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Commentary :: DNC : Globalization : Labor : Politics : Social Welfare
The Social Security Distraction Game
12 Mar 2005
So what's all this hoopla about Social Security? Even the Government Accountability Office (GAO) has stated that "Social Security does not face an immediate crisis, but it does face a large and growing problem," and that private accounts will only "accelerate the date for when it will start spending more on pension benefits than it receives in annual revenue." The GAO clearly stated that the problem lies primarily in where funding will come from to continue paying out to the disabled and retirees as promised.

To understand the problem, we first need a better understanding of the Social Security system itself. The poorly named Social Security "trust fund" is not some huge vault with cash inside that the government writes checks against to pay recipients. Social Security is not insurance, it's a tax. When these taxes are collected, they are put in the general fund, and are used to pay for a majority of current benefit recipients, as well as other government programs, both constitutional and unconstitutional. Currently, the government needs to "find" more than $400 million every year to pay for social security. So the money each one of us puts into the Social Security "fund" is actually used to pay for current benefits and other programs. At no time do our taxes, whether in the "fund" or in "private accounts" go anywhere that money can actually be accessed.

Logically speaking then, any money put into a private account, such as under Bush's scheme, is actually a government loan. If your account does really well, (>3%) when you retire, the government will deduct the amount it lent you, plus 3% interest, from your monthly benefits check, leaving you with almost the same amount as under the current system. If your account does poorly, you're completely out of luck. According to the Congressional Budget Office (CBO), the expected average rate of return is 3.3%, so the net gain will be zero or slightly higher. On the other hand, the net gain to the rich and powerful will be huge. Wall Street expects to make about $1 trillion on the investment of Social Security funds. The result? Greater risk to the People, and a huge guaranteed payout to the corporate rulers of America.

Hopefully, you're with me at this point in opposition to these so-called "private accounts." If not, let's examine some case history of a very similar program, which Bush has cited as a model for his current plan - Chile's retirement program. Nearly 25 years ago, Chile began an experiment in which millions of people began to pay 10% of their salaries to private investment accounts for retirement benefits. Now that the first generation of workers in this system is beginning to retire, Chileans are learning that this program is delivering much less than what was "advertised" by American-backed dictator, Augusto Pinochet. Many people who stayed in the old system are now earning nearly double what the new private account system is paying out, mainly due to high commission rates.

So, Bush has proposed a system that the GAO says won't fix problems and will accelerate the bankruptcy of the program, that the CBO says won't give a higher return, that Wall Street will get richer from, and that the only similar model (which was instituted by a murderous dictator), is failing. If you still are in favor of these private accounts, you'd better stop reading, and go back to your network television.

Conversely, proponents (officials and their big-media propagandists) of this destructive private account plan have been demanding that opponents (mostly Democrats) come up with an alternative. While most will not argue that the system is impervious to destruction, to force a debate on the solvency of a program that has, in many expert's minds, at least 50 more years of effectiveness, is nothing more than ambush politics and grandstanding.

The crux of the problem is that Social Security cannot last forever in its current state. Obviously, private accounts will do more harm than good, but are opponents coming up with anything to save the system? Of course not. Rather than discussing real solutions to the problems we face, they only stand in opposition to Bush's proposal. The solution is simple, and it's becoming clearer every day that neither side of the political spectrum has any interest in the solution. They only want to continue this debate to keep us distracted from everything else that both Democrats and Republicans are supporting (endless billions of funding for the Iraq war, heightened war tensions with more countries, expansions of the P.A.T.R.I.O.T. Act, National ID cards, slowly eliminating free speech, a dying economy, and much more).

Do you remember that $400 million that the government needs to "find" each year to pay for benefits? Well, that's just about the same amount that the unconstitutional NAFTA has wiped out in excise taxes. How about the nearly $82 billion that both Democrats and Republicans support for additional Iraq war funding? So, while corporations like Halliburton and Bechtel and the rest, get endless billions in war profits, and corporations like General Motors save millions by relocating to Mexico and not having to pay excise taxes, essential benefits for people are left behind. Do we really need more evidence as to who the government is interested in? Think of how many times you've heard either Republicans or Democrats talk about taking money that we already have, and using it to pay for Social Security benefits, rather than corporate benefits. Not too often, I'm sure.

Here's a simple solution, taken right from the business world. Prioritize. Is it a radical solution to actually let American citizens create a priority "list" for federal funds? Obviously the government has already done so, and we painfully know what it is. We continually hear how it's important to "create a good business climate," or "defend freedom around the world," or "expand free trade," but with the wisdom of looking at history, who does that really benefit? Corporations, and corporations only. "Free trade" cuts corporate tax revenue, and puts a greater burden on the People. A "good business climate" always favors none other than big business, and "defending freedom" has done nothing but help install pro-American puppet governments, and cause the deaths of countless people, from our country and elsewhere.

America is supposedly a Democracy, although this really is not true. So how about this radical idea? Maybe America should act more like a democracy and let the people, as a whole, decide how we'll spend our money, instead of these compromised rich politicians who run the country, telling us how they've decided to spend it. Obviously, that current fascist system is proving to be a success for big business, and a failure for the people.

Would it be so strange to come up with a budget? Would it be so strange to look at how much money we have available, list what we need to spend money on in order of importance, and spend only the amount that we have available? If that were the system, do you think many people would be interested in taking money from schools, healthcare, roads, infrastructure, and the like, and pour it into the military machine? Do you think that people would be more interested in giving tax breaks to corporations than ensuring a safety net for their parents, their grandparents, and themselves? The solution to the problem of Social Security is simple, and it's the same solution for all our financial problems. A budget controlled by the people, rather than by corporate interests, is the solution. Democrats and Republicans alike never talk about cutting military budgets, or corporate welfare, or anything like it, they only refer to cutting our benefits. If we have the money to pay for all these other things, we obviously have the money to pay for Social Security. The government's priorities are just screwed up. Only when we start talking about using our wealth where it's needed can we have a solution. Only when the military and the corporations start taking a few cuts, can we keep our promise help pay for the needs of the People in their waning years.

The economy is out of control, as we can barely pay for the interest on our outstanding debt. The dollar is crashing, jobs are being lost, and America is turning into a nation that only services foreigners, and no longer produces its own goods - even though we have the capacity to do so. Social Security isn't our only financial problem, although the politicians and pundits would like us to think so. It's time we start running our own government, and start indicting those who have been pushing us on the path to financial ruin.

Has everyone forgotten that taxes are our money? Don't forget, as strange as it sounds, the White House has absolutely no Constitutional authority to submit a budget. Only the House of Representatives does. "No taxation without Representation!" Remember that phrase from your history books? The government forces us to pay taxes, and they don't allow us to control how we, as a nation, spend it.

Sounds like slavery to me.

Sounds like it's time for the People to start running America, and not the corporations.
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