February 23, 2005
An Alternate Reality for Social Security
Perhaps its cause is an irrepressible idealism on my part, but I still find myself stunned and disheartened by the stooped-to depths of political dishonesty. In this one sentence, Rep. Patrick Kennedy appeals to a completely alternate reality to score political points among people whom he assumes to be uninformed and/or stupid:
Since the president took office and began squandering the Clinton surpluses, the federal government has treated Social Security like a credit card -- borrowing from the Social Security surplus to pay its other bills.
First of all, "the Clinton surpluses" never amounted to money in hand. Rather, they were projections into the future based on a booming economy. (Although, I suppose that if any body can squander something it doesn't have, it's the federal government.) Second of all, the money that Social Security raises each year began being filtered to the federal government's general funds via bonds long before President Bush ever stepped into the White House.
From there, deconstructing Kennedy's "facts" is a tedious matter that I leave to interested readers. (For example, the suggestion that "Social Security would be unable to pay full benefits in 2021, instead of 2042 or 2052," ignores the obvious reality that Bush's private account program is meant to supplement benefits that Social Security will eventually be unable to finance.) I offer a summary piece by Donald Luskin as a helpful antidote.
Overall, in building his phony version of political reality, Kennedy is either a dupe of his own rhetoric or a con man. The story is that Bush has been "squandering the Clinton surpluses," in part because he tapped the Social Security trust fund, money that he "borrowed for big tax breaks." Yet yet! Kennedy's counter-proposal is "the ASPIRE Act, which would give every child an investment account at birth [for which the government would] put in a seed contribution, and match parental contributions for lower-income children."
In other words, a Congressman who has declared that he's "never worked a f***ing day in [his] life" prefers giving government-funded, redistributionist hand-outs to eighteen year olds to allowing working citizens to keep more of the money that they earn. A man wealthy by default wishes to ensure the importance of the government teat to the common citizen by taking money from the hands of parents, filtering it through the grubby ones of government, and then handing it back to adolescents just as they exit their parents' legal guardianship.
Somehow, I don't think Kennedy's concept of "an ownership society" matches that of believers in a free market and individual independence. The difference is who does the owning, and the alternate reality that he's striving to bring about is not one in which Americans should invest hope... or votes.
Justin:
Well put.
I also would like to see us reclaim the credit for those so-called "Clinton surpluses." Some people willfully ignore the facts:
The surplus can be largely traced to a decrease in defense spending, which was due to a peace dividend from winning the Cold War - something Clinton had absolutely nothing to do with but President Reagan certainly did.
It can also be traced to a strong economy which, other than a brief and minor downturn around 1992, continued in growth mode from the early 1980's until the late 1990's - and was initiated by the Reagan tax cuts. Clinton can get credit for mostly not getting in the way but he deserves no personal credit for any policy innovation.
Finally, it can be traced to some moderation in government spending which began mostly after the Republicans took over Congress in 1994. People forget that the deficit had been declining after the passage of the Gramm Rudman act in 1986 and was down to the mid-$100 billion level by 1989 when Reagan left office, only to climb up to $300 billion annual deficits from the time Bush 41 broke his "no new taxes" pledge in 1990 until after 1994. (How we long for the days when Republicans in Washington, D.C. stood for moderation in government spending.)
Don
Posted by: Donald B. Hawthorne at February 23, 2005 7:57 AMDavid Frum added his comments on the Trust Fund debate in the February 22 edition of his diary on NRO:
Posted by: Donald B. Hawthorne at February 23, 2005 1:21 PMDavid Frum has weighed in today with a second round of thoughts on the Social Security Trust Fund:
Posted by: Donald B. Hawthorne at February 24, 2005 2:03 PM