A vote on privatization still on track for this year

August 18, 2005

I know it doesn’t make any sense, but it appears congressional Republicans seriously believe it’s a good idea to bring a Social Security privatization plan to the floor for a vote this year.

The House will likely vote this fall on a Social Security bill to let workers put part of their payroll taxes into U.S. Treasury bonds that they would own, Republican leadership officials say.

Whether the trimmed-down personal retirement accounts, known as “grow accounts,” will be part of a more comprehensive retirement reform bill being put together by Ways and Means Chairman Bill Thomas of California, or passed separately, is not clear right now, a senior House leadership official said yesterday.

But it is certain that bond-only investment accounts will come up for a vote in the House chamber later this year, one way or another, he said.

As the plan is shaping up, Republicans are eyeing what they call “grow” accounts, which popped up fairly late in the Social Security debate. Under the scheme, private accounts would be financed through the existing Social Security trust-fund surplus. Conservatives think it’s the magic bullet that solves all the political problems for the GOP.

The grow-accounts plan, sponsored by Ways and Means Social Security subcommittee Chairman Jim McCrery, Louisiana Republican, is being pushed by House Speaker J. Dennis Hastert of Illinois and Majority Leader Tom DeLay of Texas as a politically risk-free way to give President Bush a key part of his plan that would allow workers to invest a portion of their payroll taxes in securities. […]

“Grow accounts take Republicans out of the weeds on Social Security,” said Larry Hunter, vice president and chief economist of the Free Enterprise Fund and an outside adviser to congressional Republicans on economic issues.

“It’s a very positive first step. The way the accounts are structured there’s no risk….” said Social Security analyst David John at the Heritage Foundation.

It’s as if these folks have completely given up on reality.

This entire approach to privatization would, by its sponsors own admission, make Social Security’s solvency issues considerably worse, add billions to the deficit, and wreak havoc on congressional budgeting (the trust-fund surplus currently finances the federal budget). It would also, necessarily, lead to benefit cuts for Social Security beneficiaries.

The House GOP, including the Speaker’s office, considers these details and believes a vote will help Republicans in the midterm elections, “inoculating” lawmakers from the controversy surrounding Bush’s unpopular plan approach.

If we’re really lucky, they won’t change their mind.

Post Script: And speaking of Republicans and Social Security, the right is getting less subtle in their opposition to the program’s very existence.

“The Cost of Freedom.” That’s Orwellian on so many levels. For one they assume that retirement security countervenes freedom. Eliminating retirement security is a ‘cost’ that makes us more free? I don’t think there’s really any logical connection there, even in their own minds. Rather I think there’s a great blog post to be made regarding the way that the right now tacks the word ‘freedom’ onto every inane proposal that crosses their mind. ‘Freedom walk,’ ‘freedom fries,’ ‘freedom isn’t free’ (as if the Iraq war automatically made us more free than we were pre-invasion), etc.

  • The Republicans are now calling these the what, growing account plans? I find it amazing that congress, and the president are being so fatherly with the American people. What this plan is, is a double whamey to the American people, excepting those older than 55. Congress has embezzeled from social security to pay for the proposals of the president. They know they have done this, and to make things right, they want all Americans less than 55,( which the vast majority of congress is not, and the president, and his cabinet are not,) to allow them to broker our money into growing accounts. What the hell kind of scam is this? The congress was never intended to be a brokerage firm, they are legaslatures, period. The president is not Karl Swabb. He is the top represenative of the American people, period. They also want to funnel people’s money who are less than 55 out of social security into Wall Street accounts, to help pay the costs of those comming up with this trillion dollar racket. The congress, senate, and any other government worker would be safe from this scam, because their money is quaranteed, however the American people’s money will not be backed by the federal government. . This is the same crap that was going on before the depression of the twenties. The government got the people to put their money into the stock market. They did. The stocks rose quite high, people were buying right and left, then suddenly the stocks, through manipulations of the robber barons, and multi million dollar bankers suddenly fell, causimng the destruction of the American economy. This Social Sedcurity is starting to look more and more like that. People lost homes, livelihoods, and land. Guess who confiscated those items? It was the robber barons. The energy corporations, war corporations, and the rest of our modern day robber barons, do not want you to make money in the stock markets, if they did, they would not be able to manipulate the prices. This is a scam to own every ounce of money in America. Look back into history, read how the federal reserve decides the intrest rates in favor of the mega corporations, lower rates means more buying of stocks by every day people, higher rates cause the seizure of small corporations by the corporations. Now they want the American people squeezed out too.. If this was such a brilliant idea, by the Bush nuts, then why wasn’t it written into law, when the stocks rose after the great depression? Social Security was a protection net from the Robber Barons. It was never intended to be used in their racketeering game.

  • The more they use “freedom”, and the more we see/hear it, the more we’re supposed to believe that we have it, when – in fact – we don’t. Just another of the psychological games they’re trying to play.

  • But does the left want to save S.S. as bad as the right very, very much wants to kill it? With the right holding so many levers of power at the moment, it’s not surprising that we’re still talking about this. But Sandy’s post is clear and easy to understand and….we’re still having this conversation. RepubCo is betting that the public’s mind hasn’t REALLY been poisoned against what they want.

    The Dem’s still strike me as being too confident that the vaunted “third railness” of this supposedly untouchable program is going to safeguard S.S. I haven’t heard the substance of RepubCo’s logic repeatedly attacked with the thoroughness of Sandy’s post.

    Supposedly, the Bushies are pow-wowing about this in Crawford and intend to hit it again hard when he re-emerges. His town hall meetings are ludicrous but is any similar effort being made on behalf of real truth and logic?

    For a subject too dangerous to tamper with, to my mind, they’re a lot farther down to road to darkening Social Security’s reputation and percieved usefullness than anyone would have imagined possible a few years ago.

    If the American public wasn’t so gullible and complacent right now I’d be more confident, but RepubCo has gotten away with a lot these last 6 years. It shouldn’t take so much effort to get people to see the light about what a foolish mistake letting this program disappear would be. This country has become proficient at supporting or ignoring policies that aren’t in it’s own best interest.

    I think it ain’t over yet more than we would like to believe.

  • Eh?? Didn’t the Prez get through telling us over and over again that the I.O.U.s in the trust fund were worthless pieces of paper? I seem to remember him appearing in W. Virginia at the site of the IOUs just to prove the point.

    And now all of a sudden those imaginary IOUs are the “magic bullet??”

    WTF?

  • here’s the link:

    http://www.newsmax.com/archives/articles/2005/4/5/210152.shtml

    PARKERSBURG, W.Va. — President Bush on Tuesday turned a government file cabinet in the hills of West Virginia into his Exhibit A for why Social Security needs urgent change.

    To dramatize Social Security’s future solvency problem, the president peered into the four-drawer ivory cabinet inside the Bureau of Public Debt office here along the Ohio River. In the second drawer was a white three-ring binder filled with pieces of paper providing physical evidence of $1.7 trillion in Treasury bonds that back Social Security benefits.

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