Republicans Revisit Social Security Strategy

[sabra]

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http://online.wsj.com/public/article/0,,SB111896894746162181-Jrfb35cFKlHJSTPMkOijO8REE8M_20060616,00.html?mod=tff_main_tff_top

Republicans Revisit Social Security Strategy

As Overhaul Prospects Dim,
Lawmakers Consider Alternatives
To Salvage a Partial Victory

By JACKIE CALMES
Staff Reporter of THE WALL STREET JOURNAL
June 17, 2005

Congress's Republican leaders, convinced they are staring into the jaws of defeat on overhauling Social Security, are scrambling for an alternative approach to President Bush's top domestic priority that would allow him -- and them -- to seize some measure of victory.

In coming weeks, the separate efforts of Senate Finance Committee Chairman Charles Grassley and House Ways and Means Committee Chairman Bill Thomas will determine whether even that is possible, numerous Republicans say. What has become clear after months of meetings with Republicans on their respective panels, however, is that their packages won't include Mr. Bush's proposal for personal accounts carved from Social Security payroll taxes and may not meet his demand to keep the program solvent.

The two plans are still emerging but have several common concepts. Both would reduce future benefits for all but the poorest workers, much as Mr. Bush proposes. Both would raise the retirement age for full benefits, contingent on increases in Americans' lifespans. Both want to avoid raising payroll taxes.


But both chairmen have given up on finding enough Republican votes, in the face of Democratic opposition, to pass Mr. Bush's proposal to let workers born in 1950 and after divert a third of the 12.4% Social Security payroll tax to private accounts, in return for reduced regular benefits. With Republicans including House Speaker Dennis Hastert of Illinois balking at having to vote for unpopular benefit trims, Mr. Bush's demand for "permanent solvency" for Social Security also is increasingly unlikely to be met.


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[Beetwasher]

1. They Are Hanging By Their Fingertips On A Cliff W/ SS and The Dems Need

To step on their hands and kick dirt in their eyes. Dems better not give a fucking inch.

[Iowa]

2. Well said! (n/t)

[papau]

3. I agree - if no wage base cap removal, then no Dem votes

I hope the Dems in Congress have the spine for the above.

[sadiesworld]

5. We don't have an SS problem, we have a debt problem.

There is absolutely no reason for dems to allow the rethugs to spin *'s deficit mess into a problem with SS.

[struggle4progress]

18. Bingo. eom

[Iowa]

7. Yep, I write to my doofus, worthless Senator,

Charles Grassley, on a regular basis. I told him that very thing yesterday. Forget benefit cuts and raising the retirement age! Raise the cap, nix all the give-aways to the wealthy, and STOP SQUANDERING BILLIONS ON THE IRAQ FIASCO!!!

[sadiesworld]

8. Why raise the cap?

The only reason they will do such a thing is to cover their theft of the surplus. Many of us have spent the last 20 years helping to build that surplus. Why in goddess's name should the politicians be permitted to finance cuts in capital gains taxes, investment income taxes and the estate tax using that surplus?!

You're buying into the spin.

[Iowa]

9. Why raise the cap, you ask?

First, it appears that you're confusing two issues here, so take a deep breath, calm down, and listen for a moment. I don't think anybody here is proposing that the Republicans should be allowed to spend the trust fund surplus on anything but SS benefits. The debt owed to the trust fund should be honored and paid in full. You seem to have your shorts in a bunch thinking that everyone here (except you, of course) fails to grasp the obvious. But it's you who is missing the point, and the point is this: There are some Democrats who believe that the trust fund (presuming the debt is paid in full) may be strained at some point with the impending retirement of the boomers, and that some tweaks may be indicated now to assure smooth sailing in the future. Whether anything needs to be done is open to question. I tend to believe some small tweaks now may be wise, but making projections that far into the future involves the use of assumptions that can be wildly off the mark (in either direction).

So... if one believes that it would be prudent to salt away a bit more now, why raise the cap instead of all the other nonsense the Republicans are floating? Because payroll taxes capture less of the national income than it did in the past. Only 85 percent of payroll is subject to the FICA tax now, versus 90 percent in 1982. Why? Because today more of country's total wages go to earners making more than the cap. In other words, the upper echelon is earning more of the total pie, while the rest of us are earning less of it. Not to mention the fact that high income folks receive most of the benefits of the Bush tax cuts.

The upper crust is at the trough, my friend. They're pigging out. I'd like to see a more equitable wage distribution, but absent that, I wouldn't lose any sleep or shed any tears if Congress were to slow the gravy train a bit with an increase of the cap. But don't worry, there is no way this Republican Congress will do that.

[papau]

10. Well said :-)

:-)

[Iowa]

13. Thanks papau!

This can be a tough place to post. That's good, I suppose, because it keeps everyone on their toes. But there are a few folks here who are pretty quick to jump to the wrong conclusions. So your comment is greatly appreciated!

[sadiesworld]

14. I'm not confused about a thing, bucko.

If you don't think * is at least as interested in burying those "worthless pieces of paper" underlying the debt owed SS and regenerating the mother of all slush funds as he is in privatization, you haven't been paying attention. The only way that * can even begin to argue that there is any SS crisis is by assuming that the debt will never be repaid.

Let's discuss the practical results of raising the cap to $130K (the only figure I've ever heard bandied about), m'kay?

1) What good will it do? It will simply move a largely mythical insolvency date further out and give the politicos more SS $ to misappropiate for general revenue purposes (tax cuts? war?). Have you heard any proposals to stop the co-mingling of SS funds and general revenues? Me neither. It's a bit like going to your banker and being told that you need to borrow more $ instead of using the savings you have accumulated. And what's to stop them from doing this again, and again, and...

2) The dems will take the rap for this. *'s argument will be that he didn't want to raise taxes but was forced into a compromise by the evil dems on order to save SS. An additional 3% tax on all income b/t $90 and $130K is not going to go over very well with big city dems who are looking down the barrel of the AMT. Paul Krugman has written some good articles on this.

3) While a slight increase in progressivity (a 40K jump is not
slight) may be warranted at some future point, a massive change
in the nature of the program is dangerous. Teddy Kennedy has been arguing for years that turning SS into a "welfare" program, is a sure way to kill it. The republicans are masters at this kind of divide and destroy strategy.

4) Even if you think that "future-proofing" SS is a viable idea (which I don't), why now? * is handing the dems an '06 election issue on a silver platter. *'s approval numbers are at 25% on SS. Why would the dems want to jump in front of that out-of-control bus?

If you want to discuss this civilly, I'm game (although I won't be able to get back to this for a bit). If you want to be a jerk--I'm finished.

[Iowa]

17. Like I said, calm down and take a breath...

I was a professional in the mental health field and worked with ex-cons for many years. I have encountered every type of manipulation known to man. Tantrums and name calling may produce results for you with some people, but it won't even come close to working with me. I'm 100% con-proof, my friend. So get a grip, and stop reacting like a teenager when someone challenges you for leaping to the wrong conclusions and insulting your fellow DUers. If you want to put forth a position - just do it. If you persist in using your fellow DUers as straw-men to make your point, be prepared to be nailed on it.

Now... you made some very good observations in your last post, but you tried to build a straw man to make your points, so most of it was lost in all the histrionics.

Regarding your concern that the dems will take the rap for raising the cap... Again, you missed the point and jumped to an erroneous conclusion. Nobody here is suggesting that the dems should raise the cap. I think I made it pretty clear that I was writing to my republican senator, Charles Grassley, who just happens to be the Senate Finance Committee Chairman (and a water-boy for Bush). I'm telling GRASSLEY that HE should forget all the other nonsense he's floating and just raise the cap. The dems should stay the hell out of it and let the Republicans hang themselves; I think that's already obvious to everyone here. And as I said before, there's no way the republicans will raise the cap on their own. But if they were to do it on their own, THEY would take any heat for it, NOT the dems.

Regarding your concerns about "a massive change in the nature of the program" --- "turning SS into a welfare program" --- and this being a "divide and destroy strategy"... Again with the straw-man. Nobody here is suggesting that a "massive change" is warranted. However, if there exists a legitimate, good-faith, actuarial based concern about a future strain on the trust fund, the first tweak on the list should be to at least capture 90% of the payroll like we used to. That's hardly a "massive change" or a "divide and destroy strategy" that will turn SS into "a welfare program". It's simply a restoration of the balance we had before.

Regarding your comments about Bush's intent to renege on the debt owed to the trust fund, and your apparent belief that you are the only one who has "been paying attention" to that... Again with the straw man. Of course Bush wants to renege on the debt! That's what his SS "plan" is all about! It's so obvious that it almost goes without saying, and nobody here is suggesting otherwise. The Bush "plan" for SS is nothing more than a massive transfer of wealth from the poor and the working class to the very wealthy. Suggestions made here about raising the cap are made on the basis of the treasury bonds that are held in the trust fund today. Nobody here is suggesting that such tweaks will overcome a default on the debt.

I didn't seek a dispute with you - you brought it on with your insulting, demeaning, and condescending comments. I'm fairly new here, so I don't know who the trolls are, nor do I rule out the possibility that this is just an isolated incident with you. You strike me as a bright person, but you have much to learn about getting along with people, or perhaps you're just young and inexperienced. So I'll request something from you, and I'll make my request very plain so there is no misunderstanding: In the future, if you have some points you wish to make, just make them on your own. There's no need to leech on to others' posts, twist their words, insult their opinions, leap to erroneous conclusions about what they are thinking, misrepresent their positions, call them names, or otherwise use them to make your case. Just stand on your own and leave other posters the hell out of your comments. If you do disagree - that's fine - but you have to get it right! At least try to make a good faith effort to respond to what the poster is actually saying without creating a negative spin out of thin air. If you persist in leeching on to others' posts in a calculated and deliberately hostile manner, you WILL get slapped down.

Now I know you'll want to get the last word in, but you'll probably be writing to yourself because the thread is dead and I won't be coming back to check. So thanks for listening, and I sincerely hope that you do take a step back and relax. We're all on the same side here. There's no point to the hostility.

[Cha]

4. Yeah!

Not a centimeter!

[brokensymmetry]

15. Exactly!!!!

The pugs revisiting the issue is like a criminal returning to the scene of the crime.

Actually, they ARE criminals returning to the scene of the crime!

[dkofos]

19. Indeed!!

:evilgrin: :evilgrin:

[The_Casual_Observer]

6. I dare them to do anything. 2006 would be the largest political reversal

in history & they know it.

[dusty64]

11. Cut benefits and

raise retirement age, now THERES a winning strategy. The Dems need to make a BIG deal outta this, the backlash against the extreme right may make the next "elections" unriggable.

[thebigidea]

12. what a surprise that his repetetive speeches to handpicked crowds failed

[gratuitous]

16. "Okay, the public's not buying outright theft. What else we got?"

"You know, it seemed like such a good idea, too: Just hand over all the money to our political benefactors, the brokers, the moneymen, the bagmen, the grifters, the con artists, the shady dealers; and we'll let you keep a third--no, half! your benefits."

What went wrong?