"Goverment Motors"

[OperaTenor]

Strengthening Social Security For The 21st Century

I haven't had time to re-read it. I ask again, what documents form the basis for your understanding of the plan goals?

What are talking about? My understanding stems directly from my reading of the document.

You've never read it in the first place. If you have, this is the first you've said it.

[Shapley]

Where did you read it? The summary I just posted is all I found on a quick search. I found several references to it and testimony regarding it, all of which state that the plan hasn't been finalized, and is only offered in a series of changing 'outlines'. I've read the outline, as I noted, and provided a link. You say you've read the plan, but you haven't provided a link so I can do likewise. I did provide a link to the actual bills proposed by Congress and the Senate, the ones you said didn't exist, as well as 'facts and myths' link that identifies those bills as the President's proposed version. I've not read them, so I can't attest as to whether or not they are the same. I've read various proposals and commentaries on proposals regarding privatization, so it is entirely possible that I have confused one by the Heritage Foundation or the Cato Institute with the President's proposal. I don't pretend to have a photographic memory, but I do attempt to support my statements with valid links.

[Shapley]

Here is Wikipedia's entry on the Social Security debate. Here is the section dealing with President Bush's proposal:

George W. Bush's privatization proposal
President George W. Bush discussed the "partial privatization" of Social Security since the beginning of his presidency in 2001. But only after winning re-election in 2004 did he begin to invest his "political capital" in pursuing changes in earnest.

In May 2001, he announced establishment of a 16-member bipartisan commission "to study and report specific recommendations to preserve Social Security for seniors while building wealth for younger Americans", with the specific directive that it consider only how to incorporate "individually controlled, voluntary personal retirement accounts".[60] The majority of members serving on Bill Clinton's similar Social Security commission in 1996 had recommended through their own report that partial privatization be implemented.[2] Bush's Commission to Strengthen Social Security (CSSS) issued a report in December 2001 (revised in March 2002), which proposed three alternative plans for partial privatization:

Plan I: Up to two percent of taxable wages could be diverted from FICA and voluntarily placed by workers into private accounts for investment in stocks, bonds, and/or mutual funds.
Plan II: Up to four percent of taxable wages, up to a maximum of $1000, could be diverted from FICA and voluntarily placed by workers into private accounts for investment.
Plan III: One percent of wages on top of FICA, and 2.5% diverted from FICA up to a maximum of $1000, could be voluntarily placed by workers into private accounts for investment.[61]
On February 2, 2005, Bush made Social Security a prominent theme of his State of the Union Address. In this speech, which sparked the debate, it was Plan II of CSSS's report that Bush outlined as the starting point for changes in Social Security. He outlined, in general terms, a proposal based on partial privatization. After a phase-in period, workers currently less than 55 years old would have the option to set aside four percentage points of their payroll taxes in individual accounts that could be invested in the private sector, in "a conservative mix of bonds and stock funds". Workers making such a choice might receive larger or smaller benefits than if they had not done so,[citation needed] depending on the performance of the investments they selected.

Although Bush described the Social Security system as "headed for bankruptcy," his proposal would not affect the projected shortfall in Social Security tax receipts. Partial privatization would mean that some workers would pay less into the system's general fund and receive less back from it. Administration officials said that the proposal would have a "net neutral effect" on the system's financial situation, and that Bush would discuss with Congress how to fill the projected shortfall.[62] The Congressional Budget Office had previously analyzed the commission's "Plan II" (the plan most similar to Bush's proposal) and had concluded that the individual accounts would have little or no overall effect on the system's solvency, and that virtually all the savings would come instead from changing the benefits formula.[63]

As illustrated by the CBO analysis, one possible approach to the shortfall would be benefit cuts that would affect all retirees, not just those choosing the private accounts. Bush alluded to this option, mentioning some suggestions that he linked to various former Democratic officeholders. He did not endorse any specific benefit cuts himself, however. He said only, "All these ideas are on the table." He expressed his opposition to any increase in Social Security taxes. Later that month, his press secretary, Scott McClellan, ambiguously characterized raising or eliminating the cap on income subject to the tax as a tax increase that Bush would oppose.[64]

In his speech, Bush did not address the issue of how the system would continue to provide benefits for current and near-future retirees if some of the incoming Social Security tax receipts were to be diverted into private accounts. A few days later, however, Vice-President Dick Cheney stated that the plan would require borrowing $758 billion over the period 2005 to 2014; that estimate has been criticized as being unrealistically low.[65]

On April 28, 2005, Bush held a televised press conference at which he provided additional detail about the proposal he favored. For the first time, he endorsed reducing the benefits that some retirees would receive. He endorsed a plan from Robert Pozen, described below in the section regarding suggestions for Social Security that do not involve privatization.

Although Bush's State of the Union speech left many important aspects of his proposal unspecified, debate began on the basis of the broad outline he had given.


[edit] Politics of the dispute over Bush's proposal
The political heat was turned up on the issue since Bush mentioned changing Social Security during the 2004 elections, and since he made it clear in his nationally televised January 2005 speech that he intended to work to partially privatize the system during his second term.

To assist the effort, Republican donors were asked after the election to help raise $50 million or more for a campaign in support of the proposal, with contributions expected from such sources as the conservative Club for Growth and the securities industry.[66] In 1983, a Cato Institute paper had noted that privatization would require "mobilizing the various coalitions that stand to benefit from the change, ... the business community, and financial institutions in particular ..."[67] Soon after Bush's State of the Union speech, the Club for Growth began running television advertisements in the districts of Republican members of Congress whom it identified as undecided on the issue.[68]

A group backed by labor unions called "Americans United to Protect Social Security" "set its sights on killing Bush’s privatization plan and silencing his warnings that Social Security was 'headed toward bankruptcy.'” [69] Americans United to Protect Social Security later changed its name to Americans United for Change and rallied behind Obama's proposed 2009 economic stimulus bill.[69]

On January 16, 2005, the New York Times reported internal Social Security Administration documents directing employees to disseminate the message that "Social Security's long-term financing problems are serious and need to be addressed soon," and to "insert solvency messages in all Social Security publications".[70]

Coming soon after the disclosure of government payments to commentator Armstrong Williams to promote the No Child Left Behind Act, the revelation prompted the objection from Dana C. Duggins, a vice president of the Social Security Council of the American Federation of Government Employees, that "Trust fund dollars should not be used to promote a political agenda."

In the weeks following his State of the Union speech, Bush devoted considerable time and energy to campaigning for privatization. He held "town meetings" at many locations around the country. Attendance at these meetings was controlled to ensure that the crowds would be supportive of Bush's plan.[citation needed] In Denver, for example, three people who had obtained tickets through Representative Bob Beauprez, a Republican, were nevertheless ejected from the meeting before Bush appeared, because they had arrived at the event in a car with a bumper sticker reading "No More Blood for Oil".[71]

Opponents of Bush's plan have analogized his dire predictions about Social Security to similar statements that he made to muster support for the 2003 Invasion of Iraq.[72]

A dispute between the AARP and a conservative group for older Americans, USA Next, cropped up around the time of the State of the Union speech. The AARP had supported Bush's plan for major changes in Medicare in 2003, but it opposed his Social Security privatization initiative. In January 2005, before the State of the Union Address, the AARP ran advertisements attacking the idea. In response, USA Next launched a campaign against AARP. Charlie Jarvis of USA Next stated: "They [AARP] are the boulder in the middle of the highway to personal savings accounts. We will be the dynamite that removes them."[73]

The tone of the debate between these two interest groups is merely one example among many of the tone of many of the debates, discussions, columns, advertisements, articles, letters, and white papers that Bush's proposal, to touch the "third rail," has sparked among politicians, pundits, thinktankers, and taxpayers.

Immediately after Bush's State of the Union speech, a national poll brought some good news for each side of the controversy.[74] Only 17% of the respondents thought the Social Security system was "in a state of crisis", but 55% thought it had "major problems". The general idea of allowing private investments was favored by 40% and opposed by 55%. Specific proposals that received more support than opposition (in each case by about a two-to-one ratio) were "Limiting benefits for wealthy retirees" and "Requiring higher income workers to pay Social Security taxes on ALL of their wages". The poll was conducted by USA Today, CNN, and the Gallup Organization.

Bush's April press conference, in which for the first time he expressly endorsed benefit reductions, sparked disagreement about where the burden would fall. Bush referred to "people who are better off".[75] Many media summaries accepted the characterization that "wealthy" retirees would be affected, and that benefits for lower-income people would grow.[76] Opponents countered that middle-class retirees would also experience cuts, and that those below the poverty line would receive only what they are entitled to under current law.[77] Democrats also expressed concern that a Social Security system that primarily benefited the poor would have less widespread political support.[78] Finally, the issue of private accounts continued to be a divisive one. Many legislators remained opposed or dubious, while Bush, in his press conference, said he felt strongly about the point.

Despite Bush's emphasis on the issue, many Republicans in Congress were not enthusiastic about his proposal. In late May 2005, House Majority Whip Roy Blunt listed the "priority legislation" to be acted on after Memorial Day; Social Security was not included.[79] In September, some Congressional Republicans pointed to the budgetary problems caused by Hurricane Katrina as a further obstacle to acting on the Bush proposal.[80] Congress did not enact any major changes to Social Security in 2005, or before its pre-election adjournment in 2006.

During the campaigning for the 2006 midterm election, Bush stated that reviving his proposal for privatizing Social Security would be one of his top two priorities for his last two years in office.[81] In 2007, he continued to pursue that goal by nominating Andrew Biggs, a privatization advocate and former researcher for the Cato Institute, to be deputy commissioner of the Social Security Administration. When the Senate did not confirm Biggs, Bush made a recess appointment, enabling Biggs to hold the post without Senate confirmation until December 2008.[82] During his last days in office, Bush said that spurring the debate on Social Security was his most effective achievement during his presidency.[83]


[edit] Other concerns about Social Security
Some[84] allege that George W. Bush is opposed to Social Security on ideological grounds, regarding it as a form of governmental redistribution of income to the wealthy, which other groups such as libertarians strongly oppose.[85] Some of the critics of Bush's plan argued that its real purpose was not to save the current Social Security system, but to lay the groundwork for dismantling it. They note that, in 2000, when Bush was asked about a possible transition to a fully privatized system, he replied: "It's going to take a while to transition to a system where personal savings accounts are the predominant part of the investment vehicle. ... This is a step toward a completely different world, and an important step."[86] His comment is consonant[citation needed] with the Cato Institute's reference in 1983 to a "Leninist strategy" for "guerrilla warfare" against both the current Social Security system and the coalition that supports it."[87]

Critics of the system, such as Nobel Laureate economist Milton Friedman, have said that Social Security redistributes wealth from the poor to the wealthy.[4][88] Workers must pay 12.4%, including a 6.2% employer contribution, on their wages below the Social Security Wage Base ($102,000 in 2008), but no tax on income in excess of this amount.[5] Therefore, high earners pay a lower percentage of their total income, resulting in a regressive tax. Others would argue the tax is a flat tax. The benefit paid to each worker is also calculated using the wage base on which the tax was paid. Changing the system to tax all earnings without increasing the benefit wage base would result in the system being a progressive tax.

Furthermore, wealthier individuals generally have higher life expectancies and thus may expect to receive larger benefits for a longer period than poorer taxpayers, often minorities.[6] A single individual who dies before age 62, who is more likely to be poor, receives no retirement benefits despite years of paying Social Security tax. On the other hand, an individual who lives to age 100, who is more likely to be wealthy, is guaranteed payments that are more than he or she paid into the system.[7]

A factor working against wealthier individuals and in favor of the poor with little other retirement income is that Social Security benefits become subject to federal income tax based on income. The portion varies with income level, 50% at $32,000 rising to 85% at $44,000 for married couples in 2008. This does not just affect those that continue to work after retirement. Unearned income withdrawn from tax deferred retirement accounts, like IRAs and 401(k)s, counts towards taxation of benefits.

Still other critics focus on the quality of life issues associated with Social Security, claiming that while the system has provided for retiree pensions, their quality of life is much lower than it would be if the system were required to pay a fair rate of return. The party leadership on both sides of the aisle have chosen not to frame the debate in this manner, presumably because of the unpleasantness involved in arguing that current retirees would have a much higher quality of life if Social Security legislation mandated returns that were merely similar to the interest rate the U.S. government pays on its borrowings.[89]

[OperaTenor]

Where did you read it? The summary I just posted is all I found on a quick search. I found several references to it and testimony regarding it, all of which state that the plan hasn't been finalized, and is only offered in a series of changing 'outlines'. I've read the outline, as I noted, and provided a link. You say you've read the plan, but you haven't provided a link so I can do likewise. I did provide a link to the actual bills proposed by Congress and the Senate, the ones you said didn't exist, as well as 'facts and myths' link that identifies those bills as the President's proposed version. I've not read them, so I can't attest as to whether or not they are the same. I've read various proposals and commentaries on proposals regarding privatization, so it is entirely possible that I have confused one by the Heritage Foundation or the Cato Institute with the President's proposal. I don't pretend to have a photographic memory, but I do attempt to support my statements with valid links.

Yes I did. It's in the Social Security thread from way back when. GC originally linked.

Quit wiggling. It's making me dizzy.

You're cracking me up all over again. Wiki's the unimpeachable resource for you, but not for me?

[Shapley]

You're cracking me up all over again. Wiki's the unimpeachable resource for you, but not for me?

Where did I call it 'unimpeachable'. It was the most comprehensive source. That does not make it the most accurate, or even remotely accurate. They do provide a list of sources, however, which can be further searched if you have the time. I don't.

[OperaTenor]

No, the most comprehensive source is the document itself. You know, the one you refuse to read so you can stay securely on the river bank.

No time? If you took all of the time you've spent bobbing and weaving in posts here about not reading it collectively, you could have read the thing three times, at least.

[Shapley]

I can't read it if I can't find it.

I read through the first seven pages of the Social Security thread, and found a link to this:

The President's Commission On Strengthening Social Security. GC's original link to the document is dead, but this one is active. It provides three alternatives for fixing the Social Security which are summarized, accurately or not, in the Wikipedia article I linked. These are not the President's proposals, but rather proposals made to the President, so I still don't know if this is the document you are referring to. So far, all Ive found actually proposed by the President is the outline I've read and posted, and the State of the Union speech discussed by Shos in the thread.

[OperaTenor]

Yes, that's it. It was GWB's commission, so it's his proposal.

Here is the document itself: PDF

Happy reading!

[Shapley]

It was GWB's commission, so it's his proposal.

Interesting...

[Shapley]

The President’s Principles

The President directed the Commission to propose Social Security reform plans that will strengthen Social Security and increase its fiscally sustainability, while meeting several principles:

• Modernization must not change Social Security benefits for retirees or near-retirees.
• The entire Social Security surplus must be dedicated to Social Security only.
• Social Security payroll taxes must not be increased.
• Government must not invest Social Security funds in the stock market.
• Modernization must preserve Social Security’s disability and survivors components.
• Modernization must include individually controlled, voluntary personal retirement accounts,
which will augment the Social Security safety net.

[Shapley]

No time? If you took all of the time you've spent bobbing and weaving in posts here about not reading it collectively, you could have read the thing three times, at least.

Your attacks on my character are tiring. I've neither bobbed nor weaved, I've merely asked where this document could be found so I could read it. Now I find out it is not a document offered by the President, but rather one offered to him by his commission. That is not the same thing. I have read the executive summary of this document, as I noted earlier, as well as commentaries on it. I will be happy to peruse it in the near future, although I fail to see the reasoning for doing so, since the President who commissioned it is no longer in power and the President currently in power applauded its demise.

[OperaTenor]

I'll take that as an "I give up."

[Shapley]

I'll take that as an "I give up."

If that is your fantasy...

[OperaTenor]

You're the one who doesn't have firsthand, thorough knowledge of the document, yet refuses to bone up on it in order to try support your fallacious argument, so yeah, you give up. The only fantasy is your impression of what the document says.

IIRC, you never read the 9/11 Commission Report, either.

[Shapley]

You're the one who doesn't have firsthand, thorough knowledge of the document, yet refuses to bone up on it in order to try support your fallacious argument, so yeah, you give up. The only fantasy is your impression of what the document says.

My point is that the document offers three possible options, none of which appears at first glance to do what you said the President proposes. Additionally, there is no indication that what the President did propose is directly reflected by any of the three proposals in the document. So far as I know, the only real indication of what the President had proposed was contained in the State of the Union Address, and the only accurate reflection of the Republican interpretation of that plan is indicated in the two bill submitted at the time, which you said did not exist and which I have linked on site. The commission report is their suggestions, and does not necessarily reflect the President's goals. Reading it at this point appears to be meaningless, except to satisfy your desire to flog a long-deceased horse.

I disagree that the President intended to inflate corporate coffers with a 'steady stream of tax dollars'. That is you interpretation. I sincerely doubt that it is spelled out in that manner in the document, and you've provided no indication that it is. It is your interpretation of the intents of the commission that proposed a solution to a president who may or may not have been suggesting that solution when he addressed the nation about the need to fix the system. How does my reading the document resolve that?

[OperaTenor]

There you go again....

You don't know how it's "spelled out" in the document, so you have no basis for interpretation. I've read it, and I'm telling you it was nothing but a path for tax money to go straight to Wall Street.

[Shapley]

There you go again....

If you want to support your claim, why not post a quote directly from the document that does so? I seriously doubt that my reading of the document will lead me to the same conclusion as you have apparently drawn...

[OperaTenor]

There you go again....

If you want to support your claim, why not post a quote directly from the document that does so? I seriously doubt that my reading of the document will lead me to the same conclusion as you have apparently drawn...

Because it's all over within it. There are no 'quote-bites' that encapsulate the message.

I know you'd much rather argue than learn, but if you want to treat with me on this subject any further, you're gonna need to curl up with that document and get back to me.

I'm done.

[Shapley]

I know you'd much rather argue than learn, but if you want to treat with me on this subject any further, you're gonna need to curl up with that document and get back to me.

I have the document downloaded. I may read it. I'll read through the start of it, but I doubt it will say more than is encapsulated in the executive summary.

[OperaTenor]

And that's a poor assumption. The devil is truly in the details in this case.