The Dionne column and the Krugman one from yesterday are all you need to know about the latest Bush gambit on Social Security.

Dionne is right that this is a sucker's game and the Democrats should walk away from it.

When the Dems play the GOP game, we all get screwed. Soto is correct, the Dems need to stay united and away from fake compromises that will be reversed. Dems need to hammer two points: First, SS is a good plan that works for everybody as it is intended - SS is the Plan! Second, hammer the truth about where it is and where it is going to be, yes there are issues to be dealt with and be candid about that. Contest all the GOP lies and misdirection about bankruptcy, etc. Tell the truth about were we stand. Keep the focus on how the GOP wants to protect the rich and screw the middle and lower.Tell the GOP to stuff it. The American people are on the Dem side here - use the hammer not The Hammer.

You can understand the secret to Bush's past successes by remembering the unanswered physics question: what happens when the irresistable force meets the immovable object? One thing is certain--unless the Democrats learn to be immovable, Bush's unyielding agressive position will always win.

Many here like to equate Social Security to an insurance plan. A "safety net" is a common theme.

When you buy insurance, what does the insurance company do with the monthly premiums? Does it use the premiums for general expenses and overhead? Well, some of it. As all companies do when they price their products, a certain amount is included to cover the costs of doing business.

The insurance company does something else with the money outside of covering general expenses. The insurance company invests the money. Investments consist of stocks, bonds, and real estate.

Of course, this is where the current social security system fails. They only cover expenses, and then the rest of the money, instead of being invested, goes into the general fund and gets spent on other federal programs. There is no investment.

So, if you want social security to be like an insurance "safety net," it must by definition, have an investment component.

"So, if you want social security to be like an insurance "safety net," it must by definition, have an investment component."

No, not really, but even conceding the point, the Trust Fund INVESTS in Treasury Bills.

Dionne's column was brilliant. He put it just right. Why play in a rigged game? The fact is, the Republicans can do anything they want. They've got the power. They can't blame Democrats for obstructing a damn thing. When they say it has to be a bipartisan solution, they're just fucking liars. They can pass this idiotic plan if they want to--they just have to face the consequences. If they don't want to face consequences for actions that they want and we don't, that does not mean we're obstructing them.

This whole thing reminds me of when schools mistakenly try to get bullies and victims to work out their problems by sitting together and negotiating. You know the bully is laughing his ass off and the victim is being doubly victimized. The only power sometimes is refusing to engage. And I think we're just beginning to learn what a great power that is.

You have some learnin' to do, Weiner. What happens when those T-Bills come due? They're replaced with more T-Bills.

You know, a lot of people do the same thing with their credit cards. They run 'em up, and when the bill comes due, they just transfer the balance to another credit card.

WHERE DOES THE MONEY COME FROM? At some point, real money has to enter the picture.

And that's the problem with transfering credit card balances around from card to card, or playing the T-Bill Accounting Gimickry with Social Security.

At some point, money has to be earned via wage/income growth or from investments to make it work. Otherwise, it does not work. And that's the current system.

T-bills are real money. In fact, the good faith and credit of the United States is all that backs up the almighty dollar.

The trust fund is conservatively invested in T-bills.

Now, as for Social Security, as Wobblie has pointed out at D-Kos, the Social Security gambit is just a ruse to block discussion of the real crisis in America, healthcare. Reid and Pelosi should take action forthwith to shift the discussion to healthcare anytime they bring up Social Security, the issue the White House doesn't want you to think about.

THE DEMS HAVE TO "JUST SAY NO" TO BUSH'S CRIMINAL PLAN. I suspect the dems are too cowardly to put up a fight. I hope I am wrong but we shall see.

muckdog,

Understand your insurance analogy completely. But most people refer to S.S. as insurance in the sense that it's like term life insurance or disability insurance. If you don't use it before you expire you get nothing back. Only in this case you expire instead of the insurance. That's the way insurance companies make money. They collect more in premiums than they pay out. They count on a percentage of people covered never making a claim. S.S. does the same thing.

Didn't Clinton propose investing the surplus back in the nineties?

Muckdog, why do you hate the American people? Why would you support bush's destruction of social security? A plan that has probably helped many of your relatives. What has brought you to a place where you hate your own country men so much. I understand bush - he has total contempt for the American people. We know bush's history but I'm just curious how you got to such a place.

One thing that I don't understand - how come muck can see that Social Security investment in T-bills is a bad thing, yet the federal deficit being increased through major tax cuts only for the wealthy isn't?

Somehow, the use of T-bills for Social Security investment wouldn't be such an issue if the federal government wasn't being bled to death through the application of tax cut leeches by the GOP supply-sider spin doctors in an effort to cure the patient.

Of course “blocking with their whole weight” is the appropriate response from the Democrats, but alas, they don’t have the guts. Congressional Democrats don't seem to realize that the fight is desperate and necessary. While they have a front row seat to an all out effort to destroy democracy, separation of powers and the constitutional balance of power, they seem to think that reasonable Republicans will appear and the Senate will proceed through compromise to reach a balance. While they are surely aware that even a balanced bill will be unbalanced in conference, Democrats, like Kerry, seem unwilling to label the radical right the radical right OR they seem to feel that, in fact, the right is right in their belief that America is a right wing, fundamentalist country. So "democrats" and "liberals" need to disguise their philosophy. Social Security is only one battle in this war. Gore and Kerry both campaigned like it was politics as usual, though they had just witnessed an attempted coup against the President.

I'm sorry for feeding the troll. It's arguments are too stupid to bother to refute.

Muckdog,

It is a lost cause to discuss SS with these people because, as you stated before, they are not intellectually honest about it.

Most of them have no idea how well they will do investing in the morket (stocks, bonds or M.F). Whether it is a bull or a bear.

The number 1 problem continues to be uneducation on investing money. I said before that we need to require all students before graduation to take a class that deals with real world financial issues. It is the only way to fix what is wrong with SS.

Muckdog,

Do you remember when the President said this last week?:

“I know some Americans have reservations about investing in the stock market, so I propose that one investment option consist entirely of Treasury bonds, which are backed by the full faith and credit of the United States government.”

Linked text

These are the same Treasury bonds that we give to our creditors that we continue to borrow a gigantic amount of money from, China, Japan, Russia, etc.

And we also use Treasury bonds to supplement our credit in SS.

Please ascertain the difference between having full faith and credit of the US government to pay for those bonds for SS, and those bonds given to other countries.

You ask:

WHERE DOES THE MONEY COME FROM? At some point, real money has to enter the picture.

Why is it so difficult for you to understand that we have very little problem with rolling back the tax cuts to the top 1%, which would keep the system solvent for at least the next 75 years, if not more?

Or how about raising the payroll cap?

Or how about cutting the benefits just a tad for early retirees, thus giving them an incentive to hold out a few years longer for full retirement?

The lower and middle class have been paying the brunt of this payroll tax since ’83. If Bush wasn’t borrowing so damn much from the Treasury to pay for his tax cuts to the affluent, we wouldn’t be having this conversation now, would we?

And please refrain from your 2009 doomsday date straw man. I replied to that argument before – just because the annual amount of surplus begins to decrease on that date does NOT mean we need to supply any more money at that time – we will STILL have a surplus to run on until at least 2017 (ssa horribly conservative estimates), or 2020 (CBO estimates). Only after that point do we start cashing in on our Treasury bonds, which according to our President are backed by the full faith and credit of the US gov’t. Is Bush lying when he says they are not backed by full faith and credit?

bigdog,

With all due respect, I think you need to spare us on who's being intellectually dishonest here. How many times has the President stated that the system will be "bankrupt" in 2042 (now 2041)? How is 80% of expected benefits "bankrupt"? How is "the money is yours to invest how you choose" intellectually honest when you will ACTUALLY have only 5 or so different choices to invest, and which NONE of those choices you have any say as to what stock companies are given? How is it intellectually honest to blatantly IGNORE a much bigger Medicare issue that's going to bite us all in the butts much much earlier than SS, thanx much in part to Bush's Prescription drug plan which we were all scammed into believing was hundreds of billions of dollars cheaper than the actual cost?

And as I've said before, I don't disagree with your idea of a mandatory financial course in high school. In fact I'd fully support such a notion. The question is, with the continual underfunding of public education by this President, can you be intellectually honest enough to admit the reality of such an idea is not too good?

Mr. O,

As a teacher, I can honestly say I can't stand the Federal Government getting involved in education at any level. I have and will always believe that it should be a local matter (I'm actually against State Involvement) because they continually screw things up. When it comes to Education it is not about money (or at least should not be). There is no correlation between the amount of money spent per pupil and the performance of the school district. The school districts that perform well, do so because of the most important thing in any child's life...Parental involvement. I'm currently talking with several state senators and reps from the Ohio General Assembly, trying to convince them of my idea for senior financial eduction. Will it go anywhere? Hell No, because it makes to much sense. But thanks for your support, I really do appreciate it.

As for SS, I would prefer that people be forced to invest it, but invest however they see fit. I know that is not possible, so I would at a minimum like to see either the Presidents proposal worked out, or even use President Clintons idea from 1996. Either way, the money given to SSA must be invested and at least given a chance to grow somewhere. The way I understand it (correct me if I'm wrong) but the five or so places to invest, are mutual funds that invest in "Blue Chip" stocks and bonds. It will be severly diversified which is great because the chances of the fund "tanking" are incredibly slim. I've said it many times, my problem with SS is the returns (or lack of).

bigdog,

I understand your biggest gripe with SS returns, but those are not my gripes at all. And I think we're coming to that point of agreeing to disagree here, because the solution I see does not involve privatization, nor do I think of the problem being that people are not smart enough to invest (though I won't deny there is some definite truth in that).

Could SS returns be better? Well who wouldn't want that? I certainly wouldn't argue against that, and I do realize Clinton had the notion of investing a small portion of the SS surplus into the market. In hindsight I think it was fairly wise of that idea not to come to fruition, wouldn't you think?

Regardless, privatization like Bush's Plan 2 does not in any way address the problem of individuals losing out during a market's downturn. Granted, they are growth funds and would likely be dispersed widely, but please don't tell me that funds don't lose out during downturns and recessions. What on earth do we say to those who retire during those times? Tough peanuts, bub?

And to those uneducated individuals who put their money in high-risk funds and lose out big -do we say the same to them?

Well wouldn't it rather serve everyone's interests better to have a safety net that allows a small but descent cushion to land on, just in case?

And you mentioned once before that too many people rely on SS now for retirement, but you did not address the crucial reason here - the cause of this is NOT because SS has low returns. Rather, it is because corporations have dwindled down secure pension and 401K plans. Your argument of giving a higher rate of return here is like treating the problem without addressing the cause.

But whether or not the returns could be better does not in any way address the major losses in benefits privatization would bring, nor does it address how exactly we would pay for the disabled and survivors' insurance. Furthermore, and I think is what's more important to both Democrats and fiscal Republicans, it makes our current fiscal situation absolutely horrible with the $ owed in transition costs, let alone paying for both government SS and opting out for Bush's Plan 2 over the long haul.

As for being a teacher, both my parents are teachers so I can certainly sympathize with you and agree with your point about fiscal responsibility in school districts. However, my point still stands that without any $ to pay for such a mandatory program, it simply is not realistic. Unless, of course, we continue to cut other school programs like Fine Arts, biology courses (happened here in Lawrence, KS), Phys. Ed. courses, and other programs that most of us old farts at one time considered pretty important to an overall sound education.

bigdog,

One other thing - Most Dems. and a good number of Republicans have come out in support of add-on accounts - accounts that supplement SS. This would essentially be a governmental 401K plan of sorts that would be in addition to SS. Since we have seen a dwindling of business 401K and pension plans occurring over the past coupla decades, I see no reason why anyone shouldn't support this truly voluntary program, do you?

Mr. Opus,

No, I don't see a problem with your last point, or your point about Clinton. Hell I supported that idea 100%. The problem with the last part is Voluntary! It should be Mandatory...even if it is only $20 a month. You start that at the age of 22 (if you go to college) or at 18 for those that don't, now we are talking about a confortable retirement...which is all i want.

Secondly, The disablility insurance part is a problem that most definantly needs to be addressed and I've stated that in the past. The survivor part however, is something that would dramatically benefit from private accounts. Because, unlike SS, the survivor is guarenteed to get the money. With SS, they are not guarenteed to recieve the money. I have a very personal example if you would like it.

About the Educational aspect. Schools definantly need to be held fiscally accountable that way program like Biology (which I find amazing) don't get cut. This is why I hate the Federal Department of Education. Nothing should be mandated by them whatsoever, because community standards vary widely. But my overall point about Schools and Money was that it does not matter how much they spend per pupil, because if their is not parental involvement, not only will the child fail, but the school district as a whole will fail. This is why private schools produce a higher graduation rate in H.S. and of students that attend universities. Because generally, Private schools have parents that are thouroughly involved in their chilrens lives. If you look at the amount of money spent per pupil between public and private schools, you would be amazed at the spending difference. If I remember correctly the average money spent in public schools is about 8,000 per pupil; and just over 2500 per pupil in private schools.

Unless the government is going to start holding parents accountable for their childs grades, then they should keep their money and their ideas out of education all together.

bigdog,

I'll save the argument of public vs. private schools for another time. It's a good debate, but one that's a bit tangential to this particular SS topic.

But in regards to the part about not getting SS benefits to survivors, what do you mean? I read that one personal post of yours a few days back about your family. Where does it state on the SS website that you would not receive those benefits when your other parent retires?:

Linky

Does it not explicitly state:

"Social Security survivors benefits can be paid to:

*A widow or widower -- full benefits at full retirement age (currently age 65), or reduced benefits as early as age 60"

???

Because my mother will have worked more years than my father. Thus her benefits will be greater than my fathers, and she will only draw on hers.

I did not believe her when she told me, so I too checked the website, called both senators (voinovich and Dewine) and my local represetatives. I recieve the same answer all three times. My fathers money that he paid into SS will never be recieved by any member of our family. Now I never wanted it, but I definantly think that my mother should recieve it. But she won't, because she will work for another 13 years.

The SSA has even responded in writing stating basically what I just said, only with bigger words and more mumbo-jumbo.