot or will not balance the federal budget. He has been giving tax cuts to the wealthy but has not been cutting the amount the government spends. America is spending more than it is collecting in revenue. What happens when people spend more than they take in? Most go into debt.

The difference between Bush and the American people, though, is that when he wanted to give even more tax cuts to the wealthy elite - and hide from the American people the extent to which he was mismanaging our economy - he simply took the money from the Social Security trust fund. True, he left some I.O.U.s in the "box" to acknowledge what he had done - but now he doesn't want to pay back what he has borrowed.

So, what is his solution? He tells us Social Security is going broke and must be destroyed.

Think of it this way: You have spent more than you earn each year and have borrowed to the hilt from your neighborhood bank. Now the moment has come for you to start paying back what you owe the bank, but you still don't have sufficient finds to do so, because you are sending money to your rich Uncle and Aunt (in hopes they will mention you in their will). What can you do? If you are George W. Bush you simply blow up the bank, and the problem is solved.

Bush owes Social Security more than he is willing to pay back, and (in the expectation they will fund his ideological battles) he continues to give his rich corporate "aunts" and "uncles" more and more tax breaks - and is betting he will be able to blow up Social Security.

Bush is amassing a war chest to fund an advertising blitz that will hypnotize Americans into believing him when he says Social Security is in crisis. There is no similar effort possible among Social Security's defenders, because most of those who need and rely on Social Security cannot afford to donate huge sums to sponsor ads telling the truth: that Social Security is not in crisis and is not going broke. On the other hand, the Wall Street investment houses - eager to gather in billions, if not trillions, of dollars in profits from fees and commissions - are more than energized to spread Bush's deceitful message.

It is up to all of us to make sure George W. Bush does not get away with this horrendous deception.

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