Is Bush Playing Pin the Social Security Tales on the Obstructionist Donkeys?

I don't get this. Is the administration trying to revive Social Security reform? It's appeared twice in the last few days, once in a speech Bush gave to The Economic Club, and also twice in responses in a Q&A on the economy with John Snow - both are featured prominently on the White House web site. The Q&A is not spontaneous, the questions were emailed in advance, so their inclusion was intentional. Of course, since they chose questions on the economy such as "who decides which figure's picture goes on the money" and "why did you take away the two dollar bill?," being chosen for inclusion may not mean much. In any case, I don't see the advantage in raising a dead proposal unless there will be an attempt to include Social Security in tax reform proposals. But tax reform appears to be in enough trouble already without adding the politics of Social Security. There is one other possibility I can think of. These were discussions of how well the administration has guided the economy and the economic agenda for the future. Perhaps they didn't have enough to say and threw in the parts about Social Security to fill the void. Here's a small part of the remarks on Social Security reform made by Bush in his speech:

We ... have got to do something about Social Security and Medicare. As you know, I brought up the -- (applause.) They told me not to talk about it when I first got up here. (Laughter.) But I've been talking about it ever since I've been running for President and since I've been the President because I believe the job of a President is to confront problems and not pass them on to future Presidents and future Congresses. (Applause.)  ... I'm going to continue to talk to the American people on this issue, and insist that Congress do the right thing and work together to save Social Security.

And here's John Snow:

Jon, from NY, NY writes: Why am I still left thinking there never was a social security crisis?

John Snow Well, Jon, that’s because the crisis is in the future – the President brought Social Security to the forefront of the Washington, DC policy agenda because there is a very serious looming crisis for the system. ... The problem you’ve heard so much about will begin as cash flows for the program turn negative in 2017, and the trust fund itself will be exhausted in 2041...

And this one is interesting:

daniel, from westport, ct writes: Can you tell me how much of the excess Social Security payroll taxes -- payroll taxes collected by the government but not spent on benefits -- have been spent on government operations in the past five fiscal years? And if Social Security is facing a crisis, why were those funds spent on government operations?

John Snow Thanks for this terrific question, Daniel. The total amount of Social Security surpluses that have been spent on other programs is at $1.7 trillion today. It’s a bad habit that government has, of borrowing money from the Social Security fund and writing itself “IOUs.” I think it’s time to put a stop to that, don’t you? That’s why the President wants to let younger workers put their Social Security dollars in personal accounts – the ultimate “lock box” for their hard-earned retirement dollars. We also need to make the program solvent. Progressive benefit growth, which would bring the program about 70 percent of the way to solvency, is another important element of the President’s proposed changes...

So is this an attempt at a revival? A resurrection of privatization? Habit persistence? An attempt to capture political gain by appearing concerned and unwilling to give up on the issue? That's my guess, that it's an attempt to capture political gain and revive the labeling of Democrats as obstructionists.

Note: Looking back at the last attempt at Social Security reform, how do you rate? If you are an orange state, the president visited you and gave a speech on Social Security:

Comments

[Bruce Webb]

Killing Social Security is the Holy Grail for a whole wing of the Republican Party. And a lot of these guys are cold eyed realists who know the numbers but want to kill it anyway. Instead of attacking it head on ideologically they chose to sell a narrative: "Social Security bankruptcy".

Millions of parents across this country routinely choose to lie to their children and suggest that Santa Claus, the Tooth Fairy, and the Easter Bunny are actually historical actors. Does this make them malicious? No. Do they expect to get away with the story forever? No. Do they expect the older kids to play along or else? Mostly yes.

"Cutting taxes for the wealthy increases tax revenues" "Social Security faces dire crisis". The older siblings at the Cato Institute by and large understand that these are fairy tales, but as long as they keep the little kids under control they serve useful purposes. But at this point Democrats are dead set against simply embracing the Bunny Rabbit of Social Security "Crisis" and there is no sign that the early Bush campaign of riling up the metaphoric little kids to demand a "solution" to the "crisis" or else is working.

So the bottom line in this case is the bottom line. There is no way to introduce Social Security legislation, in conjunction with tax bill or not, that does not require release of a set of numbers. And absent some incessant chanting of "are we there yet?" from the back seat (and the kids have been remarkedly quiet so far) the grownups will be free to study the proposed Social Security road map in peace.

The Priatizers' suggested road directions make no sense. A plain examination of the numbers suggests we are on the Superhighway to Solvency yet these people want us to believe there is a huge car wreck up ahead and we need to take a bypass route. But when asked to present the evidence for a pileup of wreckage up ahead in light of the free flowing traffic they bob and weave and say "we have known for years that there was going to be a horrible crash at milepost 2023, oh I meant milepost 2029, oh I meant milepost 2034, oh I meant milepost 2041"

Snow is just passing out candy to the kids in the back seat to keep them quiet. Because the last thing the Republican Party needs right now is for the American "kids" to recognize that Iraqi WMDs, Social Security "Crisis", and the Easter Bunny have pretty much the exact same existential reality.

[engr.dr.samuel.adeniyi.ajanaku]

Tell Sen. Jon Corzine and Sen. Frank Lautenberg,BOXER,SARBANES,KERRY,KENNEDY,FEINGOLD,BINGAMA,LIEBERMAN,HARKIN,REID, I AJANAKU Won't Support Efforts To Obstruct Plans for Strengthening Social Security!
President Bush is looking to work with Democrats in confronting the challenges facing our nation, but some Democrats in Congress are looking to obstruct the President's bold second term agenda in an effort to score partisan political points even at the cost of accomplishing the business of the American people.
While President Bush is displaying leadership and following up on his campaign pledge to preserve Social Security for future generations, Sen. Jon Corzine and Sen. Frank Lautenberg should not have pessimism and negativity while presenting no plan or vision for preserving Social Security.
The truth is Social Security needs to be fixed now. It is sound for today's seniors, but we must work together now to strengthen Social Security for our children and grandchildren. The longer we wait, the more difficult and costly it will be to fix the problem.
In 1950, there were 16 workers paying for every one beneficiary.
Today, there are about three; and when the younger workers retire, there will be only two.
But while the number of workers paying in is going down, the promised benefits are going way, way up. For instance, a 20-year-old worker today is being promised retirement benefits that are 40 percent higher than a retiree today receives from Social Security after adjusting for inflation, but the system does not have the resources to pay those promised benefits.
President Bush's plan will not change Social Security for those at or near retirement, and will not change payroll taxes but will allow younger workers to place some of their own payroll taxes in a voluntary personal retirement account - a nest egg they can call their own, government cannot take away, and they can pass on to their children.
Please stand with President Bush and get behind his plan to ensure that Social Security is there for future generations. Tell Sen. Jon Corzine and Sen. Frank Lautenberg that you're not interested in being a part of their political obstructionism when it comes to Social Security.

[engr.dr.samuel.adeniyi.ajanaku]

Tell Sen. Jon Corzine and Sen. Frank Lautenberg,BOXER,SARBANES,KERRY,KENNEDY,FEINGOLD,BINGAMA,LIEBERMAN,HARKIN,REID, I AJANAKU Won't Support Efforts To Obstruct Plans for Strengthening Social Security!
President Bush is looking to work with Democrats in confronting the challenges facing our nation, but some Democrats in Congress are looking to obstruct the President's bold second term agenda in an effort to score partisan political points even at the cost of accomplishing the business of the American people.
While President Bush is displaying leadership and following up on his campaign pledge to preserve Social Security for future generations, Sen. Jon Corzine and Sen. Frank Lautenberg should not have pessimism and negativity while presenting no plan or vision for preserving Social Security.
The truth is Social Security needs to be fixed now. It is sound for today's seniors, but we must work together now to strengthen Social Security for our children and grandchildren. The longer we wait, the more difficult and costly it will be to fix the problem.
In 1950, there were 16 workers paying for every one beneficiary.
Today, there are about three; and when the younger workers retire, there will be only two.
But while the number of workers paying in is going down, the promised benefits are going way, way up. For instance, a 20-year-old worker today is being promised retirement benefits that are 40 percent higher than a retiree today receives from Social Security after adjusting for inflation, but the system does not have the resources to pay those promised benefits.
President Bush's plan will not change Social Security for those at or near retirement, and will not change payroll taxes but will allow younger workers to place some of their own payroll taxes in a voluntary personal retirement account - a nest egg they can call their own, government cannot take away, and they can pass on to their children.
Please stand with President Bush and get behind his plan to ensure that Social Security is there for future generations. Tell Sen. Jon Corzine and Sen. Frank Lautenberg that you're not interested in being a part of their political obstructionism when it comes to Social Security.

[pgl]

Nice illustration with the two maps. But here is the thing. You and I know that this White House is playing fast and loose with the facts on this issue. Note that the American people are coming to the conclusion that this White House lies about everything. Nuf said!

[anne]

There is the answer. There will of course be no cutting of Social Security or Medicare benefits, and no privatizing of Social Security. Republicans do want to be elected again. But, the conservative attack machine has decided to invent the nonsense of a phantom Social Security problem in the future that Democrats are responsible for. Rubbish, but there we are. The differences between Republicans and Democrats are huge, for Republicans have fostered a perception of the difference for years. Phooey.

[save_the_rustbelt]

Chuckle, chuckle.

The Dems are going to deny any SS and Medicare problem until there is a major cash flow crunch and the only viable solution is to raise taxes.

The whole debate is really on about one thing, "how much of the GDP should be controled by the federal government."

Yes Bruce, I know, there is no problem and two workes can easily support one retiree in the future becuase they are going to be so productive (chasing carts around the Wal-Mart parking lot no doubt).

A pox on both parties.

[anne]

No matter, as long as Social Security and Medicare benefits are not cut. These benefits will not be cut because the country is aging rapidly enough to insure ever more powerful voter support for sustaining and strengthening the programs. Since there is a huge and growing Social Security surplus, and will be for years, there is no problem here worth worrying about for years. Of course, the economy really really is growing and there is no reason to believe there will be a Social Security problem for decades if in decades.

Medicare is part of a general health care insurance problem but there is fierce conservative resistance to looking to ways to limit increases in costs and conservatives for the time have control of Congress. However, Medicare benefits will not be cut but in time there will be increasing pressure for modifications in the program to better contain costs.

[Bruce Webb]

Hey rustbelt, if you actually did a little more examination of the numbers and a little less snark we could advance this discussion. I have read the Reports, you have absorbed a couple of Op-Eds. You quite literally do not know what you are talking about. You are implicitly defending an economic projection called "Intermediate Cost" but I seriously doubt you could cite a single economic number that underlies it.

You can chuckle, for all I care you can chortle, but in the end you are going to choke. Because not a single economist has made a single attempt to deny the implications of Low Cost. They have dodged it, but no one has made a head on assault. And the sad thing is that you probably have no idea what the hell I am talking about.

I would direct you to my site where all the numbers are laid out but you probably need to have it broken to you slowly. You can start at Rock the Vote: Social Security: Get it straight where you will find that you well and truly have been "played".

They have been lying to you. Again. Just like WMD. And you bit. "Fool me once-shame on you, fool me twice-shame on me". Don't be a fool, don't get played. And BTW this is an economist's site - bring numbers next time.

[Bruce Webb]

Anne, there are a lot of unexamined assumptions built into Medicare projections that are just as bogus as those in Social Security.

First and foremost the Medicare Trustees have simply adopted the income model of Intermediate Cost. Not surprising because they are mostly the same set of people: the Secretaries of Treasury, Labor and HHS represent half of each Board. To the extent that Intermediate Cost underestimates the dollar flow into the Social Security Trust Fund it does the same for the Medicare Trust Fund, and since there is no cap on Medicare the effect may well be greater. The fact of the matter is that once we put Social Security "crisis" to bed and turn our attention to Medicare we will see that a lot of our work is already done. In 1992 Medicare was projected to go bust by 1999, that date is now 2016. Too close for comfort but still receding.

Second there is the odd assumption that as a society we will just tolerate medical care gobbling up a higher and higher share of GDP, that at some point we will not just cry "basta" and set some limits.

Third there is the assumption that medical care will always get more expensive as it gets more advanced, that the equivalent of computer's Moore's Law will never kick in. I don't see it. Procedures that were impossible or hellishly expensive are routine today. Hospitals were pooling together to afford a single MRI machine, a kidney transplant was experimental surgery. grandma falling and breaking her hip meant a one way trip to the nursing home. The definition of "cancer survival" meant still being alive five years later. There are a lot of things converging that make medicine like home computing circa 1975-we unlocked the human genome, brace yourself.

[Bruce Webb]

And for our double posting friend

"The longer we wait, the more difficult and costly it will be to fix the problem."

You have numbers to back that? Because this table suggests the exact opposite:
EPI: Changes in Trustees projections over time
"Doing nothing. A proven winning strategy since 1996". Because that 2.19% of every dollar from then to now is still in my pocket, and the proposed fix is now cheaper going forward.

[me]

hey rustbelt

republicans predicted trillion dollar surplusses and claimed their tax cuts would pay for themselves, just like the Iraq war. Now why should we believe anything you say about issues with social security. Me thinks you have ZERO creditibilty. I suppose you believe that with 2 billion cash in the bank Delphi is bankrupt and employees need to work for 9 bucks an hour and no healthcare. Fortunately, when republicans no longer make sense, people do quit listening.

[anne]

Please understand, I am only mildly worried about the costs of Medicare but more worried about the costs of and lack of health care insurance coverage as a whole. I was pleased that drug coverage was gained through Medicare, but the structure of coverage will needlessly allow for cost increases that will in time beg additional measures both administrative and legislative. There is currently however a move to limit Medicaid coverage, that I am far more concerned about than the need for eventual tinkering with Medicare structure.

[Bruce Webb]

Oh yes Anne, they will rue the day the let the camel's nose under the tent in allowing Medicare coverage for drugs. Because we can fix this currently Big Pharma friendly program. They set the table for us, they may be totally surprised at the way the pie ends up being sliced. This is a classic case of "throw me in that Briar Patch". They opened to door, we have every opportunity of directing the flow of people coming into the lobby. For condition after condition the treatment going forward is going to be a pill or an injection rather than other kinds of treatment. And the Republican Party has opened the door for single coverage.

[dryfly]

rustbelt - we will support the elderly or we won't. How does privatization change anything? How does privatization make those 2-3 workers more able to support the elderly? It doesn't - not under any plan currently proposed.

The demographics don't change whether private or public... and the problem doesn't change... except for one thing... in a public system the gov't can't abandon the elderly and in a private system they can be abandoned... it can be their 'own fault' due to 'poor investments'.

This argument is NOT about how much taxes Dems can collect... it is about how much risk the GOP can dump on the general public so they can skate free without any 'responsibility' or 'guilt'.

The irony is the one thing the wealthy & powerful have to worry about - really worry about - is if the middle class loses all hope in the system. If that happens it isn't a long trip to tyranny - either of the left or right. And if that happens the people who put us in that situation will pay with their head. Social Security is one of the 'insurance policies' that makes sure the middle class never goes there... never gives up hope.

The people pulling the levers need to read more history.

[Dan Ryan]

Daniel from Connecticut is Daniel Gross -

http://www.danielgross.net/archives/2005/10/23-week/index.html#a000272