Text 9465, 238 rader
Skriven 2005-03-01 06:07:00 av TIM RICHARDSON (1:123/140)
Kommentar till en text av LEE LOFASO
Ärende: If It Ain't Broke...
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On 03-01-05, JOHN HULL said to LEE LOFASO:
JH>28 Feb 05 18:21, LEE LOFASO wrote to JOHN HULL:
LL> Hello John,
>>JH>Perhaps you don't know that FDR intended to implement the same
>>JH>sort of savings accounts that Bush is talking about.
>>LL>Well, John, to be perfectly honest, I didn't know that.
>>LL>So please fill me in. IOW - Put up or shut up.
>>LL>BTW, just because Britt Hume said so does not make it so.
>>LL>And just because Newt Gingrich said so does not make it so.
>>LL>And just because John Hull said so does not make it so.
>>LL>Please show cites, where FDR said what you claim. If you can.
>>LL>Gosh. I love this "put up or shut up" rule. :)
- Bush, FDR and Social Security-
Bush, FDR and Social Security
By Nick Schulz Published 02/17/2005
Shortly after President Bush's State of the Union address New York
Times columnist Paul Krugman accused President Bush of trying to
"destroy" the America created by FDR by introducing private
accounts into the Social Security system. I wrote a column at the time
claiming Krugman was wrong and that, based on some principles FDR
outlined in a message to Congress when Social Security was being
constructed, one could reasonably conclude that Bush's effort was
in keeping with the principles outlined by FDR.
The invocation of that message to Congress by advocates of Social
Security reform has left-wing critics of the Bush administration
in a lather. In early February, some prominent journalists and
talking heads such as Brit Hume of Fox News discussed the principles FDR
articulated in that message to Congress. What Hume et. al. claimed
FDR meant in his message got the political left in high dudgeon.
David Brock's group Media Matters accused them of bad-faith and
misrepresenting what FDR actually said. Radio host Al Franken
picked up on the Media Matters attacks and pilloried Hume and others. And
now TV anchor Keith Olberman is in on the act, attacking Hume et.
al. You can read their arguments and decide for yourself who is
correct.
Then on Tuesday night Al Franken's blog linked to my piece and my
email box started filling up with people calling me an idiot,
saying I was clueless, didn't understand FDR, and worse. With Franken et.
al. beating this drum, let's see if we can't revisit the FDR quote
to make some sense of the debate over it.
So what did FDR say? Let's look again at the quote:
"In the important field of security for our old people, it seems
necessary to adopt three principles:
First, noncontributory old-age pensions for those who are now too old to build
up their own insurance. It is, of course, clear that for perhaps 30 years to
come funds will have to be provided by the States and the Federal
Government to meet these pensions.
Second, compulsory contributory annuities that 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."
It seems plain that FDR was calling for a system that was
predicated on two essential components. The first was that it be
"self-supporting". That sounds reasonable enough -- who wants to
create a system that can't support itself? The second is that part
of it be "compulsory". Given the context -- a Great Depression
that left many older Americans in dire straits -- that made sense, too.
The government would encourage you to save by creating mechanisms
that force you to save, taking your money away from you so that
you can't spend it on something else. That way there would be no
excuses for being old and being without. FDR also called for a voluntary
component to the system as well.
Now, let's look at those components in the context of the current
Social Security system and then in the context of Bush's proposed
private accounts.
Is the current system "compulsory"? Of course. Is the current
system "self-supporting"? In one sense, yes but in a more important
sense, no.
The current system is pay-as-you go, meaning today's contributions
from workers go to today's retirees. The government taxes over 12%
of income and retirees get their benefits from that tax base. The
system supports itself … today.
But the system as currently constructed is not self-supporting in
any meaningful sense in the long term. As William Sterling has
pointed out, the wage indexing changes initiated to the program in
the 1970s mean benefits rise much faster than they used to. Couple
that with demographic shifts in which the worker-to-retiree ratio
drops dramatically, and the system literally can't support itself
without changes -- without massive tax increases, benefit cuts,
means testing, the inflationary printing of more money, or any of
a series of other possible changes.
Now let's look at FDR's principles in the context of Bush's
proposed private accounts.
Is what Bush proposes compulsory? Yes, in the sense that people
would still be forced to contribute to their retirement. They
would have more choice over what form that contribution should take.
They could decide to take smaller checks from the government in the
future in return for being able to use some of their contributory
funds to invest in stocks and bonds. But they would not be able to
spend that money on groceries or housing or clothes or vacations
or anything else. Bush's plan involves just as much compulsory saving
for retirement as the system we have inherited from FDR.
Is what Bush proposes self-supporting? In an important sense it
moves Social Security in a direction that's by definition more
self-supporting than the current system. Money that's put into a
private account with your name on it will be there for you when
you retire. Your money, your retirement. And the cuts in future
benefits that Bush appears to favor would make the program solvent.
No, FDR never wanted a completely voluntary or purely private
system to replace Social Security -- and some commentators may have
spoken carelessly in suggesting that he wanted it replaced. Either way,
that's not what Bush is proposing. By making the system more
transparently self-supporting while keeping it compulsory, Bush's
effort is in keeping with the broad principles outlined by FDR.
The benefits from private accounts will supplement government checks,
not replace them.
What's more, it's important to remember that Social Security taxes
and benefits have grown enormously since FDR's day. So cutting
benefits two generations from now as a way of making some room for
the financing of private accounts within the Social Security
system today can't possibly be viewed as a violation of FDR's original
vision -- and probably brings us closer to it.
Lastly, rather than being an attack on the New Deal --
"destroy"ing FDR's America, as Krugman alleged -- the kinds of changes
initiated by the Bush administration can just as easily be considered an
expansion of the welfare state. Up until now, the welfare state
has given Americans only income support. Bush's proposal would have it
give Americans the opportunity to accumulate wealth, as well. But
it is an expansion of the welfare state that reduces the public's
dependence on the state -- which may be why some of FDR's
self-styled heirs hate it so.
LL> Put up or shut up, John. Either you can qualify your above
LL> statement, LL> or you can't. It's that simple.
LL> Put up or shut up, John. You made the statement saying "FDR
LL> intended to implement the same sort of savings accounts that Bush is
LL>talking about."
LL> Qualify your statement. If you can.
LL> Put up or shut up, John.
LL> Then put up or shut up. Qualify your statement. If you can.
LL> Then put up or shut up. Qualify your statement. If you can.
>>LL>Then put up or shut up.
>>LL>Then put up or shut up. Failure to do so would be your admission
>>LL>of being a bona fide liar.
LL> Put up or shut up. Qualify your statement concerning FDR.
LL> You can do it. If you try. Or maybe you can't. In which case
LL> I can easily understand your embarrassment.
LL> Put up or shut up. Qualify your statement. If you can.
LL> Put up or shut up, John. Qualify your statement. If you can.
LL> Put up or shut up, John. Qualify your statement concerning FDR.
LL> If you can.
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