Could We Grow Out of the Social Security Crisis?

Bob McManus-

The trustees used 2.2% for 2010-2015 and 1.8% for GDP growth the 2015 to 2080 period as their "intermediate" number.

See http://www.ssa.gov/OACT/TR/TR04/V_economic.html#wp168800

That's why there's a looming "crisis". Plug in something like 2.7% and 2.6% (the low Social Security cost GDP growth, and still below the historical average) and the crisis looks quite small.

Hehe, liberal. I believe in balanced budgets, states rights and no unnecessary foreign entanglements, which used to make me a Republican.

The potential for corruption with private SS accounts goes far beyond just stock commisions. Setting up sham companies to funnel SS dollars into, trading on inside information concerning which companies will be added to or removed from the 'approved' list of stocks, etc. are all being planned while Bush and his paid lackeys try to close the deal.

The manipulation of government laws and contracts for personal gain is the definition of capitalism to our current 'leaders'.

Bush spent his years between being a highly decorated cheerleader to his current job sitting on the board of sham companies and collecting millions from such diverse sources as George Soros and the Harvard faculty retirement fund.

Cheney has spent most of his life leaping like a greedy monkey between government jobs and compaines that do business with the government, getting richer with every jump.

And Delay, he is the king. From a start as a lowly cockroach killer, his minions are now extracting money from any company that wants to do business with the government. Consider the recent fleecing of the Indian gaming interests that coughed up $70 million in lobbying fees to Delay cabana boy Jack Abramoff.

Inventing a Social Security crisis so they can loot it is just business as usual to them.

Creating private SS accounts isn't the answer. Unless foreign stocks are going to be included on the approved list, there is a limited number of stocks that can be bought. At most there are 10,000 publically traded companies. Many are so small that one years worth of SS monies channelled into the market will buy half of them outright.

What's left? The US has two automakers left, Ford and GM, worth a combined $50 billion and losing market share fast to Japanese companies. Not a good stock play.

How about the airlines. Hahahahaha

The 'new' economy? Intel and Cisco lost a combined market value of $100 billion last year. Yikes.

How about the 'new new' economy? Ebay is valued now at $76 billion. Throw in Google and Yahoo and you have internet bubble 2.0

How about tobacco companies? Is the Federal government going to put these guys on the list?

"Big box' retailers? With oil prices fated to rise, I doubt Americans will want to drive miles out of their way to shop. Look for companies that set up neighborhood mico-stores. They'll be coming soon.

In short, US compaines, despite the fact that corporate taxes are at an all time low, the dollar is heading towards the peso in value, and the current administration has relaxed most restrictions on them, are still losing to foreign companies. They are a very bad investment.

No, monkeyboy, the point is to solve the problem before it is an immediate crisis. Clearly this is a concept that liberals don't understand - dealing with a problem early beats waiting until the last minute. An ounce of prevention being worth a pound of cure and all.

Now, I will admit greed enters into it for me personally - in my own view, dealing with it now beats the hell out of my paying into the system for another 32 years only to have the retirement age raised, benefits cut and taxes on my daughter (and possible grandkids) doubled just when I get ready to retire. Let me start putting even some of my money in the stock market now - I know economic history well enough to know that it will indeed result in much better returns.

Still, you want to talk about greed? Social Security is a regressive tax that redistributes wealth from relatively poor young people to the richest segment of the population. Some stock commissions don't compare to the greed of the rich white AARP.

I think you are missing the point, bob.

Of course there is nothing wrong with Social Security. A few minor adjustments can make it solvent for the foreseeable future. Medicare, pork, corporate welfare, etc. are much more logical targets for real libertarians and anyone else interested in fiscal responsibility.

The whole point to this 'crisis' is greed. The private accounts, that even the Republicans admit won't solve anything, are the real reason Social Security is the main focus of this administration.

Imagine hundreds of billions of dollars passing through the hands of stockbrokers on their way to boost stock prices to reward all the good Republicans holding stock options and the stocks themselves. It's no surprise that the large brokerage houses are the leading contributors to the current propaganda campaign calling for a 'fix' to Social Security.

You even see Republicans calling only for the private accounts with no adjustments of benefits at all. How tasty, skimming a nice cut off all Social Security taxes for the Republicans and their best pals. It looks like they slipped up on this try, though. I doubt the Republicans want to cross AARP, even with so much easy graft within their reach.

I suspect we'll just see more tax breaks for the wealthy and a lot more corparate welfare added to the budget if this try at looting Social Security fails...

Yglesias seems to be down, I'll come back with cites and quotes tomorrow if you like.

But according to my understanding, presuming an average 3.0 percent GDP growth rate, which is not unreasonable or overly optimistic...

and presuming the General Fund pays back what was borrowed from the SS Trust Fund, which is not at all certain but if Bush is going to default on all T-Bills, or whichever portion thereof he or his successors decide, I wish he would let the bond markets know....

FICA should keep SS completely solvent for fifty+ years. Now fifty years is not forever, but is certainly outside the range I would listen to anyone's predictions about the economy or gov't policy.

Monkyboy,

If you don't like it, there are plenty of other blogs to choose from. Heck, you even seem to realize this yourself, albeit rather dimly.

Bob,

What "reasonable economic projections" forcast the federal government's ability to meet its expected obligations to Social Security "always"?

Any such projections must be either foolish or dishonest (I vote for both), but in no case could they be reasonable.

It reminds me of the guy falling off of the building and announcing as he passes each floor "I'm OK so far!"

*Sigh*

Is this the best you can do, Will?

Your blog, based on a recommendation, was seeded third in my Blogs favorite folder, just below Andrew Sullivan and The Marginal Revolution. Now you have slipped near the bottom of the list, right below Fleshbot. Maybe I could group you two in a "Fake Boob" sub-folder.

Posting thoughts that just pop into yo head comes dangerously close to the 3 insta-kill type posts that get blogs removed from my list entirely:

3) My wonderful childhood memories
2) My wacky co-workers
1) My medical problems

*Sigh again*

"we could zero out the deficit and have huge surpluses in a fairly short amount of time"

Considering your previous post on "The Fictional Trust Fund" I think you are being unclear here as to whether you are talking about General Fund problems or SS problems. SS already is in massive surplus, and most of us in the blogosphere (via Yglesias and others) understand that under most reasonable economic projections, will left alone always be in surplus.

Admittedly, the General Fund crisis puts all predictions in jeopardy.