Selling out Social Security

 

Stealing from American Workers: The Truth About the Social Security Debate

The evening news will tell you that the Social Security debate is only about politicians posturing for the next election. That's a bunch of hooey. This debate is about: (1) taking money from American workers by force (i.e., FICA taxes), (2) promising those workers the FICA money will be returned in some form in the future (i.e., future SS benefits), and (3) giving the workers' FICA money to someone else because it's politically expedient (i.e., subsidies to your best contributors or to fund your favorite pet projects). That's stealing under any definition I know.

http://www.democrats.com/view.cfm?id=4270

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Here's a scary thought:

Bush said last week the Social Security fund should not be tapped unless the nation was at war or in a recession (Tall. Democrat 8/28/01)

	Social Security won't go untouched  ...Bush said last week the Social Security fund should not be tapped unless the nation was at war or in a recession. CBO analysts say the economy should "narrowly" avoid a recession, but they project growth next year at 2.6 percent, compared with a 3.2-percent growth forecast by the White House.
	'All-out war' in Mideast?  Tanks enter village; leader killed  JERUSALEM - Israeli tanks rolled into a Palestinian village on the southern fringes of Jerusalem early today in an effort to halt persistent Palestinian gunfire on a nearby Israeli neighborhood. At least one Palestinian was killed.
	Pilotless plane missing in  It may have crashed or been shot down WASHINGTON - A pilotless U.S. reconnaissance plane failed to return from a mission over southern Iraq on Monday. U.S. officials did not dispute Iraq's claim that it shot down the plane.
	(The Twin towers attack was unimaginable on 8/28/01, when this was written, but in hindsight it seems to fit right into the scenario...)

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Social Security System's Fiduciary Takes First Step Towards Destruction of Social Security

 

Bush didn't win the election, and has no mandate to take the radical step of privatizing Social Security. But Treasury Secretary Paul O'Neill - who has FIDUCIARY responsibility for the Social Security system - is militantly determined to "get it done," as they say in Bushspeak. He has teamed up with  (probably even assembled) a group of Wall Street firms that would make huge profits by putting the nation's retirement fund at risk. If you like electricity privatization, you'll LOVE what they do to Social Security. Can you spell N-A-S-D-A-Q? It looks like Americans will have to organize a boycott of the participating Wall Street firms...

www.washingtonpost.com/  (democrats.com/daily news)

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What is the Cato Institute and why are they writing Bush's social security privatization package?

The Cato Institute ... has supplied Congress with its 680-page "Handbook for Congress." The plan? Eliminate the Departments of Commerce, Energy, Agriculture, Interior, Veterans Affairs, Transportation, and Education; "prohibit new entrants to the welfare rolls"; and "end all federal early education and child care subsidies and programs." It also calls for disbanding the IRS, the Environmental Protection Agency, the Drug Enforcement Administration, the National Endowment for the Arts, the Consumer Product Safety Commission, the Small Business Administration, and some 200 other agencies and programs. Cato opposes any limits on campaign contributions and wants America to withdraw from the International Monetary Fund.  ... the NewRepublic

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IN LOSING $1.35 trillion of federal revenue to George W. Bush's tax cut, the Democrats lost an important battle, but maybe they haven't lost the war. The war, in this case, is a principled conflict between two contending philosophies of governance and the good society. Should people fend mostly for themselves or should some needs be provided socially? In this debate, conservatives want to shrink social spending. Since the Reagan era, the Republican grand design has been to starve government for resources. President Reagan accomplished that, big time, with his massive tax cut of 1981.That tax cut was responsible for more than a decade of spending cuts and escalating budget deficits, which increased the national debt by more than $3 trillion. The Democrats barely got those deficits under control and began to contemplate restoring some social spending when the Republicans came back in and cut taxes again. Seemingly, Bush's $1.35 trillion tax cut, most of it to the wealthy, removes money that might have been spent on social outlays that Democrats (and many independents and even Republicans) support: more reliable health coverage, better schools, comprehensive child care, and so on. This philosophy of government, derided by Republicans as ''tax and spend,'' is actually what made Democrats popular.The original version of that line, spoken by Franklin Roosevelt's New Deal aide Harry Hopkins, was ''tax and tax, spend and spend, elect and elect.''It was spending programs like Social Security and Medicare, the GI Bill, and postwar programs for housing and education that made Democrats the majority party. If Democrats have forgotten that, Republicans haven't. More than one Republican strategist observed that if Democrats ever got to spend the surplus on popular social needs, they would be the majority party again.This option is now, supposedly, moot. But let's not forget that tax policy fluctuates between cuts and increases. Even Ronald Reagan's massive tax cut was barely in force when his own budget advisers realized it was excessive.There were no fewer than nine major tax increases enacted between 1982 and 1992, when the presidents were named Reagan and Bush. Most of these increases were sponsored by Democrats, and most of the impact hit the rich, not the middle class.According to US Treasury statistics, for example, the 1982 tax act increased revenues by $130 billion in its first four years. The 1984 Deficit Reduction Act increased tax collections by $72 billion in four years. And this under Ronald Reagan! Under Bush the elder, Democrat-led bills increased revenues by more than a hundred billion dollars more. If ordinary voters were upset, they certainly didn't show it. In 1992 they returned a Democrat to the White House. And Bill Clinton promptly raised taxes again (on the top 2 percent of taxpayers) to finally undo the damage of the first Reagan tax cut and turn the deficit to surplus. So the stage is set for a repeat of these battles, assuming that the Democrats can recover some nerve.George W. Bush has actually made it easier for Democrats by budgetary sleight of hand that backloaded the tax cut. To disguise the real impact on government revenues, the tax cut is rigged so most of it doesn't take effect until after 2005. In other words, if the Democrats take back the White House in 2004, they could rescind much of the tax cut on the upper brackets before it ever takes effect. This would not increase anyone's current tax rates but merely expunge a future tax giveaway that never should have been enacted. And thanks to budget rules that Bush lacked the votes to waive, the entire tax cut expires in 10 years, when the tax code must revert to its present form unless Congress extends the cuts.In the 2002 midterm elections and in the 2004 presidential contest, the Democrats could starkly frame the national choices that they so pitifully failed to pose in 2001: Do Americans want better health coverage or tax cuts for millionaires? Do we want better schools or repeal of the estate tax on the top 2 percent of Americans? Throughout the tax debate, polls continued to show that desired social spending is more popular than tax cuts. So the Democrats did not lose the country on this issue; they were simply outmaneuvered inside the Beltway. Properly designed and articulated, tax and spend remains sound politics as well as the necessary instrument of a decent society. Democrats shouldn't run from that. They should wear it as a badge of honor. Robert Kuttner is co-editor of The American Prospect. His column appears regularly in the Globe. from Tallahassee NOW

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