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Copyright © 2005 Frank Lynch.

 

 

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Wednesday, February 9, 2005:

Is Bush laying the groundwork for his impeachment? It's been questioned by some who are smarter than I am whether or not Bush has plans to default on the bonds which are in the Social Security Trust Fund. (See Kevin Drum a few days ago, and today Josh Marshall.) But Josh raises a question in a later post today, that were Bush to default on the bonds, it would violate his oath office, specifically regarding "The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned." The next logical conclusion would be this: isn't violating the oath of office grounds for impeachment? (Josh didn't address it, but I bet the cogit flashed.)

(I'm also not sure why defaulting on the bonds is even an issue for Bush: the Trust Fund won't need to draw on the bonds until Bush is out of office.)

UPDATE: (Thursday, February 10) Al Franken is also looking at the impeachment line, only he thinks the impeachable offense has already occurred, because Bush has already questioned "the validity of the public debt" with his statement that "There is no trust."
Link | | 7:06 PM Home


Brit Hume should be thoroughly investigated. Media Matters for America has documented how Fox news anchor Britt Hume twisted the meaning of FDR's words to suggest that FDR believed in the eventual end of government's involvement in Social Security, when, in fact, FDR was merely talking about a time when the early retirees would be succeeded by generations who would have already contributed. FDR was most clearly not calling for privatization.

This is an outrageous distortion of FDR's meaning, and Hume should have known it. Either he twisted the words himself, or he committed an incredible lapse in his journalistic responsibilities by not looking at FDR's words for himself. They are not new, and they are easy to find, as they have been up on the Social Security Administration's web site since at least 1996. Here's the broader 1935 FDR quote (as shown on that 1996 page) from which Brit Hume excised his selectively distorted portion:

"In the important field of security for our old people, it seems necessary to adopt three principles: First, non-contributory old-age pensions for those who are now too old to build up their own insurance. It is, of course, clear that for perhaps thirty years to come funds will have to be provided by the States and the Federal Government to meet these pensions. Second, compulsory contributory annuities which in time will establish a self-supporting system for those now young and for future generations. Third, voluntary contributory annuities by which individual initiative can increase the annual amounts received in old age. It is proposed that the Federal Government assume one-half of the cost of the old-age pension plan, which ought ultimately to be supplanted by self-supporting annuity plans."

Where FDR is talking about "self-supporting annuity plans," he is not talking about private accounts, he is talking about the natural progression of the program as the initial tranche of government-funded retirees leave the system through their deaths — supplanting the original old-age pension plan (talked about in the first part of the quotation), that is, for those who started in the plan at a point where they were "now too old to build up their own insurance." This is not privatization.

Hume should know better. Fox should immediately investigate the process Hume went through to arrive at his distortions; Fox should also investigate who on Hume's staff was aware of this malignant effort to warp Social Security, and if Hume is found culpable he should be sentenced to Ratherland.

If you run (or contribute to) a blog, I urge you to consider a similar post.
Link | | 4:28 PM Home


A question for those assembled... Because I'm too busy myself right now and you may already recall having seen it... The "problem" with Social Security seems to be that starting in 2018 (or 2012, under Bush's basic plan) the Social Security Trust Fund will need to start tapping into its US Treasury Bonds, requiring the US government to start "paying up." But do they have to be redeemed by the US Government? Can't some of them be sold to bond buyers? (What share of the bonds it holds are at maturity in 2012/2018?)
Link | | 12:07 PM Home


The election is over, get over it. It's sad and funny at the same time, really. Handshakes over Israel and Palestine don't get mentioned, nor the budget, nor Social Security, but Horsefeathers is still going on about John Kerry's military record. Anyone want to cue a famous Knight Errant? (I mean, I know bloggers are entitled to their own focuses, but really, what those focuses say about us...)
Link | | 10:52 AM Home


A Happy New Year, to all of you of Asian descent who are celebrating, observing, taking note, or whatever...
Link | | 10:47 AM Home

Tuesday, February 8, 2005:

Further out on a lonely limb? I've exchanged some pleasant emails with David Hogberg as a result of his deflating rumors that federal employees (including those in Congress) don't pay into Social Security — which, if they weren't would make them susceptible to charges of hypocrisy. But proving that people aren't always predictable, yesterday he wrote a column in the Spectator which actually had more extreme rhetoric than that being used recently. That is, while Bush has not used the word "crisis" recently (and even explicitly walked back from it), Hogberg argued again for using the c-word. It raised chuckles from a number of people, including Kos , who, noting a conflict between Hogsberg's articulation and the President's, asked "So who is right, and who is wrong? This one is too easy to call."

You know, while it may be funny to remark on a columnist who's not in lockstep with the White House semantics, there's really no reason to. Bush has been frequently shown to be wrong, and complaints have even been lodged about the White House pushing for specific language. So if Hogsberg wants to argue for crisis, fine. I disagree with him, but he's welcome to, and I personally think that using language like that makes him sound even more extreme. And since this looks like it's breaking down to a battle of words, gentlemen, start your engines!

But I don't think Hogberg's defense that Bush is saying bankrupt is much of a defense. Bush is also saying "the entire system would be exhausted and bankrupt" by 2042 which is flat wrong, since the Social Security Trust Fund it should be able to pay over 70% of its scheduled benefits: Bush has said exhausted and bankrupt in the same sentence.

Personally, I think it's not a great idea to run to Bush's words for support. Bush will change his words to suit the occasion. If I were a pundit, I'd formulate an argument — carefully, no one wants to be caught in Juan Cole's crosshairs — and damn the torpedoes! I wouldn't rely on Bush.

UPDATE: Corrections have been made in response to a comment, and belated realization of what I should have written.
Link | | 10:54 PM Home


Secretary Rice calls for a new chapter. From the New York Times:

Secretary of State Condoleezza Rice, proclaiming that it was "time to open a new chapter in our relationship," called on France and Europe in general today to put aside past differences and embark on a joint effort to expand their relations in the Arab world, build a new Iraq and bring about peace in the Middle East.

See, we have to be clear when we call for that because the wrong guy got elected, and he and Rice seemed more than happy in 2003 to threaten all sorts of long-standing international relationships. If I were a foreign leader, I'd want to know in advance how far the United States wanted to push on Iran, and whether or not it was going to give the IAEA a decent chance. Of course, fool me once...
Link | | 6:21 PM Home


Better to remain silent. We don't know who said it, but someone, somewhere, once said "It is better to remain silent and be thought a fool than to open your mouth and remove all doubt." Reading Juan Cole's latest round against Jonah Goldberg, you really have to wonder what got the better of the common sense of Goldberg and his landlord. Goldberg is clearly a midget regarding knowledge of the Middle East compared to Cole; Goldberg is also unqualified to write about it at all, much less call Cole's informed conclusions into question.

Goldberg should have used restraint before sitting down at keyboard; his publisher should have said something like, "Jonah, even though I agree with you, what's your background on this?" Goldberg has made a clear argument, however, against the wisdom of salaried columnists: if they can't write with authority about something, don't. Call in someone who can.
Link | | 10:11 AM Home

Monday, February 7, 2005:

It's pretty clear why Bush backed off the highfalutin language about freedom and democracy in his Inaugural address: if we didn't allow nasty regimes to continue on, how else would we get our torture done for us?
Link | | 7:51 PM Home


Now, explain it to me like I'm a four-year-old. No, better not, give it your best shot, explain it to me like I'm an adult, OK, Mr. President?

Because the -- all which is on the table begins to address the big cost drivers. For example, how benefits are calculate, for example, is on the table; whether or not benefits rise based upon wage increases or price increases. There's a series of parts of the formula that are being considered. And when you couple that, those different cost drivers, affecting those -- changing those with personal accounts, the idea is to get what has been promised more likely to be -- or closer delivered to what has been promised.

Does that make any sense to you? It's kind of muddled. Look, there's a series of things that cause the -- like, for example, benefits are calculated based upon the increase of wages, as opposed to the increase of prices. Some have suggested that we calculate -- the benefits will rise based upon inflation, as opposed to wage increases. There is a reform that would help solve the red if that were put into effect. In other words, how fast benefits grow, how fast the promised benefits grow, if those -- if that growth is affected, it will help on the red.

Okay, better? I'll keep working on it.

This is, of course, The Leader of the Free World.
Link | | 6:51 PM Home


Banking on the Social Security Trust is just blather? That's what David Frum thinks; he thinks the bonds it holds are worthless IOU's because they come from the government itself, and the government can easily forget about debt it owes itself: "If Fred writes an IOU for $10 to Jim, Jim has an asset. But if Fred writes an IOU to Fred for $10, he has not created an asset for himself — he's created a reminder notice," writes Frum.

Nice rhetorical twist — except that it's more like Fred has written an IOU to his brother, and if he shafts his brother word will get out and Fred will have trouble floating IOUs elsewhere. Meaning, if the US chose to default on its bonds, investors around the world will take notice. There will be higher risk associated with our bonds and interest rates will rise to accommodate the risk. You think Greenspan would let Bush get away with that?

Really, its as if Frum thinks the U.S. lives in a vacuum or something, its own little closed system. The Trust Fund is most certainly not a "hoax," as Herman Cain and others of his ilk would have you believe.
Link | | 6:28 PM Home


Just a little housekeeping: I need to make sure you're aware of a great resource on Social Security.
Link | | 3:52 PM Home


What's a theocracy? Do you need men or women of the cloth (any cloth) actually in official government positions as a necessary condition? It's relevant, because the White House is playing down concerns that a theocracy is being established in Iraq. According to the New York Times,

Administration officials acknowledged that they would have much less influence over a transitional Iraqi government selected by the newly elected assembly, but were relying in part on Ayatollah Sistani's stature to steer Iraq clear of a government led by clerics.

"If you're looking for guidance in terms of what the relationship is likely to be between the religious faith, Islam, and the secular side of the house, the government, you really need to look at the top cleric, Sistani," Mr. Cheney said. "He also has been very clear, from the very beginning, that he did not want to play a direct role and doesn't believe clerics should play a direct role in the day-to-day operations of government."

Yet the clerics clearly want to influence the leaders. For Cheney et al, the paper walls are sufficient to say it's not a theocracy. In fact, it's important to them to keep pointing to those paper walls not just because of foreign policy, but also because of domestic policy. Remember, during the election Bush solicited the Pope for help against John Kerry, seeing an opportunity to use abortion as a wedge between Kerry and Roman Catholic voters. It's all part and parcel of an administration that works to stop PBS from running a film of a cartoon bunny visiting a Lesbian couple in Vermont — it's not like they were having sex or anything, they were just being people.

The Administration cannot have people thinking about the definition of a theocracy, because then people might start to think that we're headed by one also.
Link | | 9:19 AM Home


Bush plans to raise taxes. That's the only logical conclusion that results from Social Security plans which will increase the national debt by trillions. The bills have to be paid, and the money has to come from somewhere, right? And on top of that, since it won't be enough to fix Social Security's shortfalls, he plans to cut benefits.

No doubt about it, privatization makes sense to me...

And it's disingenuous to point to the remarks of a few Democrats without acknowledging the full implications of Bush's plan on tax burdens, too.
Link | | 8:21 AM Home

Sunday, February 6, 2005:

An addition to the links on the left. Well, left in terms of the page, I have no idea about the politics. But there are some great shots at Sparkle. I'm entranced.
Link | | 8:42 PM Home


Our Super Bowl Halftime Show! Just so you know, football isn't mentioned in the Bible, but baseball is. Yup! Right there at Genesis 1:1. "In the Big Inning..."
Link | | 8:08 PM Home


Giving Credit Where Credit Is Due Department. Ever since that law perfesser at that university what wears Orange and White highlighted the web site Social Security Choice, I've been watching it fairly closely, responding to a number of their posts and seeing them respond to me. While it's not at all like an open debate between diverse teams of those who are pro-privatization and those who are not, there has been a reasonable back and forth. And no "your mother's" have been exchanged, either. But I just want to point out a post from David Hogberg, who went the extra mile to actually deflate a contentious rumor which, if true, would have added fuel to pro-privatization arguments. So, a hat's off. (For what it's worth, this contentious rumor — that the Congress and federal employees can escape Social Security contributions if they participate in their special savings plan — was subject of one of my posts a week ago.)
Link | | 6:06 PM Home


It may not have been due to global warming, but then again it might. The weather this weekend has been surprisingly warm, and it took an extra effort to dress for the occasion. I didn't take that effort, and for much of my walking in Manhattan today I found myself carrying my coat, rather than wearing it. Even setting it down on the sidewalk while I took pictures of surrounding buildings. For much of my walk (from 23rd Street down to Canal) the sun was in my face, and it was real work to get decent photos. But then I realized I needed to look at the sun not as an obstacle but an opportunity. On Fifth Avenue I caught some yellow plastic barracades, whose translucence and shadows worked out nicely; fire escapes on the east side of Crosby Street in Soho reflected the sun so brightly it was as if they wanted to jump off the buildings. From a photography standpoint, it was very much like the Stephen Stills song: "if you can't be with the one you love, then love the one you're with."
Link | | 5:52 PM Home


Cheney is in the "not yet" camp when it comes to concerns over the kind of government which might be established in Iraq. Appearing on Fox, he probably felt a need to reassure the audience of the confused which voted for Bush. In a sense, he's right to say that the Islamic influence and unequal rights for women isn't a done deal. But then, if it wasn't a done deal, we shouldn't look to Cheney for an accurate prognosis: for a long time, he was saying things like "we just don't know" to Tim Russert about alleged connections between Iraq and 9/11 that had already been debunked. So I'm just saying.
Link | | 5:39 PM Home


I wonder if the right wing's glee from last week over the election in Iraq will be sustained, now that it looks like a religion few of them practice (Islam) will be enshrined in the Iraqi constitution? There may be some comfort in the phrase "not yet," but there has to be a recognition that a process is different from a result. Last Sunday's election was both process and result, but the results didn't end with Sunday's process.

To be fair, I was glad about last week's elections, too, but I don't think glee characterizes my reaction.
Link | | 9:16 AM Home

Saturday, February 5, 2005:

Writer's alert. Writing is not easy, and I don't think consistently writing well is easy for anyone. Good writers not only write, they edit. They may not edit as they write, but they should certainly do so afterwards. And in the process of editing, if something sticks out like a sore thumb, they should attend to it. For instance, Nicholas Kristof's column today. It's all about how Democrats who oppose Social Security privatization should be willing to compromise with the President, and how stonewalling is a mistake. But then, in the middle of the column, Kristof writes,

True, there is one powerful objection to private Social Security accounts: We can't afford them now. Mr. Bush's plan would cost $1 trillion in its first decade and $3.5 trillion more in its second decade. Financing this with debt — an Argentinian approach — would be utterly reckless.

So there's this heaping objection which Kristof acknowledges supports arguments against privatization. Does this stop Kristof from getting behind privatization, or chastising Democrats? No. He blithely suggests tax increases, something the President would never consider.

A writer who offers a thesis-crumbling point like that one really needs to start his column over, from a different point of view. Instead of arguing that Democrats are obstructionist, the point of view should have been more along the lines of "do Democrats have legitimate complaints?"
Link | | 4:45 PM Home


I think Juan Cole is angry. At Jonah Goldberg. This is a really great smackdown, well worth reading.
Link | | 10:08 AM Home


Bush hasn't cut taxes. This is an interesting way to reframe Bush's claim that he's cut taxes. Bush hasn't really cut taxes because the budget still has to be paid for; Bush has merely shifted the tax burden lower and later. Bush can't claim to have cut taxes until he cuts the budget. (This is similar to the way I put it in one of my Ten Questions For President Bush from last April, where my lead question was "At a time of increased federal deficits, why do you continue to refer to the checks some Americans received from the IRS as 'tax cuts' instead of 'money stolen from future generations'?") (Via Hilzoy at Obisidian Wings.)
Link | | 9:53 AM Home


That Liberal Media. The New York Times killed an article seriously discussing Bush's bulge, for fear it might influence the election. This is the impact of the incessant carping that there's a liberal bias in the media: Bush cheats in the debates, confident that he could get away with it, and the Newspaper of Record is too timid to push the button on their story. (Via Will via Suburban Guerilla via Digby.)
Link | | 9:33 AM Home


This is like shooting fish in a barrel. Yesterday's lead post was about an over-the-top cartoon posted by Kerry Kerstetter at Social Security Choice. I'm about to post about another of his chosen cartoons, but before I do so, shall we ask the big question? I mean, who is Kerry Kerstetter? Here's the bio at Social Security Choice:

Kerry Kerstetter

Kerry Kerstetter is a CPA who has been in the trenches helping real people understand and utilize the tax system for 30 years to minimize the income and Social Security taxes they pay in, while maximizing the Social Security benefits they receive.

So let's be clear about this, unlike other CPA's, Kerry Kerstetter has clients who are "real people." Unlike your accountant, who has a client portfolio consisting of robots, alien monsters, dust bunnies, amoebas, and perhaps even a stray meerkat. But not Kerry Kerstetter (no sirree bob!), who helps real people.

Wait, I'm being unfair: Kerstetter's client portfolio could actually be diverse, covering all of the above; that is, we know he has "real people" for clients, but perhaps fakes, too. (Kerry, can you clarify in the comments? Thanks.)

Now, for the latest wrong cartoon. Here. The cartoon asserts that Social Security "runs out" in 13 years. This is wrong. And if Kerry Kerstetter doesn't know better, I'm going to have to email Brad Delong about his "stupidest man alive" rankings. Social Security doesn't "run out" in 13 years. Far from it. What happens in 13 years is that pay outs exceed revenues, and according to plan, it starts drawing on its Trust Fund. It's been saving up for this, it has reserves, it's not "running out." It's like when you notice you're running low on canned peaches and you go down into the cellar to get a jar or so that you canned this summer or the last. That's all. If Kerstetter really believes Social Security "runs out" in 13 years, he's stupid. And if he doesn't believe it, he's lying to post this cartoon. He is, after all, a CPA, who deals with real people. Although perhaps his alien monster clients have turned his mind to mush with one of those zapper things. End of story.

You know, I'm going to have to flat out say this explicitly, because Kerstetter doesn't get it: America deserves better than the crap that Kerstetter is posting. And for him to continue doing so doesn't work in the best interests of anybody.
Link | | 12:37 AM Home

Friday, February 4, 2005:

Pinch me. Since the President (er, the Executive) is only one branch of the government, and there are checks and balances — in this case, Presidential vetoes can be overridden by a two-thirds vote — can someone tell me why payroll tax increases are really off the table? Just 'cos he says so doesn't make it so. There are already 44, 45 Democratic senators lined up against privatization. What's more likely, the passing of privatization reforms, or getting some Republicans to agree to an increase in payroll tax? (Dear Mr. President, please find enclosed one copy of the U.S. Constitution. Since you recently swore to uphold it, I thought this copy might come in handy...)
Link | | 11:43 PM Home


Why didn't this happen before the GOP convention? Being the neighborly sort, I was glad the GOP chose NYC for their 2004 convention (though not thrilled with the kajillion mentions of 9/11); still, I think it would have been a little more interesting if this judicial decision had been handed down a couple months beforehand. Can't win 'em all, I guess.
Link | | 11:24 PM Home


Mind the deceptive phrasing. In a critique of E.J. Dionne's column in the Washington Post, Ramesh Ponnuru at NRO's "The Corner" writes, "The basic point of the column is to minimize the fiscal problem. He does this chiefly by ignoring the $5.8 trillion the government will have to come up with to pay for benefits between 2018 and 2042."

Wrong, Ramesh: the government has to come up with money to cover the bonds its sold to the Social Security Trust Fund, just like it perpetually has to come up with money to pay back investors all around the world. There's nothing special about Social Security in this regard. The U.S. government has to come up with money for its past deficit spending, not Social Security.

This is not a point of mere semantics: it's not a burden for Social Security to pay its benefits. It may be a burden for the US government to cover its loans, but well, we should have listened more to Clinton in 1998. Don't blame Social Security for this.
Link | | 7:48 PM Home


Wall Street must be very disappointed. The January jobs report is out, and it failed to meet Wall Street's expectations. Like December's. And like November's. And while November's numbers were revised up in December, they were still too low; October's were strong but revised down when the November report came out, and September's were also disappointing.

Atrios is practicing the prejudice of lowered expectations by noting that Bush narrowly escaped a net job loss for his term, but let's remember, the 2004 job production falls short even of Bush's own forecast issued this past February. Note what I wrote in December:

After September's numbers, it was clear that in order to meet that figure we would need about 400,000 new jobs per month for each of the last three months of the year. It ain't happening, and since that projection was made well after the 2001 recession and 9/11, it's impossible to blame the shortfall on those events: the shortfall is due to unrealistic expectations by the White House.

Who here wants to believe him about economic growth for the next 75 years, when he can't even get the near term right?
Link | | 6:15 PM Home


What we can learn from the use of the word "crisis." Use of the word crisis to describe what Social Security faces in the future has dropped precipitously. And given that privatization is starting to have the attributes of a fetid corpse, let's start off with a quick review of some basics before we examine the semantics.

  • In his State of the Union address, the President said that funds invested in a private account would grow faster than anything the current system has to offer. He's promising future performance, and if he were a stock broker or a fund prospectus, he'd be hearing from the SEC for having broken the law. The financial industry is expressly forbidden from such statements, yet that's what the President claimed.
     
  • Privatization will not cure what ails Social Security, no matter how minor or severe the language you use to describe its currently projected fund shortfalls.
     
  • "Rescuing" Social Security from these shortfalls could be done in a variety of ways. The President is focused on eventually cutting benefits for those who are under age 55. The only remedy he has ruled out is in any increase in the payroll tax, through either an increased percentage or increased cap (the threshold beyond which payroll taxes are no longer taken out.)
     
  • Since there is no demonstrable benefit to moving to a privatized system, why is urgency being placed on this aspect? What is the President genuinely trying to achieve?

I doubt that the President will be able to persuade us ever again of what his genuine motives are, not since that screw-up in getting us into Iraq — not just because he got us in, but that it could have been averted easily by giving the inspectors the extra time they wanted, and that his rationale for the war has constantly shifted. There's just not a lot of reason to trust him when it comes to motives.

But let's look into the White House web site at the progress in language. I'm not going to be very thorough here, because there are others who have more time and actually make money for blogging, but let's look at Scott McClellan's briefing for January 6. The significance of this is that, if you use the site's search engine for "crisis," and order by date, this was the last occasion in which the word crisis was used by the WH to describe Social Security's situation. McClellan used the word more than once, but look at this section:

Social Security is in a crisis situation. We need to work now to strengthen it and fix it for future generations. We want our children and grandchildren to be able to realize the benefits of their own retirement savings. And we want them to have the best possible system and realize the greatest possible return on their retirement savings and have some ownership in the system, as well. Those are important principles that the President outlined.

We have a unique opportunity to seize this year. The American people just spoke in an election, and they made it very clear the priorities that they support. The Social Security -- strengthening Social Security was a central part of the President's campaign; reforming the tax code was a central part of the President's campaign. And now it's time for members of Congress to move forward on these priorities, and we're going to work very closely with them as we do and in a bipartisan way. That's what the President wants to do.

Note the reference to "a unique opportunity": that language alone undercuts the urgency of the situation, because if it were truly urgent the Congress would realize it and act no matter who was in the White House or controlled the various branches of government.

Also if I may add, the "unique" opportunity was under Clinton, when we weren't running a budget deficit; in 1998 Clinton wanted to put money from the surplus into Social Security, but was frustrated by Republicans, who he said wanted to raid the surpluses instead of strengthening Social Security. See here, where he said,

Social Security has been a cornerstone of our society for the last six decades, but the present system is not sustainable as we look forward to the full retirement of the baby boom generation. We have to protect it for the 21st century.

I was deeply heartened after I spoke about this at the State of the Union, that there were broad public statements of support from the leaders of both parties in both Houses in Congress about saving Social Security first. However, in recent weeks, senior Republican leaders in the House of Representatives seemed to have retreated from that pledge. In this election year, some now want to raid this surplus for initiatives instead of preserving every penny of the surplus until we strengthen Social Security.

We cannot ignore the long-term challenge, which we have a unique opportunity and responsibility to meet now, in favor of short-term schemes that, however popular in the moment, could compromise our future.

Let me be clear: I will oppose any budget that fails to set aside the surpluses until we have strengthened Social Security for the 21st century. Let me also be clear that does not mean that in the future there could never be a tax cut. It simply means that we need to know how we're going to pay for the challenges of reforming Social Security. Once we know that -- and we should know that sometime next -- I would hope early next year because of the work being done this year -- then we can have a debate about what ought to be done if there are funds that still are unaccounted for and unobligated.

So Clinton was being the fiscal conservative, insisting that the government's obligations to the Social Security Trust Fund be paid interest in shoring up Social Security be attended to. How very different from Bush, who in a time of budget deficits, added to the Government's red ink through tax cuts.

So let's go back to the phrase "unique opportunity." This is not about improving the Social Security or the country, this is about "because I can." Remember how he said he'd earned political capital as result of the election and he intended to use it? Whether or not you agree that he had a mandate (I don't), given the limited impact of what privatization will do for the country in anything close to a positive sense, it's difficult to look at this initiative as being anything more than swagger and payback. (That same McClellan press briefing, by the way discusses an internal memo which discussed the political opportunities which reforming Social Security meant in terms of the relative powers of the Republican and Democratic parties.)

For many of you this is all only a reminder. But at a point when we're scratching our heads and asking "why is he doing this?" (even some Republicans are asking) perhaps a reminder will be helpful in shaping the argument.

PS: even index funds wouldn't have handled the Internet bubble so well, just to remind you.
Link | | 4:32 PM Home


Pay attention to the disconnected arguments. The Club For Growth's lobbying affiliate is releasing an ad promoting privatization. That's fine, they're welcome to. And the ad reassures current retirees and boomers that there will be no changes to their benefits. That's also fine. But for those younger the ad states:

But younger workers will pay hundreds of thousands into Social Security. Without reform, they'll get just a fraction back when they retire. Personal savings accounts will give their generation the opportunity to save for a secure retirement: something to own and give to their children. Tell [insert legislator] to support personal savings accounts.

You can see the ad here.

A couple things to point out: one, they shift from shortfalls in benefits under the current plan to privatization without any mention that Bush's plan calls for benefits cuts as it is, even with privatization. That is, they change the subject entirely when they move to discussing private accounts. (See this post regarding how you're expected to do better under current Social Security than under Bush's plan.) Secondly, I don't believe Bush's plan will allow you to pass your privatized account onto your children. Unless I'm wrong, you buy an annuity with the funds you've accumulated at retirement, and you forfeit the balance when you die. Am I wrong? I'll certainly correct the record if I'm wrong, but this is a deceptive ad.
Link | | 12:00 PM Home


I find this strange. Miami is a big market for retirees, yet there's no mention of Social Security on the home page of the Miami Herald — nothing, not veiled, no Bush, no reforms, nothing. Maybe they think they covered it all yesterday? Maybe they don't think that those who are concerned read them online? I find it odd. (Nothing on the home page of The Palm Beach Post, either, nor on the pdf of today's front page.) And Bush is visiting the state today!
Link | | 11:42 AM Home


Bush's pals. More on how Enron provoked the rolling blackouts in California, from the New York Times:

"This is going to be a word-of-mouth kind of thing," Mr. Williams says on the tape. "We want you guys to get a little creative and come up with a reason to go down." After agreeing to take the plant down, the Nevada official questioned the reason. "O.K., so we're just coming down for some maintenance, like a forced outage type of thing?" Rich asks. "And that's cool?"

"Hopefully," Mr. Williams says, before both men laugh.

The next day, Jan. 17, 2001, as the plant was taken out of service, the State of California called a power emergency, and rolling blackouts hit up to a half-million consumers, according to daily logs of the western power grid.

Officials with the Snohomish County Public Utility District in Washington State, which released the tapes, said they believed Enron officials had taken similar measures with other power plants. This tape, they said, was proof of what was going on.

At the time, power plants in the greater West Coast grid were under a federal emergency order to keep their plants running.

Since the courts won't compel Cheney to open up his files on his energy panel (wasn't it clever to have that energy panel headed up by a VP, who could then wrap himself up in the idea of White House confidentiality?), and since Cheney has no interest in opening them up otherwise, I'd say this is good reason to hold up the energy plan whose delays Bush griped up about the other night, wouldn't you? I mean, all in the interests of government transparency.
Link | | 10:06 AM Home


Well, this rhetoric is ratcheting up nicely. So now the Democrats are being compared to insurgents. I'm sorry, but when you show a cartoon like this without commentary, you're suggesting you endorse the view; and comparing Democrats who disagree with you over Social Security to insurgents is waaaay over the top. Maybe Kerry Kerstetter hasn't heard, but our troops are dying at the hands of insurgents. Rather than post this cartoon without comment, it should be shown and spat on.

UPDATE: Over at Daily Kos, a comment has been made that the privatization camp has made another mistake by reminding us of Iraq: "Linking the administration's plans for Social Security reform with the botched Iraqi reconstruction effort is an argument that can't be heard enough."

UPDATE 2: Kerry Kerstetter responds, sort of, but still doesn't seem to be cognizant that the cartoon he published was over the top. You publish it, you own it. If you don't think it's over the top to compare those you disagree with to the insurgents, perhaps some time with families of the fallen will help. If you do think it's over the top and publish it anyway, then you've lowered yourself.
Link | | 9:01 AM Home

Thursday, February 3, 2005:

You'd be better off if you left Social Security as is? So Bush & Co has said that privatization won't resolve funding issues for Social Security. Apparently you'll be worse off under the Bush plan than under Social Security as is. More here and here. You can also read about it in the extract I posted from the Roger Lowenstein article which posted here; the plan that the President spoke about last night is basically the same one which the CBO analyzed and Lowenstein wrote about. (If the privatizers want to argue against this, fine, we entertain all arguments. We still wish they'd all sit down together and hash it out on TV: it's just as important as a presidential debate.)
Link | | 9:43 PM Home


Solutions that don't solve. If you haven't heard (you can read about it over at Talking Points Memo), the Bush Administration is backing off claims that privatization will help the fiscal health of Social Security. This is a point made a few Sunday's ago in the New York Times Magazine, in an article by Roger Lowenstein. He pointed out that Bush & Co. had only one plan analyzed, and in it, savings resulted not from privatization but from benefits cuts. (My write up, with extracts, is here.)

The argument is now reduced to political philosophy about what the program should be, and whether a shift in the program will benefit its participants. It has little or nothing to do with the fear appeals used to get your attention. This is very much like the bait-and-switch used on the rationalization for invading Iraq. As you know, the emphasis started out as WMDs and the new post-9/11 world, with the suggestion to Americans that Saddam Hussein was behind 9/11; it morphed into humanitarian, and now seems to be about planting democracy.
Link | | 5:05 PM Home


How the White House invents news. If you have a very friendly reporter to steer the conversation away, it's easy.
Link | | 9:26 AM Home


Oh my, Donald Luskin says I'm anti-reform. In response to an earlier post of mine, Donald Luskin refers to me as "an anti-reform blogger."

This is a mischaracterization of my positions. I have never said I'm against reform; I haven't even said privatization is wrong, I just remain skeptical of it. I'd like to see something like the old College Bowl game show, where a team from the pro- privatization camp debates a team from the anti-privatization camp. All together on the same page, responding to each other's arguments in real time. And from teams, not Luskin v. Krugman. But Luskin's own blog (as well as Social Security Choice) doesn't allow comments from readers, so clearly they aren't promoting dialog.

Truth be known, I'm in favor of fixing Social Security and have said so several times. But because I don't see it Luskin's way, he sees me as being "anti-reform." That's like the false choice which hawks created over Iraq: anyone who wanted to give the inspectors more time were tarred as wanting to give the inspectors forever, and free reign to Saddam. Well, we were right about Saddam Hussein, and the hawks were wrong. Are we going to wake up with a similar feeling about privatization?

And as for Luskin's other point, that it really doesn't matter where you start the 75 year period, I can accept that. But as one of my commenters reminded, securities laws prohibit anyone talking about future performance on the basis of past performance; you can't logically extrapolate from the past.
Link | | 9:15 AM Home


His finest speech since just after 9/11? Bush gets rave reviews from Carrie Lukas over at Social Security Choice:

In my opinion, this was the finest speech the President has given since the one he gave before the joint session of Congress the week after 9/11. The President made the case for Social Security reform and for personal accounts as well as anyone I have ever heard.

I was thrilled with his matter-of-fact discussion about what must be on the table a serious discussion of changes to benefits to bring the costs of Social Security under control. And as David Hogberg pointed out, that payroll tax rate increases were left off the table.

I understand that Senator Ried has called President Bush's Social Security plan "dangerous" during his speech. How wonderful that the President has just pointed out that Senator Ried and all other members of Congress are themselves already participating in such a plan!

I actually think the October 2002 speech in Cincinnati was far better; even though we now know that much of it was bluster, Bush clearly laid out his rationale for addressing Saddam Hussein, pinning it on what he described not as a single issue of humanitarian abuse, terrorism, or WMD, but the combination of them in one regime. The rhetoric, too, was far more riveting: "we cannot wait for the final proof — the smoking gun — that could come in the form of a mushroom cloud." He also supported his claims with enough details to make you shiver.

Last night's speech, however, left you scratching your head when it came to Social Security. He fudged on some details, suggesting that the growth in the number of retirees was unforeseen by those who set the program up, for instance. He also claimed that in 2042 the system will be "exhausted and bankrupt." You can justify "bankrupt" if it can't meet all its obligations, but if it can meet 80% of them "exhausted" is a lie. That, I think, is the big difference between the 2005 SOTU and 2002 Cincinnati: in each case he wasn't telling the truth, but in Cincinnati we didn't know. Last night he peddled a lot of the same lies that have already been dispensed with.

There is also the issue of audience reaction. In Cincinnati, Bush had the advantage of a partisan audience; much of last night's audience knew to wail in disbelief at some of what the President was saying, diminishing its impact.

So I certainly disagree with Lukas on the relative quality of the speech. Another question I have is over Lukas' appreciating the President's remark over Senators having the same program he's proposing. Isn't the TSP which the President was talking about in addition to Social Security as we know it? Anyone?
Link | | 8:56 AM Home

Wednesday, February 2, 2005:

In the midst of democracy in Iraq, in itself a good thing, the American nation may not feel the same: for the first time in a decade, the Marines missed their January recruitment goal. Let's not go crazy over this, but perhaps it's an "early indicator," and let's watch it.
Link | | 11:59 PM Home


Everything is on the table regarding Social Security? The President listed many alternative adjustments to Social Security, saying he wanted one change that would make the program self-sufficient forever. But he really said everything was on the table. Will this be like his saying he would give inspections in Iraq a chance to work, only to cut them off with an artificial deadline of "time is running out"? Have I just identified yet another parallel with the selling of the war in Iraq?
Link | | 11:21 PM Home


Culture of life. I was glad to hear the President embrace an appreciation of life tonight: there are too many abortions in the country, and I hope the President can expand educational programs which will help the underprepared take adequate precautions that One Night Of Sin doesn't lead to an unwanted pregnancy. But I was surprised (actually, not) that capital punishment wasn't part of this discussion. After all, the Pope wrote a long encyclical on life drawing attention to limiting capital punishment as part of a comprehensive appreciation for life; and what with Bush having gone to the Pope to plea for Catholic support against John Kerry (who favors keeping abortion laws as they are), and what with the Pope being in the hospital, I really thought that Bush would have been more cognizant of what the word "life" means. But perhaps I quibble.
Link | | 11:21 PM Home


Frivolous asbestos claims. For a long time, eliminating frivolous asbestos claims was just a dream, until the President mentioned it in tonight's State of the Union address; it may still be a dream, but used car salespeople (if you click the link, that's what "aftermarket" means) can rest assured that their dreams may become a reality. How about African-Americans, who just last week the President claimed don't get a fair deal in Social Security because they die earlier? Sorry, the President wants to change Social Security. No mention of new health initiatives to help you out. Too bad you're not selling used cars with questionable asbestos.
Link | | 10:44 PM Home


Semantics debate? I just heard Tim Russert say that there's a semantics debate going on over whether reformed Social Security accounts would be "private" or "personal." Let's be clear, it's not a semantics debate, it's a word choice debate. We all know what the words mean. And privatization captures it. If there's a debate, it's between the President and the populace over what the word privatization means. He was capable of making American think Saddam Hussein was behind 9/11, he ought to be able to tell them what he really means by the word privatization. Leave the language alone.
Link | | 9:13 PM PM Home


The historical growth of the stock market. In an effort to refute Paul Krugman, one of Donald Luskin's arguments is this:

Even without the arithmetic, there's nothing so unusual about thinking that stocks could return something like 6.5 percent, after inflation, over the next 75 years. After all, they've returned exactly that over the last 75 years, according to Ibbotson Associates.

Let's say that's so, for argument. Let's also say, for argument, that we're in calendar year 2005 (the beginning, or thereabouts). 2005 minus 75 equals, what, 1930? (Can somebody check my math for me?) Can anyone figure out a reason why starting a comparison of stock market growth in 1930 might be a bit misleading? October, 1929, anyone?
Link | | 4:27 PM Home


A privatizer comes clean. Over at Social Security Choice, Louis Woodhill openly states that he wants to take Social Security away from the Democrats as a political issue. He's OK with increasing the deficit to increase benefits on Social Security, just to shut Democrats up. How much do they really care about Social Security?
Link | | 3:56 PM Home


The Iraq-Social Security parallels keep coming. I mean, not that the issues themselves are similar, but the way that Bush & Co. have campaigned to have them addressed. African Americans, it seems, are the Social Security equivalent of Abu Musab al Zarqawi.

How so? Well, you'll recall that one of the arguments for invading Iraq was that Saddam Hussein was harboring al Zarqawi. Said Colin Powell in his (hah!) Adlai Stevenson Moment at the UN Security Council,

But what I want to bring to your attention today is the potentially much more sinister nexus between Iraq and the al-Qaida terrorist network, a nexus that combines classic terrorist organizations and modern methods of murder. Iraq today harbors a deadly terrorist network headed by Abu Musab al-Zarqawi an associate and collaborator of Usama bin Laden and his al-Qaida lieutenants.

Zarqawi, Palestinian born in Jordan, fought in the Afghan war more than a decade ago. Returning to Afghanistan in 2000, he oversaw a terrorist training camp. One of his specialties, and one of the specialties of this camp, is poisons.

When our coalition ousted the Taliban, the Zarqawi network helped establish another poison and explosive training center camp, and this camp is located in northeastern Iraq. You see a picture of this camp.

The network is teaching its operatives how to produce ricin and other poisons. Let me remind you how ricin works. Less than a pinch -- imagine a pinch of salt -- less than a pinch of ricin, eating just this amount in your food, would cause shock, followed by circulatory failure. Death comes within 72 hours and there is no antidote. There is no cure. It is fatal.

Powell would invoke Zarqawi's name 21 times in his presentation. Musta been a serious dude, well worth taking out; and the ensuing history of our engagement has shown his formidability, and what a danger he's been to our troops.

Except, that rather than deal with Zarqawi and the danger he represented, the White House chose to keep him as card in their hand to justify war against Iraq. And in Bob Woodward's Plan of Attack (pages 300-301) you can read about the background disucssions they had over whether or not Saddam Hussein was really "harboring" someone in an area where he (Hussein) had no control, with Cheney's chief of staff arguing that his mere presence counted for harboring.

So here you have an Administration not doing all it could to remedy a problem, and instead leveraging that problem to fulfill a bigger goal.

As for African-Americans, last week Bush talked about the lower life expectancies of African Americans, and argued that they receive a worse "deal" from Social Security as a result; therefore we should change Social Security. (Bush's arguments have been refuted.) But did Bush say anything about programs to improve the life expectancy of African-Americans? No. Why would he do that, when he wants to argue for changing Social Security instead?

Don't listen to tonight's State of the Union address with expectations that you'll hear anything about new health programs targeting African-Americans. They didn't target al Zarqawi when they could have, either.
Link | | 10:54 AM Home


"Where there is yet shame, there may in time be virtue." (Johnson) Well, it's not looking good for reform in the Bush White House, not when you've got Senators like John Cornyn being quoted as saying about the delayed vote on the Gonzales nomination, "They want [...] to try to taint this nominee with the perceived sins of the Bush administration." Got that? Perceived sins, no acceptance that torture is wrong or that Bush and Gonzales were complicit in attempts to move the bar on what constitutes torture, allowing for more and more egregious treatment of prisoners. They still don't see how this attitude endangers our troops, since the Geneva Conventions require reciprocity. But hey, whatever. All for the good of the GOP, you know? (How many Republican senators will show their statesmanship and vote to reject Gonzales?)
Link | | 10:20 AM Home


So glad I don't have the time to blog about EVERYthing. If I blogged about every alarm, then a few weeks ago I'd have been raving about the NYC subway fire that knocked out an entire local line and struck an express line down to one-third its normal capacity, and how it was going to take 3- 5 years to restore it, and the impact it was going to have not just on New Yorkers but on New Jersey commuters who come in on a bus over the George Washington Bridge. But I didn't, I was too busy. But then a few days later when the original timeline was brought back to a matter of months, I said, you know, I should write about how quickly things change and how sometimes it makes sense to hold your opinion back. But I didn't, I was too busy. And so now, today, that local line that was supposed to take years, then months, is actually working as of today.

The moral of the story remains: don't blog everything.
Link | | 10:01 AM Home

Tuesday, February 1, 2005:

So the CIA has put the final nail in the coffin, and officially concluded that Saddam Hussein hasn't had any chemical weapons since 1991. Not 'till just before the war, but since 1991. Keep in mind that a majority of Americans has concluded that the war in Iraq wasn't worth it. That may be moderated as a result of the recent Iraqi elections, but I can't imagine any grosser negligence from a President than sending his country to an unnecessary war. Bush's refusal to let the inspectors have more time under his artificial "time is running out" deadline has cost us too many lives and led to too many crippling injuries, as well as too huge a debt burden.

We sure did get us a war president, didn't we? What the hell was this exercise all about, some kind of compensation for an inferiority complex?

I want to know, I really want to know how he was being advised: who was feeding him the "now or never" garbage, the "we can't turn all these ships around"? (Hat tip to Kevin Drum.)
Link | | 1:16 PM Home


A belated welcome to those of you coming from Tom Tomorrow's "This Modern World" blog. Enjoy the photos, enjoy the political posts, but please check out my Samuel Johnson site, within which this blog resides. (If you don't know who Samuel Johnson was, he lived in the 18th century, wrote something like 400 essays, a Dictionary, literary criticism, and has been looked to by both liberals and conservatives.) Seriously, it's the assemblage of nearly 2,000 Johnson quotes that I'm really proud of. So set a spell, and find your bookmark button!
Link | | 9:23 AM Home


Oh pish posh: Paul Krugman's reality check. If you haven't done it yet, make Paul Krugman your first reading priority today. It's about the unsustainable growth that the stock market would need in order to make privatization work, and how, if the economy were actually growing fast enough to support that growth, Social Security wouldn't need reform.
Link | | 7:20 AM Home

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