Social Security Reform - The Big Brawl
I have resisted writing about this subject as I still feel that there is much left to learn about President Bush's plan for privatization, and volumes of details to iron out vis-a-vis Social Security reform. The broad nature of the plan and the remarkable number-doctoring spin being applied (by both sides) leave most of us mere mortals scratching our heads in frustration and dismay. Even more perplexing is the disingenuous outcry from some that Social Security is NOT headed for a crisis - despite statements to that affect by their hero, Bill Clinton.
((Upate: See the latest from FactCheck.org, entitled False Attacks Over "Windfalls" to Wall Street ))
Now that President Bush has returned from his arguably fruitful and symbolic kiss-and-make-up-with-the-allies trip abroad, he has turned his attention once again to this, his primary domestic initiative (and as with all other Bush efforts, uphill battle).
According to an article today from Associated Press:
"If left unchanged, beginning as early as 2018, Social Security is set to pay out more in benefits than it collects in taxes. And by 2042, the money stored from past surpluses will be exhausted and Social Security will only be able to pay 73 percent of promised benefits from the revenues it will be taking in, according to the retirement program's trustees."
"Bush has said all options are on the table for strengthening Social Security, except for hiking the payroll tax rate. He has firmly opposed raising the 12.4 percent tax rate on wages up to $90,000. But he and his advisers have been vague about whether he would go along with increasing the total amount of earnings subjected to that taxation."
LIBERAL SPIN: What many liberals seem to be forgetting (or leaving out in their arguments) is that this is NOT a completed program plan, as President Bush has repeatedly asked that both sides assist in hammering out the details. As mentioned above, it is only the tax rate that he is unwilling to negotiate. Unbeknownst (apparently) to most AARP members is Bush's promise NOT to change the current program for those now over 50. Bush is also faulted for his (some forget the word "optional" here) privatization plan for a portion of an individual's fund - this coupled with wild accusations of Wall Street intrigue and high-risk "gambling" with the security of our youth, while what is being proposed is not investment commodities, but in far less risky and broadly diversified stock and bond mutual funds.
In an article from February 2, FactCheck.org made the following contention:
"What MoveOn.org calls "Bush's planned Social Security benefit cuts" is actually a plan that would hold starting Social Security benefits steady in purchasing power, rather than allowing them to nearly double over the next 75 years as they are projected to do under the current benefit formula."
Of course, the 20,000 dollar question is this: How are we going to pay for it? That, my friends, is a matter for both sides to decide together once they stop spinning.