It Ain't Over 'Til Pelosi is Sworn in As Speaker

Bush vows: the dawn of the return of the night of Social Security reform (not, please, "privatization") will come next year…if the GOP holds the House. Given that a major reason for abandoning that cause so far was its potential downside for GOP legislators with voters this November, it's not entirely clear what he hoped to accomplish politically by making this vow now--maybe a little bit of "energizing the base"? That can go both ways, of course--it will be interesting to see how much play this comment of Bush's gets in the next month and a half.

Comments

[Bret]

The headline to this story just made me cry.

[John]

It sounds empty. It's been almost 6 years. How much more can anything they "want to do" be taken seriously anymore??

With full control of both houses and the white house, they've done nothing in the way of major reform...just tax cuts. And the tax cuts card is used up.

[tarran]

Actually, if the Democrats win the Congress I would not be surprised if they resurrect social security reform.

The reason being is that it allows them to look compromising and reasonable while further extending government control over the economy.

The payroll tax that funds social security is a very attractive funding stream. By redirecting it into the stock and bonds markets they assure those who benefit from investment in those markets of a steady stream of income. The major beneficiaries will be those who get their financial instruments listed on the Federal roll of approved investment vehicles.

Due to the abbysmally low savings rate of most residents of the United States, coupled with the impending wave of retirments of baby-boomers who will wish to convert their investments into cash rather than purchasing shares or bonds with cash, the managers and beneficiaries of these investment vehicles face an increasingly competitive market chasing fewer and fewer dollars.

If one gets his or her investment vehicle approved as a recipient of the payroll tax, one is assured of a steady stream of cash. As a bonus, the funds' fortunes become a political rather than economic issue. Fund managers who face severe losses due to unwise investments can be assured that the Federal government will strongly consider interventions needed to mitigate their losses. Thus, if by some miracle one of the approved funds invests heavily in the carrier pigeon industry, the government can be assured to provide favorouble regulation and subsidies to keep the carrier pigeon industry afloat either by supporting it, or knee-capping less politically urgent industries in order to placate the millions of voters whose retirment income is threatened.

This drive, the desire of various captains of industry to have the government shield them from competition and to protect their profit streams or access to capital, has been the primary motive force permitting the conversion of the U.S. economy into an increasingly fascist economy.

For the Democrats, there are many advantages:
1) They will succeed at something the Republicans failed.
2) They will look reasonable and compromising.
3) There will be wonderful opportunities for graft as people jockey to get their funds on the approved list.
4) It will allow politicians to exercise an even wider control of the economy (since managers who do not toe the government line can find themselves yanked form the list of approved investments).
5) It allows them to appear to be doing something constructive when the Ponzi Scheme known as Social Security inevitably begins to collapse.

[John]

Tarran,

Objectively speaking, how are the side effects of putting these funds into stocks and bonds and the ensuing anti-competitive regulatory measures (er, favors) really any different on a privatization plan by the GOP??

[tarran]

They aren't. I believe that the Democrats torpedoed Bush's attempt because they weren't being cut in on the graft.