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Wednesday, February 08, 2006

Surprise!
Posted by Jill | 1:16 PM

Remember how Bush's Social Security privatization plan went over like a lead ballooon? Remember how you thought it was dead?

Well, when you elect someone who thinks he's a king, nothing is dead if he doesn't say it's dead.

Bush's $2.7 trillion budget plan has a little surprise in it, one you never saw coming:

Last year, even though Bush talked endlessly about the supposed joys of private accounts, he never proposed a specific plan to Congress and never put privatization costs in the budget. But this year, with no fanfare whatsoever, Bush stuck a big Social Security privatization plan in the federal budget proposal, which he sent to Congress on Monday.

His plan would let people set up private accounts starting in 2010 and would divert more than $700 billion of Social Security tax revenues to pay for them over the first seven years.

If this comes as a surprise to you, have no fear. You're not alone. Bush didn't pitch private Social Security accounts in his State of the Union Message last week.

First, he drew a mocking standing ovation from Democrats by saying that "Congress did not act last year on my proposal to save Social Security," even though, as I said, he'd never submitted specific legislation.

Then he seemed to be kicking the Social Security problem a few years down the road in typical Washington fashion when he asked Congress "to join me in creating a commission to examine the full impact of baby-boom retirements on Social Security, Medicare and Medicaid," adding that the commission would be bipartisan "and offer bipartisan solutions."

But anyone who thought that Bush would wait for bipartisanship to deal with Social Security was wrong. Instead, he stuck his own privatization proposals into his proposed budget.

[snip]

Duffy said privatization costs were included in the midyear budget update that the Office of Management and Budget released last July 30, so it was logical for them to be in the 2007 budget proposals. But I sure didn't see this coming—and I wonder how many people outside of the White House did.

Nevertheless, it's here. Unlike Bush's generalized privatization talk of last year, we're now talking detailed numbers. On page 321 of the budget proposal, you see the privatization costs: $24.182 billion in fiscal 2010, $57.429 billion in fiscal 2011 and another $630.533 billion for the five years after that, for a seven-year total of $712.144 billion.

In the first year of private accounts, people would be allowed to divert up to 4 percent of their wages covered by Social Security into what Bush called "voluntary private accounts." The maximum contribution to such accounts would start at $1,100 annually and rise by $100 a year through 2016.

It's not clear how big a reduction in the basic benefit Social Security recipients would have to take in return for being able to set up these accounts, or precisely how the accounts would work.

Bush also wants to change the way Social Security benefits are calculated for most people by adopting so-called progressive indexing. Lower-income people would continue to have their Social Security benefits tied to wages, but the benefits paid to higher-paid people would be tied to inflation.

Wages have typically risen 1.1 percent a year more than inflation, so over time, that disparity would give lower-paid and higher-paid people essentially the same benefit. However, higher-paid workers would be paying substantially more into the system than lower-paid people would.

This means that although progressive indexing is an attractive idea from a social-justice point of view, it would reduce Social Security's political support by making it seem more like welfare than an earned benefit.


And of course once it's perceived as welfare, then you have the political ability to kill it entirely.

Surprised? Why? Bush has made no secret of his dictatorial/monarchical leanings; his view that he and only he is the final arbiter of what is law in this country.

This is what the Democrats get for assuming that this president is coming from a position of goodwill and bipartisanship. This is what the Democrats get for thinking they could work with this guy.

And this is what we all get for allowing the Democrats to weasel out of their responsibility to us.

Now let's see if they can stop this -- if not directly on the floor of Congress, then by mounting ferocious challenges to anyone -- Democrat or Republican -- who DARES vote for this.

Because no matter what you think about Social Security, this is NOT how laws are made in this country. Not if you want to keep that fucking flag on your car and call yourself an American.
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