In a press conference last week, President Bush claimed that he would listen to "any good idea" for protecting Social Security. So I thought of a few ideas, but I doubt they will make their way into his hands or his policies. He’s already demonstrated that he simply ignores opinions that he disagrees with.
Could it be that Bush wants a large deficit to make public programs like Social Security seem less stable?
Before we get to my ideas, a little background. Bush believes that Social Security is in imminent fiscal crisis – well, at least it will be in 2042, as he admitted in the press conference. To prove this point, he uses conservative estimates developed by the Social Security Trustees based on forecasts that paint such a gloomy future for the economy that it would have to resemble some parts of the Great Depression in order to come true.
Ironically, if Bush’s team used the same data to make predictions about the deficit and the true cost of his tax cuts, honest Republicans would declare his 2006 budget proposal dead on arrival.
So let’s assume the picture isn’t as bad as he claims.
Bush then was kind enough, in the same press conference, to list some ideas he considered to be good enough to listen to: "indexing benefits to prices instead of wages; increasing the retirement age; create disincentives for early collection of Social Security benefits." In other words, back-door ways of cutting current and future benefits.
It might be possible to take his claim to be open to "any good idea" as a sign that he sees his privatization plan as doomed. But let’s not take that for granted. He still really regards "private accounts," turning workers’ payroll taxes over to investment bankers (like Merrill Lynch, Goldman Sachs, Morgan Stanley, and other big corporations that heavily financed his reelection campaign), as the best way for people to plan for retirement.
This idea, by all honest accounts, will extract $2 trillion from the Social Security system in a very short period of time and turn over almost $1 trillion in brokerage fees alone (not to be recouped by future retirees) to the same investment firms that backed his campaign. (You could say they invested a few million in the hopes of gaining $1 trillion. Not a bad gamble on their part.)
If Social Security isn’t facing a crisis for say 50 years, it would certainly be facing one right away if this privatization plan managed to pass.
The net result of Bush’s project would be large and immediate cuts ($300 to $600 monthly) in benefits for current retirees (note: Bush hasn’t ruled out benefit cuts as a "bad idea") and enormous insecurity for future retirees. Financial collapse in Argentina and growing poverty rates for retirees in Chile after implementing privatized systems are real dangers under Bush’s plan.
In addition to this, ordinary working people simply don’t trust Wall Street to take care of their financial futures. They have good reason to be skeptical. Since the late 1980s Wall Street’s track record is marred with corruption and ruin: savings and loans scandal, junk bonds, dot-com bubble, rampant Enron-style corporate corruption, real estate and housing speculation. Working people have lost their shirts over and over again.
Perhaps, because of this healthy skepticism the majority of people simply don’t buy Bush’s plan. Despite a heavy media blitz that has seen some of the worst displays of right-wing biased journalism by outlets like USA Today, ABC News, FOX, the Wall Street Journal, NBC, and even CBS that have simply not provided an even-handed criticism of Bush’s privatization scheme, people aren’t falling for it. Even with Bush on the campaign trail, pushing his plan on unsuspecting middle America, the majority of people are saying they can’t risk their futures on privatization.
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Since the media blitz and cross-country stumping, Bush’s approval numbers have again fallen under 50 percent and yesterday’s polls show that the majority of Americans reject Bush’s plan. Maybe if he had been honest about his plans for Social Security, some of those red states would have been blue last November.
Anyway, here are four basic and painless ideas for strengthening Social Security that I’m positive Bush won’t listen to:
1) Create more higher paying jobs.
Because Social Security is funded through payroll taxes (a percentage of workers’ wages), low unemployment and high wages logically mean that more money will flow into the system, ensuring its stability. A growth in manufacturing jobs and union protections would cause wages to rebound after years of stagnation. Under Bush’s watch 3 million high-paying manufacturing jobs have disappeared, and he has consistently attacked unions and blocked workers’ rights with a far-right controlled National Labor Relations Board.
Further, while the unemployment rate falls officially, record numbers of workers are leaving the workforce, more are "underutilized," and still more are working for lower wages. All of this means that the flow of resources into the Social Security system is shrinking.
Could it be that Bush wants this to happen and that his anti-Social Security ideology trumps his "compassion" for working people?
2) Adopt a tax policy that actually stimulates the economy.
Bush’s tax cut ideology has put hundreds of billions of dollars into the hands of the already wealthy and secure parts of the population. A real tax cut stimulus would aim the benefits at the working majority that actually consumes what is made in the economy and keeps it going. If working people can’t buy the things they need, the economy shuts down. It is pretty simple. Because the wealthiest people in the country cannot consume nearly as much as the working majority, it makes no sense to give them so much. Yet Bush 2006 budget proposal seeks to give the top 2 percent of the population 97 percent of a planned $1.6 trillion tax cut.
On top of this, Bush’s tax policy has turned a budget surplus into a massive $600 billion dollar deficit that strains all federal resources.
Could it be that Bush wants a large deficit to make public programs like Social Security seem less stable?
3) Invest in worker retraining and education.
It doesn’t take a rocket scientist to understand that investment in education and training is key for future workers to have the knowledge needed for economic development.
So why does Bush consistently gut education and worker training programs?
4) Stop spiraling medical care and prescription drug costs.
Medical and prescription drug costs are currently growing 5 or 6 times the rate of inflation. Ideally a national health care system would control – even reduce – costs by increasing the risk pool, eliminating the profit motive, and with manageable administrative costs (as opposed to the current maze of bloated corporate bureaucracies). Such a program would save tens of billions of dollars each year for public programs including Social Security.
No payroll tax increase (unless you’re ultra-rich). No benefit cuts. No lies and half-truths. No ideological agenda, except good paying jobs and investment in health care and education. If Bush wants good ideas, he needs to listen to working people rather than investment bankers and right-wing ideologues. But then again, we aren’t his base are we.
--Joel Wendland is managing editor of Political Affairs and can be reached at jwendland@politicalaffairs.net.
