Tuesday, January 18, 2005

Bush Administration Plays Politics With "Neutral" Social Security Administration

The Social Security Administration, which by federal law is intended to act as a neutral body, is being used as a political tool by the Bush Administration.

According to an article in the Jan. 16 edition of The New York Times, "the Social Security Administration is gearing up for a major effort to publicize the financial problems of Social Security and to convince the public that private accounts are needed as part of any solution. The agency's plans are set forth in internal documents, including a "tactical plan" for communications and marketing of the idea that Social Security faces dire financial problems requiring immediate action. Social Security officials say the agency is carrying out its mission to educate the public, including more than 47 million beneficiaries, and to support President Bush's agenda."

"Trust fund dollars should not be used to promote a political agenda," Dana C. Duggins, a vice president of the Social Security Council of the American Federation of Government Employees, told the Times. The federation represents more than 50,000 of the Social Security agency's 64,000 workers.

Deborah C. Fredericksen of Minneapolis, who has worked for the Social Security Administration for 31 years, told the Times: "Many employees believe that the president and this agency are using scare tactics to promote private accounts."

***

In 1994, Congress passed legislation to establish a three-person, independent oversight board for the Social Security agency, removing it from the supervision of the Department of Health and Human Services, which operates as part of the politically minded White House.

The late Sen. Patrick Moynihan, the bill's author, said at the time: "With this bill we hope to increase public confidence in Social Security ... by insulating the program from politics." The bipartisan bill passed unanimously in both the House and the Senate, and was supported by such organizations as the AARP and the National Council of Senior Citizens.

***

I'm not going to get into the debate over privatizing Social Security. That debate has little to do with the point here, which is that once again, the Bush Administration is placing politics above such novel concepts as truth, or history.

In addition to abusing the independence of the agency, the Bush administration, led by president, is using factual distortions to make its case for privatization.

Bush has been saying that the system will be "broke," "bankrupt" or "flat bust" by 2042. In fact, the nonpartisan Congressional Budget Office has said that Social Security will be able to pay all benefits through 2052, and even after that date, the program will be able to pay a higher benefit than received today by retirees. Democrats have suggested that with minor changes to the tax code, the program will be solvent for several decades more.

Chris Wallace, of Fox News Sunday (of all places), played real "hardball" with White House Spokesman Dan Bartlett (who appeared on five Sunday shows on Jan. 16 to talk about Social Security). Here's an excerpt from their exchange*:

WALLACE: Let's turn if we can to another big issue, maybe the top of your legislative agenda on the domestic front: Social Security. The president keeps saying that there is a crisis, that if there is no change the system will go broke by 2042. Let's look.

BUSH (videotape): I want you to think about a Social Security system that will be flat bust, bankrupt, unless the United States Congress has got the willingness to act now.

WALLACE: As a simple fact, isn't that wrong?

BARTLETT: Absolutely not! And the bottom line is—the fact of the matter is that when you take the Social Security system as it is, this is a mathematical issue, not an ideological issue. In 1950, there were about 16 workers ...

WALLACE: Let me just interrupt, because I know the fact that there were 14 workers for every person when it was first ... The fact is that in 2042, if you did absolutely nothing to the system, it wouldn't be “broke.” It wouldn't be “bankrupt.” In fact, there would be a problem, but you would be able to still pay about three-quarters of everybody's guaranteed benefits.

BARTLETT: But what you’re talking about—in 2018 we go into the red. In 2042, you start actually bankrupting the system, which you're having to get funds elsewhere. You're right, the payroll taxes at that moment could pay about 70 percent of the benefits.

WALLACE: But that isn't “bankrupt.”

* With thanks to dailyhowler.com

***

So, the Bush Administration is wrongly asking the Social Security Administration to shill for its privatization plan, using incorrect, politically motivated math.

A Social Security agency spokesman, Mark R. Lassiter, told the Times that the agency is not using a prepared script for answering questions from the public. But, according to the Times, the agency's strategic communications plan says:

-- Spread the message that "Social Security's long-term financing problems are serious" via speeches, seminars, public events, radio, television and newspapers.
-- Social Security managers should "discuss solvency" at staff meetings, insert "solvency messages" in all Social Security publications, and spread the word at places like farmers' markets and retail stores.

Whether there's a prepared script isn't really the issue. The Bush administration has made it clear that they want their scare-tactics message to get out there, far and wide, facts be damned.

11 Comments:

Blogger Michael said...

I for one couldn't be happier that Bush has staked so much of his reputation on this ludicrous idea - that by taking money out of Social Security bonds and letting young people play the market with it we can keep the system from losing money. It's amazing they can even describe such a plan with straight faces.

With any luck this folly will be part of the Bush legacy - in the same way that Medicaid Reform is part of Hillary's.

8:12 AM  
Anonymous Anonymous said...

While I believe that the use of private accounts in some fashion should not be summarily dismissed (seems to me that if it were done correctly, it may have some use), i am utterly unconvinced it is necessary. Everyone is playing politics and i cannot figure out the truth. Best I can tell, the benefits will drop off in about 15 years but very slowly, or will need to be borrowed from elsewhere. By 2042, it will drop off 20% or something like that. Does this include increases for standard of living/inflation etc....? Someone needs to be convincing as to when the problem will begin and when it will become unfixable. Then tackle how to fix it. Pathetic.

Interesting that Fox News played hardball.....think he will get fired for questioning Bush?

Bush should have no influence over the SSA opinion and hopefully enough people will raise the issue to prevent what is happening.

11:43 AM  
Anonymous Anonymous said...

Could it be that Bush is manufacturing unwarranted fears about Social Security going bankrupt so he can rush through a proposal that would result in a windfall for his croonies in the investment banking industry?
The trillion dollar costs in making the transition would be borne on the backs of U.S. taxpayers.
It kind of reminds me how the Bush Iraq War policy has been a boon for his croonies at Haliburton, likewise at the expense of breaking backs of taxpayers.
As in the case of the healthcare industry, Bush does not appear to be below crafting policies to benefit corporations before people and saying any bullshit to the media to get his way.

1:36 PM  
Anonymous Anonymous said...

Oh yeah, let's not forget Bush's good ole Texas buddy felon Kenneth Lay and his Enron corporation -- key architects of U.S. energy policy in the early years of the Bush Administration.
Y'know the crook and his company that caused thousands of decent workers to lose their life long pensions/savings, lose their homes. This includes people I personally know in New Jersey.
Are Bush's motivations truely behind "protecting" similar common folks who work their entire lives to find their social security checks one day as valuable as an Enron stock certificate?

1:49 PM  
Anonymous Anonymous said...

The fate of our ill-fated SSA can be summed up with simple arithmetic: First, life expectancy has risen to 78 years today from 62 years in 1935, when SSA came into being. Meanwhile, fertility rates have declined to two children per woman from the baby-boom peak of 3.7. The worker/retiree ratio has fallen to 3 to 1 from 16 to 1 in 1950. The first of the baby boomers will retire in 2010. Social Security benefits will exceed payroll tax revenue in 2018. Confronting "grave and gathering threats" before they explode in downtown Manhattan is, thank God, part of the Bush docterine. Applying that successful docterine domestically is the only way to prevent the Social Security meltdown.

10:17 AM  
Anonymous Anonymous said...

Spare me the goddamned "grave and gathering threat" b.s. If this were true, Bush would be attacking Iran and North Korea among other countries, as well as Iraq.
This is one of the plain cow dung motivations behind the Iraq War fabricated by Bush after his WMD claims and terrorism links proved to be completely baseless. It can be pointed out that in his inaugural speech today, he again shifted positions. We must remember now that the reason we attacked Iraq was to spread freedom as the "only" way to fight terrorism.

1:54 PM  
Anonymous Anonymous said...

you mad as hell liberals need to get a grip. forget the rhetoric....look at the issues.

is there a SS problem. yes. when will it become an unfixable problem. i am not sure. but before it does, all possible remedies need to be considered by both sides. waiting for it to become a crisis and then trying to put out the fire will inevitably lead to poor policy. so plan now for the problem but lets be honest about the details. from what i can tell, you have dishonesty everywhere--some people say it isnt an issue, Bush saying it is a major problem front and center and the truth likely somewhere in between.

so lets move past the i hate all things bush crap and look at the issues facing the country. bush's croonies--what are we in second grade. there is such a lack of logic all over this blog recently, it has become more like a crossfire chatfest. it is sad.

i heard on air america this morning that liberals should promote and push all inaugural protest rallies, parades etc....around the country. I am not defending a tasteless inaugural, if it turns out that is the case, but let me understand the logic. liberals upset with the amount of money being spent on the inaugural (when it could better be used elsewhere as i have heard) are now suggesting spending more to protest it. logic out the window.

hopefully liberals will get drunk on Bushs newest tax increase (yes increase) idea---eliminating the deduction for state taxes on federal returns. what a nasty unfair tax increase that is--- here is a real issue to discuss but no, lets discuss condi rices hairstyle (another beautiful air america moment), the inaugural etc...

3:00 PM  
Blogger Michael said...

Umm... changing the subject isn't actually an answer. Try some research, cite some data with actual references we can check for ourselves (or laugh at, as the case may be). An "unfixable meltdown"? According to whom?

Here's some facts:

-- Social Security currently takes in more money than it pays out, while it pays nearly half a trillion dollars a year to about 47 million retirees and other recipients.

-- In the worst possible scenerio, by 2018 the system will begin paying out more in annual benefits than it takes in from payroll taxes.

-- Around 2042, according to the most conservative estimates, the system's current surplus will be exhausted and it will be forced to rely exclusively on annual revenue from workers and their employers, even then Social Security will still be able to meet almost three-quarters of its yearly financial obligations.

Now let's do some reasoning here - suppose we were to raise the benefits age by a few years (as you point out people are living longer) so that the retirement age was 67 or more; or suppose we raise the payroll tax from 6.2 percent to 7.5 percent? Gosh, "meltdown" doesn't happen!

Amazing isn't it? But isn't that just such boring accounting? Who wants to talk about numbers when it is it so much more exciting to partially privatize one of the most successful Democratic New Deal programs? Boy, I bet the Wall Street Brokerage Firms are just salivating at the very suggestion that they could get their hands on our tax money!

The only way to get intelligent people to buy the story that the "only way" to save the Social Security is to create a mammoth new government program and take money out of the safe government bonds to gamble on the stock market, is to invent pnoney scare tactics about a "bankrupt" system in danger of inevitable meltdown. But I guess Bush already figured that out!

5:12 PM  
Anonymous Anonymous said...

While I agree the "crisis" is not imminent, it is a large problem. The system will no longer work if the status quo is maintained and clearly, the longer we wait to fix it, the more difficult a problem it will be to fix. All possibilities should be reviewed. The above blogger implies that the answer is simplistic when it is not. I am not necessarily a proponent of private accounts but i am a huge proponent of analyzing this now and putting forward some solid plans. I hope different groups or committees in congress and elsewhere do so.

Yes, you can add years to retirement age to make up for part of the shortfall. But at what point do you do this---how much have people close to retirement relied upon this. And if you recognize the problem today, is it fair to wait to make the change to "protect" those closer to retirement age at the expense of younger people.

Yes, you can increase the employment tax. But this is a regressive tax that already unfairly burdens the poor and middle class. So you would be increasing the burden. Add this to the proposal to do away with state tax deductions for federal purposes, the increasing alternative min tax problem---and you are seriously overtaxing the middle class which is a bigger problem than saving social security if you ask me (ramifications to the economy could be horrific).

You could change the way benefits are paid out--maybe some people wouldnt be eligible anymore but then of course, the argument would be that they paid in all their lives to get nothing back.

In any event, the problem must be dealt with but lets not kid ourselves. The New Deal system, as presently constructed, will no longer work with an aging population and baby boomer retirements. Privatizing is not necessarily the solution. But ignoring it is a bad idea. This is a complex issue, not a simple one.

5:44 PM  
Anonymous Anonymous said...

This comment has been removed by a blog administrator.

5:44 PM  
Blogger Michael said...

And of course that is my point, and the point of the original post precisely. The Bush administration is clearly trying to promote a program based on politics, not sound financial reasoning. How the numbers get tweaked is exactly what I propose our government should be discussing, but I fear they are not. Much like 9/11 they see a problem and smell an opportunity to advance an unrelated cause they always wanted to persue, but never had cover to.

7:41 PM  

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