Friday, October 22, 2004

Valuable Debate

I know I stated a couple of entries ago that I had made up my mind to be a single-issue voter this year. Since writing that, I received a couple of emails dealing with another issue concerning the Bush administration. The first quote was the catalyst for the second. The rebuttal was researched and written by my sister-in-law, Mary Martin, who is a CPA, mother of three, practicing Catholic, and lives in the heartland.

"False: Social Security Privitiazed.. Bush wants young people to take a third of SS to invest on their own. I think it odd, that the elders are so concerned about the deficit to our children, while at the same time holding their hands out because they deserve it. come on, I thought Algore was supposed to rid us of those $85.00 hammers..guess not. We can't support the growing numbers. I am in the baby boomer range, yet now I have to wait until I am 67 to claim benefits."


"Let me address Social Security today. Since 1985 (could be 1984, sorry, I left my research at home), Social Security taxes collected have been more than Social Security benefits paid. But because of budget deficits, this "surplus" in Social Security has been used to reduce the deficit in the general budget. During the last administration, our deficits were turned to surpluses. The theory was to continue with this budget surplus, thereby having the funds available to "pay back" amounts that were "borrowed" from the fund in prior years, and have the money available to pay the benefits promised. Now, with our $400,000,000+ annual deficit, thats no longer possible.

About a month ago, Newt Gingrich wrote an editorial in the St. L. Post-Dispatch touting the plan to establish private accounts for younger workers as the means to save the system. This plan allows younger workers to take a portion of their Social Security taxes and invest it in private accounts. Here's my problem with that theory: if $X is not going to be enough to pay benefits, how can $X - $Y possibly be enough? And with these huge deficits, there's no extra money to divert to paying benefits due to our present and future retirees. The beauty of Social Security has always been sharedrisk, shared benefit. If private investment is such a good idea (and I do not disagree with that), I would be in favor of allowing the government to invest the Social Security surplus in the private sector. Current law does not allow this. If the SS surpluses since the mid-eighties had been invested well, we wouldn't even be having this conversation.

"The News Hour on PBS did a very good job of describing this situation in a clear, easy to understand manner. I refer you to Try to listen to the segment, rather than just reading the text, if you can. I found it extremely disturbing to learn that the "lock box" is simply a file cabinet filled with IOUs, and that our national debt is close to exceeding our national net worth.

"The fiscal irresponsibility of the present administration takes my breath away. Giving away the surplus is one thing, although, as I pointed out earlier, that surplus would have averted a crisis in Social Security for many years. But to have a further tax cut, to charge a lower tax rate in dividend income, is the incomprehensible to me. (In my mind, it's like you or I saying, "Well, this year is going to be expensive. Our oldest is off to college, I need surgery and will be off work for 3 months, and the shed blew down during the last storm. So I think I'll ask my boss for a reduction in pay and live off credit cards.") I have heard that 2/3 of our present deficit is due to the tax cuts passed during this administration."

I love well-presented arguments researched and written by people who know what they are talking about. As I said before, the practical, fiscal wrangling of the campaign literally makes my head spin. I have no head for things like that. This put one aspect of the Bush Administration's failure into terms that I could understand. I'm posting it here in hopes that it will prove a similar help to others.


  1. Your sister is a freakin genius!!!!!  I actually knew most of that but trying to explain it all without using geek-speak is daunting at its best.  

    I hope everyone reads this...I WILL be pimping you today....

  2. Lisa, Thanks for some Plain talk about a very important issue, why can't our politician speak this language???????

  3. Very well said Lisa! I have been working since I was seventeen. I am fully elligible, as I now exist, for SS. I've been paying into it for twenty years. I'm not foolish. I don't expect it to completely support me should I ever retire. But, I didn't pay into it in order to never see a dime. If Bush is re-elected, that will surely be the case. He sounds like he is back peddling on this issue but if you listen closely he says that seniors will have social security. What about the rest of us?
    :-) ---Robbie

  4. Okay I am reading this entry and to be honest I really am just getting into the whole issue. You hoped this would help.....and it did. I am still not totally clear on everything but this did clear somethings up for me. I would like to invite you to read my journals and a journal that introduces my new online book club I hope to see you there as you will see me here.


  5. Your sister-in-law knows her stuff.

  6. Okay, so what is the answer?  Rolling back tax cuts  to save SS will stiffle an already sluggish economy taking more folks outta work and retiree/ worker ratio narrows even more.  I think that ratio is more to blame than anything else.  Kristi, School Secretary, Mother of three, faithful Methodist and born, raised and still residing in the beautiful, Conservative South, thank goodness.   :-)

  7. Kristi--Your comment sidesteps the issue.  The point is that President Bush proposes to take even MORE money away from Social Security, by "allowing young people" to take 1/3 of what would be their contributions, and invest privately.  We already know that SS is in trouble., would taking even more money away from it be any help at all?  You and I might be able to plan for the fact that Social Security will not be around when we retire.  But what about the folks who are looking at retiring NOW, or a couple years from now...made contributions all their lives, and were depending upon it to provide at least SOME of their retirement income?  These are the folks who have already been hit by the stock market tank and the loss of thousands of dollars in privately invested money.
    AND, BTW, if you're allowing that the current economy is "sluggish," you're as much as admitting that Mr. Bush's economic policies have not worked...  Lisa  :-]

  8. Paying taxes is a major form of expressing American patriotism.  People who cheat on taxes and do not pay their fair share are deficient in patriotism and are traitors.  They deserve public ridicule and excessive scorn.  I think people who do not support a fair share American tax obligation should be excommunicated and/or sentenced to death as a traitor.  

    Hey George Bush, Dick Cheney, and Kenneth Lay, Estonia is looking for a new administration.


  9. Lisa:  I just found where you responded to my comment.  This is what I said:  

    Okay, so what is the answer?  Rolling back tax cuts  to save SS will stiffle an already sluggish economy taking more folks outta work and retiree/ worker ratio narrows even more.  I think that ratio is more to blame than anything else.

    If you notice, I said nothing about SS being privatized.  What I did say was not repealing tax cuts so folks have the expendable income to drive the economy, especially the upper bracket who use their wealth to create more jobs thus helping out the worker/retiree ratio.  

    As far as the economy, it is old news that its sluggishness was a gift from Clinton, occuring during the last 12 to 18 months of his presidency.  We are feeling some upswing now, thanks to Bush and I would hope things will continue to improve.  

    I have about come to the conclusion that there is no happy medium between the National Debt and economy; it always seems that both will never be good at the same time.