Tuesday :: Jan 11, 2005

How The Bush Social Security Plan Is Being Tailored For Wall Street Support


by Steve

Here's another example of how Bush's Social Security privatization plan is being constructed as the just the latest GOP Corporate Welfare scam.

The Times runs a story this morning from Edmund Andrews that reports on the pitch made to Wall Street by Treasury Secretary John Snow in selling the yet unannounced Bush Social Security privatization plan. Aside from the fact that Wall Street is not convinced that the massive new debt Bush’s plan requires will have no impact upon interest rates or borrowing, there was this:

Despite the apparent windfall in business that could create, many Wall Street executives are less than enthusiastic about administering tens of millions of very small accounts if, as is likely, the government forces them to charge much lower fees than on traditional mutual funds.

But administration officials have already signaled that the government would probably take responsibility for accounts of less than $5,000, relieving financial companies from dealing with millions of accounts that would probably be unprofitable.

The government will manage accounts of less than $5,000 because they won’t be profitable for Wall Street to manage? This is just another confirmation that Social Security is Corporate Welfare. In other words, Wall Street will get to cream off the larger monied accounts to reap fees from, while the federal government will still need a bureaucracy in place to manage the small accounts. Wall Street gets all the benefits and the taxpayers still are footing the bill, while getting significantly smaller benefits themselves.

Steve :: 7:45 AM :: Comments (32) :: Digg It!