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Social Security privatization

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David Brooks is not happy about the way the negotiations over the so-called "fiscal cliff" have been going so far and expressed some of that discontent on this Friday's PBS Newshour. Brooks apparently has President Obama mixed up with House Speaker John Boehner when it comes to who has been "thumping" their chest during these negotiations.

He also accused President Obama of over-reading his mandate and attempted to link what's going on now to George W. Bush going out there and pushing his extremely unpopular views on privatizing Social Security, which Brooks called "reform" (a.k.a. privatizing) during this segment on PBS. Brooks now claims that it was a mistake for Bush to have done that back in 2004.

I looked around for any columns by Brooks after Bush made his statement that he had a mandate and didn't have any luck finding any. If any of our readers happen to come across commenting on the "mandate" remarks by Bush, I'd love to see what he was saying back then compared to now and if he's done a 180 on whether he thought actually thought Bush was wrong at the time, as he's saying he believes now.

I hate to bread it do David Brooks, but raising taxes on the wealthy is very popular with Americans. President Obama does actually have a mandate to do something about the income disparity in America, unlike Bush, where the more he talked about his plans for Social Security, and how wrong Al Gore was about the "lock box," and how the trust fund was nothing but a bunch of worthless I.O.U.s that those like him that borrowed against for wars and tax cuts should never have to pay back, the less popular his ideas became.

And I don't recall Bush campaigning on privatizing Social Security. So Brooks' analogy here is completely ridiculous, but that's about what I'd expect from someone who has spent his entire career trying to make Republican policies palatable to those they can con into voting against their own economic interests.

Here's more from Driftglass, who also flagged this segment and who thought as little of Brooks' remarks as I did:

Only in the precious, punch-drunk imagination of the Apostate Conservative is actually learning from your previous confrontations with vicious, reckless assholes considered an insulting affront to magnanimity.

Only measured by the dissolute sensibilities of the Apostate Conservative is opening negotiations by saying that you intend to do what you were just re-elected a stick in the eye.

Go read the rest for more on David Brooks' fellow Republican turd polisher, Andrew Sullivan's similar remarks.

Full transcript below the fold.

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CNN's Ali Velshi continues to use his weekend program, Your Money, as one long free infomercial for the Peterson Group. This Saturday his weekly round of fearmongering over the "fiscal cliff" was with none other than Ayn Rand fan Alan Greenspan, who is apparently now the latest spokesman for the Peterson Group.

And as Stephanie Kelton at Wall Street Pit noted, he seemed to be having a bit of trouble remaining consistent with remarks he's made in the past about our debt and Social Security. I don't think it's a leap at all to assume that he's reading from the talking points of the group who wants to privatize Social Security in order to enrich Wall Street, while standing in front of a wall full of their logos.

Here's more on that from Yves Smith at Naked Capitalism -- Greenspan’s Switch to Debt Scaremongering:

Stephanie Kelton provides two video clips to underscore the point that until quite recently, Greenspan made the point that MMT types do: that the US as a currency issuer, can always pay its debts (it might incur too much inflation, but with the economy having as much slack as it does, that’s far from a pressing worry).

What I found striking was the clip of Paul Ryan pressing the man formerly known as Maestro when he was still the Fed chairman to agree that private retirement accounts would be more stable than a government sponsored program. That’s such a Big Lie I’m amazed anyone can peddle it with a straight face. [...]

After 20 years of demonizing government debt and pushing for government in miniature, billionaire Pete Peterson and his allies have managed to get the public fixated on their message rather than their motives, and the Ryan con job serves as a useful reminder.

One long-standing effort has been to “privatize” Social Security, so that Wall Street could charge fees for managing the money. Note that some countries, like Australia, mandate that a big chunk of wage payments be invested in superannuation accounts (I’m not current on the law, but when I lived in Australia, it was 9% of pay, and I believe it has risen since then. The ATO’s pages on this are too layered to get a quick answer). And even if they don’t get a mandated contributions regime, merely reducing Social Security payments will force people to save and invest more, and will similarly enrich the brokerage and investment management industries.

But the other rationale is more basic: the rich want taxes lower, period. They want to roll the clock back to the 1890s. [...] This is our future unless ordinary people wake up and oppose it. Not surprisingly, Greenspan, who was never on the side of little people, has officially cast his lot in with it.

Full transcript below the fold.

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Never mind the John Doe investigation and the possibility that Scott Walker could get indicted in the coming months for the scandal that Ken recently wrote about here, Piers Morgan decided to press the latest darling of the right-wing, now that he won his recall election on whether he'd be interested in accepting an offer by Mitt Romney to run as his vice president.

Apparently Morgan believes his all of his viewers are completely oblivious to the investigation of Walker and did his part to make sure that those who are remained that way with this nonsense. Even Walker had a look of pain on his face while trying to explain why he'd turn Mitt Romney down if he was foolish enough to offer him a spot on the ticket.

Walker maintained that Mitt Romney should pick another of his fellow Wisconsinites instead, Rep. Paul Ryan. I'd be more than happy to see Romney take Walker's advice. If they think putting the poster-boy for dismantling our social safety nets on the ticket would be helpful and highlighting his positions as part of the presidential campaign, by all means, be my guest.

Walker shoots down VP talk:

Following his survival of a Wisconsin recall effort, Republican Gov. Scott Walker on Thursday pushed back against the idea of being tapped as a potential running mate for Mitt Romney.

Political observers point out that not only is Walker a rising star in the GOP, but having his name on the ticket could further push the blue state of Wisconsin into the Republican column this November.

Walker, however, had a different name in mind.

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Well, Haley Barbour might have bowed out of the GOP presidential primary, but we've still got wingnut Herman Cain in the running, who went on the air with Fox's Shannon Bream and recommended we privatize Social Security like they did in Chile under Pinochet, but don't dare call it privatization.

BREAM: Alright, will part of the tough solutions and will the strong medicine include entitlement reform? And how do you sell that to the American public?

CAIN: We have to go from an entitlement society, to an empowerment society. And what I mean by that, all programs need to be restructured. You can't just continue to raise taxes on these programs and decrease the benefits. And Representative Ryan's proposed budget is a great start in that direction. We can't just continue to do the same things we've done before.

For example, relative to Social Security. I think that we put the idea of personal retirement accounts back on the table and do what Chile did thirty years ago. They don't have the problem we have today. Now it got demagogued last time as privatization. That absolutely is not the case. We need to take that route, restructure Social Security so we can achieve solvency, or the problems we're encountering, the crisis that we now have, they're only going to get worse.

Someone needs to tell this clown that Social Security is solvent. And if he thinks the GOP ought to run on privatizing it, whether he wants to call it that or not, more power to him. That didn't work out so well for George Bush, but apparently he's got a short memory. We can fix any shortfalls with our system by simply raising the cap on payroll taxes, or better yet, lift the cap and make it less regressive while we're at it.

And if he wants us to follow Chile's model, maybe someone could direct him to this article -- Chile's Retirees Find Shortfall in Private Plan.

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Neil Cavuto interviewed former welfare recipient and now wingnut welfare recipient Star Parker who is running for the US House of Representatives in California. What's sad is her incoherent nonsense actually represents what the Republicans are running on this year, Social Security privatization. And the voters are going to love an "independent thinking" Republican that promotes this platform. There's nothing "independent" about it and if they think the voters are going to like this, they're sadly mistaken.

That won't stop them from coming on the air day after day pretending we need to hand our social safety net over to Wall Street though in order to "save it" though.

Parker: Well we know that Republicans are going to sweep the House and perhaps even the Senate because people are looking at what Nancy Pelosi has done which is build out bigger government and they are frustrated. We've already seen the damage of large government. We can look into any inner city in this country and see the damage of big government.

And even union workers now are getting pink slips. We're falling apart in California and we're falling apart as a nation, so she's... the referendum is on Nancy Pelosi.

Cavuto: But it's not necessarily a love hug for you and the Republicans right? I mean they just hate you guys less pretty much, right?

Parker: Well, that might be true. It just depends on what type of Republican is sitting in that room when we have our orientation. I'm going to win my district, the 37th here in California. So it just depends if it's an independent thinker, if it's somebody that perhaps has looked out at this type of debt and said we cannot go this way any longer and we're going to be willing to make the hard choices, then they will fall in love with Republicans.

Cavuto: When you say hard choices, so what are they? […] I always hear there are hard choices... like what?

Parker: Hard choices like the collapse of Social Security. Hard choices like the collapse of Medicare. (crosstalk)

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Grover Norquist, no big surprise here wants those Bush tax cuts kept in place and wants to see Social Security turned over to Wall Street. What was surprising was his attempt at some history revisionism. When Eliot Spitzer pointed out how unpopular the idea was when George Bush tried pushing it, Norquist pretended that's not what Bush was wanting to do. I wonder if Norquist had read this yet before he came on Parker and Spitzer's show?

George W. Bush Reveals His Biggest Failure Was Not Privatizing Social Security

Oh well, it's not like anyone ever accused Abramoff buddy Norquist of being honest about anything. Another typical Republican liar trying to make sure the rich keep theirs.

SPITZER: We spoke with Fareed Zakaria about his piece in "Time" magazine, "How to Restore the American Dream." We now have a very different perspective.

Grover Norquist, the president of Americans for Tax Reform, thank you for being with us. Grover, a central piece of your proposals is to extend the bush tax cuts in perpetuity, which many people, including the Congressional budget office, says would double the federal deficit to about $11 trillion over the next decade.

So, I'm going to ask you the same question we're asking everybody in our new program here called "Name Your Cuts," how do you balance the budget with that enormous tsunami of red ink facing us? What are the specific cuts you would make? What are you doing specifically on Social Security and Medicare? Because the other things you list here, I agree, about Afghanistan, those numbers are not going to be there available in the next year or two. What are you going to do on Medicare and Social Security?

PARKER: Would you raise the retirement age to 70? GROVER NORQUIST, AMERICANS FOR TAX REFORM: Well, I'm actually more in favor of moving all of our entitlement programs from defined benefit plan, which is what we have at present, what General Motors had for their pension setup, to defined contribution, basically to 401(k)s. The state of Utah has just done this. And I'm big on taking a look at something that just happened somewhere. Utah, this last year, just passed a new law, next July 1st all new hires in the state of Utah, state employees and local government employees, will have your pay plus 10 percent into a 401(k). They're not creating any more unfunded liabilities in Utah now into the future.

Every state could do that. The federal government could do that both with their employee, we do that with postal employees, which are a large chunk of government employees and we could do it with Social Security. I'm not necessarily in favor of raising taxes or -- on Social Security and cutting benefits. Both of those make your investment in Social Security as a taxpayer worse, a worse deal. That...

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CNBC anchor Michelle Caruso-Cabrera visited the set of Morning Joe to push her new book You Know I'm Right and apparently we've got another Ayn Rand fan working for CNBC. After saying that the auto companies should have been allowed to fail, presumably to get rid of those pesky over paid union workers, Mike Barnicle asks her if she thinks we're going to have to raise taxes to pay our deficit.

Cabrera of course doesn't think we should raise taxes and says that instead we should cut spending. Leslie Stahl asks her where. She replies:

Easy stuff; you get rid of the Department of Labor, the Department of Commerce, the Department of Education. You can get rid of all of those. They're not necessary. You don't need that stuff done at the federal level.

But the real issue, let's talk about it – Social Security and Medicare, right? We have over promised so much that someday if we don't do something, we're going to be Greece. We're on the path to that. So what you do right now is you tell young people instead of saving that Social Security and giving it to the government, you're going to have a personal account, and that's going to be your retirement. And in the mean time, as you get closer to retirement, you're going to have to live on that money instead, because...

Leslie Stahl asks her what happens when the markets crash again and there's no safety net. Her answer:

Well, this is the choice, okay? So you're saying the choice is I can have the government pay me in the future guaranteed, or I can have this uncertainty of the market. I see it differently. I see the uncertainty of the markets or the uncertainty of some future Congress, some future bunch of people who are... can at any day decide you've got to retire later. You've got to put up more money.

Or in other words, don't dare expect the rich to pay back the Social Security trust fund and you're on your own for your retirement. Her buddies on Wall Street crash the economy again... too bad, so sad. Cabrera would fit right in at the Tea Party rallies.



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The aptly named Dick Armey is a real piece of work. As Think Progress noted, the former Speaker of the House turned Freedom Works astroturf teabagger leader came on Eliot Spitzer and Kathleen Parker's new show on CNN and lied about the state of Texas benefiting from federal funding for higher education.

Dick Armey Wants To Completely Eliminate Any Federal Funding For Higher Education:

At one point, Spitzer asked Armey a series of questions about what he thinks the government should and should not be involved in funding to try to “add texture” to what the FreedomWorks chairman believes. During this question period, the CNN host asked Armey if he would “have the federal government pay for higher education?” Armey bluntly responded, “No, I would not.” He then went on to say that the university system of his home state of Texas has “not been made any better by federal money involvement. [...]

Armey’s claim that the “federal government’s involvement in education” hasn’t “benefited the students of America” is wildly false. [...]

Texas students are major benificiaries of this spending. Students in the state actually utilize federal student loans at a level above that of the average U.S. student. During the 2006-2007 school year, 83 percent of Texans utilized federal student loans, compared to 71 percent of Americans.

Spitzer did a good job of getting Dick Armey to lay out just what programs he and his corporate funded "Tea Party" would like to eliminate or drastically cut from federal government funding. Naturally military spending wasn't on the list, but Social Security privatization among a lot of other cuts to social programs were. These people like Dick Armey and his ilk aren't going to be happy until they turn us into a third world country with nothing but rich and poor. It was nice to see him get forced to lay out some specifics instead of just platitudes for once as he was in this interview, not that he was short on his usual platitudes as well as he answered. Big 'gubmit is evil, unless of course you privatize everything so it's used to just funnel money to your corporate funders and we need the "freedom" to pick ourselves up by our own bootstraps.

That works our pretty well for folks like Dick Armey who aren't living on a shoestring and have a lot of large corporate interests making sure he's never going to be hurting or worrying about how he's going to feed his family or pay his bills. For the rest of us, not so much. I wonder if Dick Armey knows what the minimum wage is? My bet is he either doesn't know, or doesn't care just like the rest of these Republicans who are trying to con the working class into thinking care about anything but the interests of big business. The only "freedoms" a Dick Armey cares about are the "freedoms" for corporations to force Americans to compete with slave wages overseas while funneling our tax dollars to the wealthiest among us who pay his bills to help spread their propaganda.

Transcript below the fold via CNN.

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On C-SPAN's Washington, Rep. Dan Lungren touts his cohort Rep. Paul Ryan's web site, A Roadmap for America's Future as where to look for the Republican's plan to balance the budget. Lungren claims that the site lays out a way to "save" entitlement programs such as Social Security. Of course by "save" he means privatize.

A Roadmap for America's Future

Here's what it says about Social Security under the "Roadmap Plan 2.0"

  • Preserves the existing Social Security program for those 55 or older.
  • Offers workers under 55 the option of investing over one third of their current Social Security taxes into personal retirement accounts, similar to the Thrift Savings Plan available to Federal employees. Includes a property right so they can pass on these assets to their heirs, and a guarantee that individuals will not lose a dollar they contribute to their accounts, even after inflation.
  • Makes the program permanently solvent – according to the Congressional Budget Office [CBO] – by combining a more realistic measure of growth in Social Security’s initial benefits, with an eventual modernization of the retirement age.

And here's their plan for Medicare/Medicaid:

  • It preserves the existing Medicare program for those currently enrolled or becoming eligible in the next 10 years (those 55 and older today) - So Americans can receive the benefits they planned for throughout their working lives. For those currently under 55 – as they become Medicare-eligible – it creates a Medicare payment, initially averaging $11,000, to be used to purchase a Medicare certified plan. The payment is adjusted to reflect medical inflation, and pegged to income, with low-income individuals receiving greater support. The plan also provides risk adjustment, so those with greater medical needs receive a higher payment.
  • The proposal also fully funds Medical Savings Accounts [MSAs] for low-income beneficiaries, while continuing to allow all beneficiaries, regardless of income, to set up tax-free MSAs.
  • Based on consultation with the Office of the Actuary of the Centers for Medicare and Medicaid Services and using Congressional Budget Office [CBO] these reforms will make Medicare permanently solvent
  • Modernizes Medicaid and strengthens the health care safety net by reforming high-risk pools, giving States maximum flexibility to tailor Medicaid programs to the specific needs of their populations. Allows Medicaid recipients to take part in the same variety of options and high-quality care available to everyone through the tax credit option.

I guess they all assume that seniors are willing to throw their grandchildren under the bus to keep their existing benefits rather than pay back the Social Security trust fund that's been borrowed from. We've just got to keep those tax cuts for the rich don't you know. Lungren finished off the segment pretending his party hasn't already made sure that the next generation of Americans isn't going to do worse than their parents. Sorry pal, too late.



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Oh lookie... Dick Armey has a book to sell. So needless to say he's been all over the airways pushing it. He appeared on C-SPAN's Washington Journal and right after telling everyone that part of the Tea Party's agenda would be to "ask the government to... relieve yourselves of the unnecessary burdens" he pretends that they really don't want to privatize or phase out Social Security and calls Tim Kaine "funny" for calling them on it. He can't defend his views so he has to attack Kaine personally instead.

Orgel: Dick Armey a viewer here wants some detail on what will be cut. Via Twitter they ask “What specifically is the Tea Party plan once their candidates take over. What are they going to cut?” Can you tell us?

Armey: Yeah. One of the things we would ask the government to do is relieve yourselves of the unnecessary burdens. For example, just make… make so many of your now mandated benefits voluntary. If Social Security is such a blessing, make it voluntary. Anybody who wants Social Security as you know it today, guarantee it to them and keep your word and then let anybody who wants to be free to choose to do something else, let them be free to do that.

Healthcare… let me be free to choose and take care of my own healthcare needs if I can do that and I don’t need government assistance, leave me alone. Let me be free to choose. And in doing that the government relieves itself of financial obligations they didn’t need to have taken on in the first place.

Why in the world would it be good public policy to compel people like myself who can easily afford their own health insurance to participate in a government provided health insurance and put the burden of that taxation on my grandchildren? Just leave me alone and leave me be free to take care of my own health.

So if you let these programs be voluntary the costs can be enormously reduced. Then be careful with how you spend money. Establish priorities. Make trade-off decisions. Lower and simplify taxes to make it a civilized tax system. There are so many things this government can do to be a blessing and a service to the lives of the American citizenry at large rather than a burden, but for Lord’s sake don’t take on unnecessary, costly burdens, imposing the cost on our grandchildren for something you didn’t need to do, but wanted instead to only do to enhance your power for that moment.

It’s not about you Mr. Senator, Mr. Congressman. You’ve got a privilege from your neighbors. Don’t make it about yourself and your power. Make it about a service in the lives of the citizens who trust in you and gave you this great privilege.

Host Paul Orgel then plays a video of Tim Kaine explaining what the Tea Party’s agenda is. The Republican Tea Party Contract on America:

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