A prudent man never gambles away more than he can afford; yet Wall
Street and that is nothing but the numbers racket, wants your Social
Security Money - and Clinton, boy that guy is to get it is alleged, 8
million dollars a year as an investor?
So this item is worth a read; Social Security is money that belongs to
you - Americans walking into a trap if they fall for this one - the mob
awaits you in Wall Street....
Saba
Current Issue Archives Labor Party Home Join the Labor Party!
Don't Blow Away
Social Security
There is no Social Security crisis. But if Democrats and Republicans get
their way and privatize the system, there will be.
"It's weird," says economist Dean Baker of the Preamble Center, who has
been studying and writing about Social Security reform. "We're all
looking at the same numbers, and what the numbers say — even the
pessimistic ones — is that we could take absolutely no action on
Social Security for the next 34 years, and the program would continue to
pay out all its benefits." And yet, politicians of both parties are all
aflutter about the need to radically reform Social Security right away.
The picture they paint does sound grim: Mostly because people are living
longer, today's workforce is supporting a greater and greater number of
Social Security recipients. And the trend will probably continue. In
1995, there were nearly five people under 65 for every one person over
retirement age. But by 2030, the ratio will be more like three workers
for every retiree. And since Social Security is actually a pay-as-you-go
system — current workers pay for current retirees — that spells
trouble. (See "Social Security Basics")
For the time being, we can supplement the shortfall by drawing from the
extra pot of money the Social Security system has amassed (the Social
Security Trust Fund). But then, in 2034, according to some projections,
that fund will be depleted, and Social Security money will have to come
from active workers alone. And, under the current formula, they would
only be able to cover about 75 percent of the benefits retirees had been
promised from Social Security.
President Clinton and members of Congress say "saving" Social Security
is at the top of their agenda (after impeachment, of course). Many
recipes have been written for rescuing Social Security. The most extreme
plans involve privatization. Some people want the Social Security
payroll withholding to go into our own "personal security account" that
we can invest ourselves. Less radical plans would allow the Social
Security Trust Fund to be invested in the stock market, where it would
supposedly get a higher return than where it is invested now, in U.S.
Treasury bonds.
President Clinton favors a combination of both ideas: He wants to invest
part of the Social Security Fund (eventually up to 15 percent of it) in
the stock market. He also proposes setting up voluntary new private
accounts for middle- and low- income Americans — but outside the
Social Security system.
At a time when the stock market is in the stratosphere, record numbers
of Americans are investing, and the airwaves are full of experts
advising the general public on how to get the best return, the idea of
turning Social Security into a personal Wall Street investment portfolio
is appealing to a lot of people.
But not everybody's sold on the idea. To begin with, many people
question whether there even will be a Social Security shortfall. They
argue that the Social Security hullabaloo is all based on some very
gloomy economic projections made by Social Security trustees. In their
reports, the trustees assume that over the next 75 years, the U.S.
economy will grow at less than half the rate it has grown for the past
75 years. According to a report by the New York-based Century
Foundation, an increase in annual economic growth of just .15 percentage
points over the next 35 years would raise output by as much as the
combined increase in the cost of both Social Security and Medicare.
Meaning: Workers of the future may have no trouble supporting the
growing ranks of the retired.
And yet, our politicians have managed to convince a majority of
Americans that there really is a crisis at hand. Polls of younger
Americans show that many believe they can expect little or no money from
Social Security when they retire (unless, perhaps, the system is
radically changed).
So who started this rush for a "solution" to the Social Security
"crisis"? Follow the money. Wall Street could stand to gain $240 billion
in fees within the first 12 years of a privatized system, according to
economist Christian Weller. That, he points out, is enough to give
20,000 fund managers an annual salary of $1 million each. No wonder the
financial industry has spent millions of dollars of late to promote the
idea of
Social Security privatization.
Economist Dean Baker believes there's a deeper motive behind the
privatization push: "I think much of this is being driven by people who
are just plain anti-government," he says. "And Social Security is the
government's flagship social program."
It may be, says Baker, that some minor adjustments will need to be made
to allow the Social Security system to continue in good health. (See
"What We Should Do.") But privatizing the system and investing Social
Security money in the stock market is not the way to go. In fact, he
believes, it would take the "security" out of Social Security. Most of
us would see our retirement incomes dramatically reduced.
Continued ->
Labor Party
A. Saba
Dare To Call It Conspiracy
A. Saba
Dare To Call It Conspiracy
http://www.igc.org/lpa/lpv42/lpp42_ss_main.html
