Random Thoughts on Social Security

As the debate on the future of Social Security heats up, there are many important points that will remain unspoken. No, I am not going to speak them all, but I would like to make a couple of points that I have learned recently.

Taking the broadest view, what is really the purpose of the Social Security retirement plan? I am not extremely knowledgeable on the historical details, but it seems that it was to provide a safety net for retirees. Is this still the purpose? Many would say no. Peter Peterson, in his book Running on Empty, attacks the myth that Social Security and many other entitlement programs benefit the needy. Social Security simply moves billions of dollars around among the middle class (while having given Congress a very large slush fund to spend on projects that are largely outside the federal budgetary process).

Under a privatization plan, Social Security becomes an investment plan that matches personal contributions to a retirement plan. Is this the purpose of Social Security? Personally, I think we would all be better off with a means-tested program. The wealthiest individuals in our country (yes, including me) can get by fine without Social Security retirement payments and medicare. If we turn Social Security into a means-tested program, the total cost of the program could be cut dramatically. Demographics have shifted over the past fifty years and the over 65 group is now among the wealthiest of our citizens, not the poorest as was the case 70 years ago.

Regardless of the privatization or insurance concept, the most important issue right now is to keep the program solvent. President Bush says "no increase in Social Security taxes" but does not indentify a means of funding his program. The democrats say that the program is well-funded, but avoids the fact that it is funded with IOUs that Congress has deposited in the SS fund over the past several decades as it used the money to fund normal budgetary expenditures.

I believe that the dollars to fund future payouts of Social Security should be paid from general tax revenues to the extent of the IOUs, rather than using Social Security withholding taxes. Why? Over the past 50 years Congress has funded programs using the most regressive tax, social security. The lowest paid workers pay a whopping 6+% of their gross income, while other citizens with get a free ride with income over $100,000. If these funds are paid out in Social Security, that is one thing. But, if you are using these funds for general expenditures, this is in total opposition to the progressive tax principles. Although I don't have figures on the relative amounts of Social Security funds used for general budgetary expenditures, this sleight of hand has had a major impact on how we fund our government and who pays.

Our country has the lowest tax rates of any industrialized country. Yet, there are many citizens who believe that every increase in benefits should be accompanied by a corresponding cut in taxes. It seems to be a national personality trait that we want it all but don't want to pay for it. If we don't deal with our national debt soon, we face economic collapse and/or loss of our position of economic superiority. Let's start by dealing honestly with Social Security and arrive at a plan that is affordable and fair.

Freedom Isn't Free

I don't get it. I often see the sticker with the slogan "Freedom isn't free!" on cars arrayed with "Bush '04" and "Support our Troops" stickers.

Yet, the President refuses to increase taxes to pay for the war in Iraq or efforts to protect our borders . Just today, we learned that Bush's budget proposal has cut funds for the 2,000 additional border agents required by the National Intelligence Reform Act that congress passed last December. (As I recall, this element was added to the bill as a last minute concession to the conservative Republican holdouts that held up passage of the act. Two months later we find that he never had any intention of funding this portion of the measure.)

Of course, Bush's credit card approach to government has been exacerbated by the hundreds of billions of dollars in tax cuts granted to the wealthiest Americans that he now wants to make those cuts permanent. Meanwhile, Americans currently pay the lowest rate of taxes of the world's twenty seven developed nations (this according to Peter Peterson, a lifelong Republican and former Secretary of Commerce under President Nixon). The U.S. pays less that 2% of its GDP in taxes every year. . . as compared to most industrialized countries 4%.

This hypocrisy reveals the true motives of our president and the gullibility of our voters. Even if you oppose this War on Iraq (not to be confused with the War on Terror) as I do, for the sake of our country and our children's children, let's pay our fair share of the cost of Freedom and the privileges we enjoy as American citizens. The cost is well worth it.

Our "Do-nothing" President Ignores the hard work.

President Bush's to-do list for February must look something like this:

1. Try to clean up the mess I made in Iraq
2. Threaten Iran with military action
3. Ignore North Korea's nuclear weapons.

With today's announcement by North Korea that they now have enough enriched uranium to produce six nuclear weapons, the threat from the world's most dangerous rogue nation increases. Yet, our president will not negotiate with Kim Jong Il and his evil empire, insisting on six-party negotiations.

Bush's refusal to break the stalemate and enter into bilateral negotiations with North Korea does not reflect a grand strategy destined for success. Rather, it belies an inability to come up with any creative solutions to the problem other than cinvincing China to persuade North Korea to back off on its nuclear program.

Yes, six-party talks would be nice. But if North Korea will not engage in multilateral talks, we can not simply walk away from the table. The lives of millions of South Koreans, Japanese and Americans depend on defusing this extremely dangerous situation. To paraphrase Donald Rumsfeld, "you must go to peace with the negotiations you have, not the negotiations you wish to have."

It is time for our president to accept responsibility for his rhetoric and actions over the past four years and deal with the situation he has created as other nations respond to our threats and military action. He must also accept the responsibility of his office and protect the American people and our allies from this greatest threat to our national security.

"There's no place like home!"

Wow, I cant believe I am finally here in Blogland! The last thing I knew, I was sitting at home at my computer. Then, I closed my eyes, clicked my heels together, and ... Pooof! Here I am!

This is largely a place for me to post some of my political ramblings that too often found their way to only to the local newspaper editor's round file via the Letters to the Editor submissions.

Hopefully, some of these posts will be worth reading. Feel free to comment. I prefer facts and opinions to ad hominem attacks and sarcastic comments.

bruce