BUSH'S SOCIAL SECURITY FRAUD

Three links courtesy of BuzzFlash. First, from the New York Times, Princeton economist Paul Krugman explains why, despite Republican ranting and raving, there's not really a Social Security crisis at all:

Stopping the Bum's Rush

Here's the truth: by law, Social Security has a budget independent of the rest of the U.S. government. That budget is currently running a surplus, thanks to an increase in the payroll tax two decades ago. As a result, Social Security has a large and growing trust fund.

When benefit payments start to exceed payroll tax revenues, Social Security will be able to draw on that trust fund. And the trust fund will last for a long time: until 2042, says the Social Security Administration; until 2052, says the Congressional Budget Office; quite possibly forever, say many economists, who point out that these projections assume that the economy will grow much more slowly in the future than it has in the past.

So where's the imminent crisis?

Click here for the rest.

Next, from the Washington Post, a story that shows how Bush is already testing the political waters for his crazy schemes to deal with this non-existent crisis:

Social Security Formula Weighed

Under the proposal, the first-year benefits for retirees would be calculated using inflation rates rather than the rise in wages over a worker's lifetime. Because wages tend to rise considerably faster than inflation, the new formula would stunt the growth of benefits, slowly at first but more quickly by the middle of the century. The White House hopes that some, if not all, of those benefit cuts would be made up by gains in newly created personal investment accounts that would harness returns on stocks and bonds.

And

Opponents of the proposal have also been mobilizing. Under an inflation-linked formula, benefits would keep up with prices, but wage levels determine standards of living, Rother said. Social Security benefits currently equal 42 percent of the earnings of an average worker retiring at 65. Under the new formula, that benefit would fall to 20 percent of pre-retirement earnings. Future retirees would, in effect, be consigned to today's standard of living.

"It's like saying elderly people today should live at a 1940 standard of living," said Robert Greenstein, executive director of the liberal Center for Budget and Policy Priorities. "Part of our social contract has been to allow seniors to participate in rising standards of living rather than consigning them to some second-class status in retirement."

But proponents say the shift to price indexing has to be viewed with the addition of private accounts.

"If this was a case of just price indexing and doing nothing else, frankly, some of the [opponents'] charges are pretty valid," John said. "But if you give the personal accounts as well, you're giving people the opportunity to make up the difference. Not everyone will do that, but a substantial number will."

Click here for the rest.

Hmmm. Even proponents admit that these bogus personal accounts will only help a "substantial number" of people. I wonder what that means exactly. My best bet is that "substantial" actually means "a few." For some clarification on that point, here's a quickie from the Center for American Progress:

Bush's Con on Social Security: Cut Benefits and Roll the Die

With Social Security benefits cut, you will be forced to make up the difference on your own. The White House wants you to believe that the "miracle" of private accounts will magically make up the retirement money lost from your soon-to-be cut Social Security benefits. But analysis by MIT professor Peter Diamond and Brookings economist Peter Orszag shows (based on figures from the Social Security actuaries) that average life time earners retiring in 2075 can expect to make up less than half of the cut to their Social Security benefits through private accounts.

Click here for more.

Hmmm. "Less than half." And don't forget that's only for a "substantial number" of people, which probably means "a few."

Angry yet? I sure am.

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