December 19, 2004

Bush's Social InSecurity Plan

Just keeping track of the shifting lies, misrepresentations and bait-and-switch tactics of the Bush Administration as it slithers toward that Holy Grail of Right-Wing American politics, the dismemberment and destruction of the New Deal's Covenant with America, the 1935 Social Security Act, is a dizzying, mind-numbing task.

And it's meant to be.

It's among the most fundamental of discoveries of the early masters of effective political propaganda in media-dominated, mass societies -- Hearst, Lenin, Mussolini, Hitler -- that one's ideological opponents can be kept permanently off balance and ineffective, endlessly marshalling armies of difficult little facts and seemingly condescending appeals to reason and rationality against the easy big lie that one can tell, re-tell, not tell, offer, modify or drop at a moment's notice. To the effective political propagandist "facts" and "reasons" are just so many deployable, imaginative fictions in a world come unanchored where any hesitation, any self-restraint for fear of inconsistency is nothing but foolish, indeed, "the hobgoblin of little minds, adored by little statesmen and philosophers and divines." Nothing Karl Rove would have any truck with.

And so it's liable to be all for naught, the mushrooming industry of liberal bloggers, columnists, and pundits now laboring, in detail, to answer, refute and, worst of all, strategize a Democratic response to the economics and injustice of a Bush plan for privatizing social security that doesn't yet exist in any detail and -- you can bet your bottom dollar -- won't exist in any detail until the last legislative minute possible.

But if one must, the best place to go to satisfy any but the most insatiable appetite for exposure of Bush's and the rest of the right-wing's lies about Social Security and their own proposals to "reform" and "save" it into non-existence is to Paul Krugman's Op-Ed columns in The New York Times. Though an academic, intellectual, Princeton ivory-tower economist of the first order and (horror of horrors!) a writer of college textbooks on the subject, Krugman almost always manages a no-nonsense, straight-from-the-hip directness in his columns about issues of political economy. He achieves a voice of American middle-class check-book common sense which eludes most other pundits and bloggers, as all too many lose their way and their readers trying to prove they really do know something about the issue they're arguing. On that score, Professor Krugman has the marvelous advantage of having absolutely nothing to prove.

Unfortunately, The New York Times is now fast-tracking its Op-Ed content into its fee-based archive so rapidly that, if you don't stay apace week by week, you're out of luck and either have to pay a couple dollars apiece for the privilege or wait for Krugman's next anthology if you want or need to look back through Krugman's points in this ongoing debate.

For the too poor and too impatient, here are a few samples of Krugman's basic, just plain, fundamentally informative writing, excerpted from his three most recent columns on Social Security:

Inventing a Crisis, December 7, 2004
There's nothing strange or mysterious about how Social Security works: it's just a government program supported by a dedicated tax on payroll earnings, just as highway maintenance is supported by a dedicated tax on gasoline.
Right now the revenues from the payroll tax exceed the amount paid out in benefits. This is deliberate, the result of a payroll tax increase - recommended by none other than Alan Greenspan - two decades ago. His justification at the time for raising a tax that falls mainly on lower- and middle-income families, even though Ronald Reagan had just cut the taxes that fall mainly on the very well-off, was that the extra revenue was needed to build up a trust fund. This could be drawn on to pay benefits once the baby boomers began to retire.
The grain of truth in claims of a Social Security crisis is that this tax increase wasn't quite big enough. Projections in a recent report by the Congressional Budget Office (which are probably more realistic than the very cautious projections of the Social Security Administration) say that the trust fund will run out in 2052. The system won't become "bankrupt" at that point; even after the trust fund is gone, Social Security revenues will cover 81 percent of the promised benefits. Still, there is a long-run financing problem.
But it's a problem of modest size. The report finds that extending the life of the trust fund into the 22nd century, with no change in benefits, would require additional revenues equal to only 0.54 percent of G.D.P. That's less than 3 percent of federal spending - less than we're currently spending in Iraq. And it's only about one-quarter of the revenue lost each year because of President Bush's tax cuts - roughly equal to the fraction of those cuts that goes to people with incomes over $500,000 a year.
Given these numbers, it's not at all hard to come up with fiscal packages that would secure the retirement program, with no major changes, for generations to come.

Borrow, Speculate and Hope, December 10, 2004
Privatization would begin by diverting payroll taxes, which pay for current Social Security benefits, into personal investment accounts. The government, already deep in deficit, would have to borrow to make up the shortfall.
This would sharply increase the government's debt. Never mind, privatization advocates say: in the long run, they claim, people would make so much on personal accounts that the government could save money by cutting retirees' benefits....
Even so, if personal investment accounts were invested in Treasury bonds, this whole process would accomplish precisely nothing. The interest workers would receive on their accounts would exactly match the interest the government would have to pay on its additional debt. To compensate for the initial borrowing, the government would have to cut future benefits so much that workers would gain nothing at all.
How, then, can privatizers claim that they could secure the future of Social Security without raising taxes or reducing the incomes of future retirees? By assuming that workers would invest most of their accounts in stocks, that these investments would make a lot of money and that, in effect, the government, not the workers, would reap most of those gains, because as personal accounts grew, the government could cut benefits.
We can argue at length about whether the high stock returns such schemes assume are realistic (they aren't), but let's cut to the chase: in essence, such schemes involve having the government borrow heavily and put the money in the stock market. That's because the government would, in effect, confiscate workers' gains in their personal accounts by cutting those workers' benefits.
Once you realize that privatization really means government borrowing to speculate on stocks, it doesn't sound too responsible, does it? But the details make it considerably worse.

Buying Into Failure, December 17, 2004
[A]side from giving the Cato Institute and other organizations promoting Social Security privatization the space to present upbeat tales from Chile, the U.S. news media have provided their readers and viewers with little information about international experience. In particular, the public hasn't been let in on two open secrets:
Privatization dissipates a large fraction of workers' contributions on fees to investment companies.
It leaves many retirees in poverty.
Decades of conservative marketing have convinced Americans that government programs always create bloated bureaucracies, while the private sector is always lean and efficient. But when it comes to retirement security, the opposite is true. More than 99 percent of Social Security's revenues go toward benefits, and less than 1 percent for overhead. In Chile's system, management fees are around 20 times as high. And that's a typical number for privatized systems....
Privatizers who laud the Chilean system never mention that it has yet to deliver on its promise to reduce government spending. More than 20 years after the system was created, the government is still pouring in money. Why? Because, as a Federal Reserve study puts it, the Chilean government must "provide subsidies for workers failing to accumulate enough capital to provide a minimum pension." In other words, privatization would have condemned many retirees to dire poverty, and the government stepped back in to save them.

Be that as it may, the problem Krugman shares with nearly all his fellow liberal critics, refuters and general naysayers to the Right-Wing's shifting cover stories for a die-hard Social Security abolitionism now nearly three-quarters of a century old is a reluctance to address the issue in simple, old-fashioned "values" terms. And, however correct the critics' arguments about the fiscal irresponsibility, the utter economic nonsense of the Right's so-called reforms, this reluctance amounts to conceding the ground on which the Right has chosen to fight, the ground it has been preparing for decades.

There are only two good, effective political arguments for maintaining the Social Security Program as currently structured and against the various social in-security plans Bush and the ideological Republican Right are busier than ever fomenting against it. And they are the very same, simple, direct arguments used to pass the Social Security Act in the first place: Prudence and Morality.

Prudence: Although we are famously a nation that values and rewards "risk takers" over all others, it is simply imprudent in a highly mobile, individualized, modern, market-driven global capitalist economy for even the most self-confident and successful of "risk takers" to rush eagerly also to bet their most rudimentary survival and dignity in old age upon unforeseeable, uncontrollable, distant and chance events, least of all upon the ups and downs of the always crashable stock market.

It is all too easily observed, by anyone who bothers to look beyond their own rosiest hopes and dreams, that, over the course of any human life-span, the race does not invariably go to the swiftest, the smartest, the richest, the bravest, the balls-iest, the most well-prepared, most well-connected, no, not even to the whitest. Better, if at all possible, in case all else fails, to keep that last, simple ace in the hole: At least, I'll still have the freedom to eat without begging when I'm old and helpless.

Any degree of "privatization," "individualization" of Social Security, whatever its possible or promised benefits, amounts to a political renunciation of what, since the 1930s, has come to be regarded as a basic human right in America to a certain minimum standard of independence and dignity in old age. To be an American, not someone struggling for existence on the margins of brutal third and fourth world economies, but to be a member of the powerful, privileged society that America is and prides itself on having become, and to choose to put at risk your own as well as your fellow Americans' baseline, long-term security for no more than some hope of gain is nothing but a bet for fools in the process of being taken for everything for which they can be taken.

Prudence, in this sense, is just a polite term for knowing a sucker bet when you're offered one.

Morality: Despite the best efforts of the Cato Institute and other right-wing ideology factories to convince us that the sum total of all legitimate moral principle, reasoning and feeling is contained and exhausted in Patrick Henry's "Give me liberty or give me death!" the Social Security debate poses issues of a somewhat broader moral scope. Reducing morality to a choice between the abstract absolutes of Liberty or Death makes for as fine a recruiting slogan for suicidal idealists and other insurgents against occupying imperial powers today in Gaza and the West Bank, and now Iraq, as it did during the American Revolution, but it's hardly a sound basis for public discourse in a stable, established, humane society.

Most simply put, the question of Social Security is whether we as a nation and as individuals are morally prepared to return to a society in which we, the young, the healthy, the affluent, live alongside a significant number of our elderly fellow citizens who have been condemned to go hungry and homeless due to circumstances, accidents, mistakes, and even youthful irresponsibility now beyond their diminished capacity to rectify. Are we prepared emotionally and intellectually for such suffering? Can we justify it morally? Not in terms of the suffers' deserts, just or unjust. Nor in terms of systemic functioning or economy, efficient or inefficient. But in terms of our own morality, our own standing and conscience as human beings sharing life with those less fortunate than ourselves. How far, despite all our loose rhetoric to the effect, are we actually prepared to slide toward an America in which life is truly, voluntarily, designedly, as a matter of public policy choice just a matter of "the survival of the fittest"?

Not surprisingly, the advocates of Social Security privatization, dismemberment and destruction never put the moral choice of Social Security this way. Even their most hell-fire and damnation Evangelical followers might pause over such a vision of market-based "jungle justice" meted out, without possibility of redemption, upon themselves, their near and dear, and members of their own communities. The supposed "immorality" of a government of "We, the People" taxing some of your own and everybody's hard-earned wages to sustain your elders just wouldn't stand up too well in a head-to-head face-off against Jesus' second greatest commandment "to love thy neighbor as thyself." But in America today, however we might wish it otherwise, where family and community simply lack the resources and resilience they once had to cope successfully with all-too-common human misfortune, that Christian moral commandment, that moral fundamental beyond all religious and secular divide, is precisely the common human duty that the would-be privatizers of social security are asking us to flout.

To find in this century the effective political language to make such points to the American people in a way that builds consensus where none might appear to exist, one need look no further than backward to the proven, effective language of the last century. For those who have never read or heard it, here is President Franklin D. Roosevelt better making the same two arguments of Prudence and Morality as they confront us as fellow citizens of modern, capitalist America:

A Social Security Program Must Include All Those Who Need Its Protection. RADIO ADDRESS ON THE THIRD ANNIVERSARY OF THE SOCIAL SECURITY ACT. AUGUST 15, 1938
You, my friends, in every walk of life and in every part of the Nation, who are active believers in Social Security:
The Social Security Act is three years old today. This is a good vantage point from which to take a long look backward to its beginnings, to cast an appraising eye over what it has accomplished so far, and to survey its possibilities of future growth.
Five years ago the term "social security" was new to American ears. Today it has significance for more than forty million men and women workers whose applications for old-age insurance accounts have been received; this system is designed to assure them an income for life after old age retires them from their jobs.
It has significance for more than twenty-seven and a half million men and women wage earners who have earned credits under State unemployment insurance laws which provide half wages to help bridge the gap between jobs.
It has significance for the needy men, women and children receiving assistance and for their families--at least two million three hundred thousand all told; with this cash assistance one million seven hundred thousand old folks are spending their last years in surroundings they know and with people they love; more than six hundred thousand dependent children are being taken care of by their own families; and about forty thousand blind people are assured of peace and security among familiar voices.
It has significance for the families and communities to whom expanded public health and child welfare services have brought added protection. And it has significance for all of us who, as citizens, have at heart the Security and the well-being of this great democracy.
These accomplishments of three years are impressive, yet we should not be unduly proud of them. Our Government in fulfilling an obvious obligation to the citizens of the country has been doing so only because the citizens require action from their Representatives. If the people, during these years, had chosen a reactionary Administration or a "do nothing" Congress, Social Security would still be in the conversational stage--a beautiful dream which might come true in the dim distant future.
But the underlying desire for personal and family security was nothing new. In the early days of colonization and through the long years following, the worker, the farmer, the merchant, the man of property, the preacher and the idealist came here to build, each for himself, a stronghold for the things he loved. The stronghold was his home; the things he loved and wished to protect were his family, his material and spiritual possessions.
His security, then as now, was bound to that of his friends and his neighbors.
But as the Nation has developed, as invention, industry and commerce have grown more complex, the hazards of life have become more complex. Among an increasing host of fellow citizens, among the often intangible forces of giant industry, man has discovered that his individual strength and wits were no longer enough. This was true not only of the worker at shop bench or ledger; it was true also of the merchant or manufacturer who employed him. Where heretofore men had turned to neighbors for help and advice, they now turned to Government.
Now this is interesting to consider. The first to turn to Government, the first to receive protection from Government, were not the poor and the lowly--those who had no resources other than their daily earnings--but the rich and the strong. Beginning in the nineteenth century, the United States passed protective laws designed, in the main, to give security to property owners, to industrialists, to merchants and to bankers. True, the little man often profited by this type of legislation; but that was a by-product rather than a motive.
Taking a generous view of the situation, I think it was not that Government deliberately ignored the working man but that the working man was not sufficiently articulate to make his needs and his problems known. The powerful in industry and commerce had powerful voices, both individually and as a group. And whenever they saw their possessions threatened, they raised their voices in appeals for government protection.
It was not until workers became more articulate through organization that protective labor legislation was passed. While such laws raised the standards of life, they still gave no assurance of economic security. Strength or skill of arm or brain did not guarantee a man a job; it did not guarantee him a roof; it did not guarantee him the ability to provide for those dependent upon him or to take care of himself when he was too old to work.
Long before the economic blight of the depression descended on the Nation, millions of our people were living in wastelands of want and fear. Men and women too old and infirm to work either depended on those who had but little to share, or spent their remaining years within the walls of a poorhouse. Fatherless children early learned the meaning of being a burden to relatives or to the community. Men and women, still strong, still young, but discarded as gainful workers, were drained of self-confidence and self-respect.
The millions of today want, and have a right to, the same security their forefathers sought--the assurance that with health and the willingness to work they will find a place for themselves in the social and economic system of the time.
Because it has become increasingly difficult for individuals to build their own security single-handed, Government must now step in and help them lay the foundation stones, just as Government in the past has helped lay the foundation of business and industry. We must face the fact that in this country we have a rich man's security and a poor man's security and that the Government owes equal obligations to both. National security is not a half and half manner: it is all or none.
The Social Security Act offers to all our citizens a workable and working method of meeting urgent present needs and of forestalling future need. It utilizes the familiar machinery of our Federal-State government to promote the common welfare and the economic stability of the Nation.
The Act does not offer anyone, either individually or collectively, an easy life--nor was it ever intended so to do. None of the sums of money paid out to individuals in assistance or in insurance will spell anything approaching abundance. But they will furnish that minimum necessity to keep a foothold; and that is the kind of protection Americans want.
What we are doing is good. But it is not good enough. To be truly national, a social security program must include all those who need its protection. Today many of our citizens are still excluded from old-age insurance and unemployment compensation because of the nature of their employment. This must be set aright; and it will be.
Some time ago I directed the Social Security Board to give attention to the development of a plan for liberalizing and extending the old-age insurance system to provide benefits for wives, widows and orphans. More recently, a National Health Conference was held at my suggestion to consider ways and means of extending to the people of this country more adequate health and medical services and also to afford the people of this country some protection against the economic losses arising out of ill health.
I am hopeful that on the basis of studies and investigations now under way, the Congress will improve and extend the law. I am also confident that each year will bring further development in Federal and State social security legislation--and that is as it should be. One word of warning, however. In our efforts to provide security for all of the American people, let us not allow ourselves to be misled by those who advocate short cuts to Utopia of fantastic financial schemes.
We have come a long way. But we still have a long way to go. There is still today a frontier that remains unconquered--an America unclaimed. This is the great, the nationwide frontier of insecurity, of human want and fear. This is the frontier--the America--we have set ourselves to reclaim.

Let Bush, Rove, the Cato Institute, and the rest of the right-wing, con-artist, mass-media propagandists of privatizing and dismantling America's Social Security System try arguing against that for a change.

Arts and Sciences

As human beings dwelling within modern, mass media swept, "information age" societies, it always behooves us to recall that we are not all equally utter novices at the art and science of political propaganda, public relations, advertising, marketing, whatever you wish to call the means by which our opinions, hopes, dreams, our very desires may be and often are molded and directed. Some amongst us are highly educated, whether formally or experientially or most often both, in these arts, these sciences, possessing proven-effective skills that command, bottomline justifiably, among the highest salaries paid in the world today. No product of novices endlessly reinventing the wheel, the achievements of this sort possible today are so because today's practitioners stand, as the saying goes, "on the shoulders of giants" in their chosen profession:

[T]he magnitude of a lie always contains a certain factor of credibility, since the great masses of the people in the very bottom of their hearts tend to be corrupted rather than consciously and purposely evil, and that, therefore, in view of the primitive simplicity of their minds they more easily fall a victim to a big lie than to a little one, since they themselves lie in little things, but would be ashamed of lies that were too big. Such a falsehood will never enter their heads and they will not be able to believe in the possibility of such monstrous effrontery and infamous misrepresentation in others; yes, even when enlightened on the subject, they will long doubt and waver, and continue to accept at least one of these causes as true.
--Adolf Hitler, Mein Kampf, Vol 1, Chapter 10
Posted by Raoul

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