Hello? If McCain Had His Way, That'd Be Our Social Security Money Wall Street is Losing

What do we democrats have to say about the mess on Wall Street?

Today Obama said it proves that the Republican economic philosophy has failed, and I heard him mock McCain for calling for a commission because "we know how we got into this mess." Now some people think about things like "economic philosophy" a lot, and many have at least a general notion of how we got into this mess. But even though everybody cares how much money ends up in their pockets, most people are understandably a little fuzzy about all the policies and philosophies and market forces behind our very complex economy. To further confuse the issue, McCain is also saying something about reform, and taking on "fat cats," and accusing Obama of being just as cozy with these Wall Streeters as anyone else. And at this point, slightly more voters trust John McCain to handle the economy than trust Barack Obama.

As it happens, though, not that long ago we had a rare political moment in this country, a moment where the public sat up and took notice of economic policy -- and spoke out and made its voice heard too. When George W. Bush made it to term #2, he decided to try to privatize social security to reward his supporters on Wall Street with a new source of capital, customers, and fees. (Those would be the same people whose firms are now cratering under the weight of the bad debt they recklessly took on while Republican regulators looked the other way.) But as it turned out, we Americans were not about to let our elected representatives turn over our social security taxes to Wall Street financiers to gamble with if it meant losing the guaranteed income that has allowed millions upon millions of American seniors to live out their sunset years with at least a basic measure of dignity.

But while ordinary Americans spoke out, John McCain stood with Bush (hugged him awkwardly in public, even), against the American people. In fact, just six months ago, McCain again let slip his fondness for privatization.

I have been scratching my head why this has not been talked about more, especially since Obama has been having trouble winning votes among seniors. There may well be some good reason I'm missing why it hasn't been a top argument thus far.

But now that you can't look at a newspaper or TV screen without seeing the mayhem on Wall Street, it's time to remind Americans what the world would look like if John McCain was in charge of our economic policy. Plenty of people are losing plenty of their retirement savings as it is. But if we had let Bush and McCain privatize social security, some of those people would be losing a lot more. And a lot of other people with less retirement savings would be hurting even more, because they depend on social security to cover basic needs.

This is something Americans understand: social security is secure, and the stock market is anything but. There are few more personal or dramatic ways to illustrate McCain's terrible judgment than to imagine the nightmare scenario so many Americans would face if McCain and Bush had gotten their way on this -- or if McCain were to get his way as President.

When Wall Street's woes are the top story, this should be our top talking point.

Comments

[hosshoss777]

I never understood the privatization thing, It's not like the government takes your SS Taxes and simply put them in a lock box where the moths eat it till they get ready to give it back to you in your retirement. SS that you pay in goes to the people that now collect and any surplus is spent by the Government here and there. Just what money would have gone to the stock market? If you were to put your SS money into the stock market then who's money would go to pay the current recipients of SS?
No, you were right in your first couple of sentences, we have no idea what our money is where it comes from and where it goes other than the immediate value of what we seem to be able to purchase with it in our daly lives.
The government seems to be proving that they can simply create money and debt right out of thin air with no apparent worry of any kind of day of reckoning.

[Biffmeister]

Clinton's policies weren't always what I would have had him do. However, he took on a bad economy based on supply side economics, and turned things around in relatively very short order. America prospered during his tenure. Obama and Hilary Clinton, despite going at each other for the nomination (at a very mild level compared to some past elections--common practice) are very similar in their suggested policies to help the American people. It is a safe bet to say Hilary would have policies similar to her husbands, and so will Obama. McCain has and will continue to side with Bush's disastrous policies. Leopards don't change their spots.
The current problems are not the fault of a Democratic Congress. They have had their hands tied by a few Republican Senators (filibuster threat) and presidential veto. If you elect more Democrats things can start to move again--whether or not you consider yourself a Democrat. We had a Republican congress and president at the same time and you are seeing the results in our economy and elsewhere.
If we can spend billions to save huge corporations, we can spend a little to help social security.

For openers, could both sides (bloggers?) agree that if a financial institution is bailed out by taxpayer dollars "we the people" should get a large part of the profit upon recovery. This would include the golden parachute/­compensati­on that should not be given to failed CEOs. You don't get to profit from your failures.

[rnadna]

Lets get the record staright!
ALL 3 Branches of the Government for the last 8 years were REPUBLICAN controlled!
Every law and piece of legislation that passed was passed by the REPUBLICANS! Even the WARS!
Only the last 2 years did the House of representativies have a democratic majority - BUT THEY DID NOT HAVE ENOUGH VOTES to pass anything as a big number of these voted REPUBLICAN!
Its saddening that 3/4 of the American Populace do not know or understand how their govermnet works! But they do know what comes out of their PULPITS and FOX NEWS!!
To these folks - GET EDUCATED! Or loose your country!!!

[marm]

Finally! An informed voice! But you didn't go far enough in explaining it to the dunderheads. The House, which has a substantial Democratic majority, has time and again passed bills that would have implemented many of the much needed changes promised by Speaker Pelosi ater the mid-term elections. Unfortunately, when they got to the Senate, they died, since Republicans there blocked them and the Democrats did not have the needed 60 votes to prevail against their efforts or wield the power to override Bush's vetoes. The Republican Minority Leader (from Kentucky) has been one of the most obstinate and obtuse individiuals it's possible to imagine, and I frankly don't know how in the world reasonable senators have managed to contain the frustration and anger he and his staunchest allies have generated. I have watched congressional proceedings on C-SPAN when I have had to turn off the TV just to control my own blood pressure! Anyone who blames the Democrats in Congress for ANYTHING done or not done during the last two years does not understand how the system works and should keep quiet until researching the facts.

[CarolTate2]

Make Congress put Social Security funds back into the Trust Fund to be used ONLY for Social Security purposes as it was originally intended. Want to see Social Security fixed, Remove the 100% Pension Retirement policy for politicians & make them pay into it & draw Social Security just like the rest of us! Do you receive 100% of your salary & benefits when you retire even though you may have worked just for a year?????

[Belisarius]

Well John McCain maybe even duller than George Bush, but I don't think you understand Social Security. SS takes in a lot more than it pays out, but what do you think happens to the surplus? It is added to the general fund and spent on things like the bail outs of the last week.

Cato institute estimates that congress had spent $1.5 trillion of our surplus SS funds by 2005 i.e the entire suplus. Also, congress in I believe 1998 also passed a law that removed the SS debt off books i.e. it does not show up in the deficit. And what did they give us in return? IOU's from the treasury. And where does the treasury get money? Us taxpayers. We owe ourselves.

Now what was wrong with the idea that some of our money that congress spends on earmarks would come back to us to invest? Google social securiy lock box and you will find a photo of 3 filing cabinets filled with IOUs.

[Artos]

Belisarius,
So really all you are saying is that we would lose our money either way, so we might just as well bend over, grab our ankles and kiss our butts good bye. The fact is that in their so called investment plan they never said anything about giving the money back to us to do the investing. As far as I can remember they had intended to do the investing for us. I can just imagine where all of that money would have ended up. Can we say Offshore Bank everyone.

[Artos]

mh01,

Given what is happening on Wall Street right now, where do you think you would be financially right now. I was watching an interview today on Charlie Rose. He had a guy on named Greenberg I believe, who used to run AIG. He said that he had lost millions since yesterday because of mismanagement at the top in AIG. If he lost millions, where do you think your paltry few dollars would be now or do you reckon yourself to be a financial wizard?

[charleydan]

Privatized or Government control.

Social Security was borrowed, really spent long time ago by congress. Since that hole was dried they went to the Middle East, China, Europe and Russia to get their Friday spending money. Or was it to buy political votes because the voters wanted something for which election was that now?

And we call that safer then the market.

I want to invest it myself. The American people have known for sometime this was coming. If they did not a thing to protect themselves. I think that is called irresponsible. I bet you did not even talk to your representative and asked him what was going on? Then you have no beef now. My congressmen are catching hell, because I asked them to do something.

Yet, you holler during this election wanting more.

All taxation comes at point of purchase or consuming the product. So hope you enjoy the taxation that congress has not reduced for the low and midddle class.

[CarolTate2]

Social Security (FICA)-Who Stole It & How They Did It
Franklin Delano. Roosevelt (March 4, 1933, to April 12, 1945), a Democrat, introduced the Social Security (FICA) Program. He promised:
1.) That participation in the Program would be Completely voluntary
2.) That the participants would only have to pay 1% of the first $1,400 of their annual Incomes into the Program,
3.) That the money the participants elected to put Into the Program would be deductible from Their income for tax purposes each year,
4.) That the money the participants put into the Independent 'Trust Fund' rather than into the General operating fund, and therefore, would Only be used to fund the Social Security Retirement Program, and no other Government program.
5.) That the annuity payments to the retirees would never be taxed as income.
1958 democrat controlled Congress voted to remove Trust Fund and put it into the General Fund for Congress to spend. Lyndon B. Johnson (Democrat, November 22, 1963 to January 20, 1969) and the democratically Controlled House and Senate.
Dems eliminated the income tax Deduction for Social Security (FICA) withholding?
Albert Arnold Gore, Jr. (Al Gore) [Vice President, January 20, 1993 to January 20, 2001] cast the 'tie-breaking' deciding vote to tax Social Security.

James Earl Carter, Jr. (Jimmy Carter) (Democrat, January 20, 1977 to January 20, 1981) the Democratic Party, Immigrants at age 65, began to receive Social Security payments! though they never paid a dime into it!

[VANDERGRAAFK]

Gee, I guess you don't like Social Security much. Why not? Would you prefer it as FDR envisioned it? Or, would you prefer a system that provides an income floor for those who need it and denies it to people who don't need it (John McCain)? I, for one, have never ever had a problem with those who wish to invest their own money for additional retirement funds. I have done so also. But, I would like the knowledge of knowing that should something go terribly wrong and I have to prematurely liquidate my retirement funds that there still will be a reserve on hand.

Now, you want to decry those who get Social Security without ever having paid into it? Sorry, but SS was never a savings fund. The first recipients received much more than they ever put into it. As for me, I'm a California teacher. Even though I pay Social Security when working a second job, I will never be entitled to SS as long as I remain a teacher. It's called double dipping and is currently not allowed. I guess because teachers are too rich!

[NOSMAVAN]

This baloney of Immigrants who never paid a dime into the system receiving Social Security payments is one of the most often repeated LIES. It is not true, it never was true and it never will be true.

Persons who do not contribute to the system, or who haven't contributed an established minimum to the system, do not receive social security payments, whether they be immigrants, U.S. Citizens, from the planet Mars, or whatever.

On the other hand, all working persons who have contributed at least the established minimum to the system will receive social security payments upon reaching the age of eligibility. This includes immigrants, alien residents, U.S. Citizens, Citizens of foreign countries who have worked in the U.S. and have contributed at least the minimum to the s/s system, whether such eligible persons live in the U.S. or not upon eligibility. In other words, if a person has worked in the U.S. and during that time contributed to the system to fulfill the minimum requirement, this person will receive s/s payments; if he/she lives outside the U.S. the check will be mailed to him/her, or if he/she has a U.S. bank account, the money will be deposited for him/her.

There are some exceptions such as people who continue to work after retirement age, and earn more than an established annual salary.

So, please stop spreading this old, weary and dishonest REPUBLICAN LIE.
NOSMAVAN

[PEACEinOurLifeTIME]

An Excellent point and should be used to BASH McCain's DEBATE BRAINS OUT with!

[Chillinout]

I am also confused about why this isn't being hit on hard by Obama. It wouldn't be too difficult to extrapolate his wish to privatize SS into a future where all seniors could lose the one safety net that seniors have in this country.

[lindaisaiah]

Chillinout, Obama is hitting hard on this issue. He has a message going out today that is awesome. He's not going to get on McCain's dirty tactics, so he is able to speak to the people where they live and not dirty his hands with rhetoric!

[StrangerThanFiction]

John McCain has sat back and watched this whole financial meltdown happen and has not offered one ounce of anything specific to change or control or do something constructive about anything!

Despite all of the lies and omissions by the McCain Campaign and the Republican Party...de­sperate to retain power and their tax loopholes.­..he has NEVER really STOOD UP TO THIS ADMINISTRATION WHO HAS USED AND ABUSED THE AMERICAN TAXPAYERS, spending it like drunken sailors and into the pockets of Special Interests, Corporate America, the Warmongers, and Foreign Countries.­.. ANYONE WHO WOULD HELP THE RICH GET RICHER!!!

THE TAXPAYERS are the ones that this administration, since 2000, has stolen over $5.1 TRILLION DOLLARS FROM OUR TRUST FUNDS...IN­CLUDING OVER $1.4 TRILLION JUST FROM THE SOCIAL SECURITY TRUST FUND ALONE!!! SOME OF THE OTHERS....­MILITARY RETIREMENT TRUST FUND, RAILROAD RETIREMENT TRUST FUND, FEDERAL EMPLOYEE RETIREMENT TRUST FUNDS, THE AMERICAN INDIAN TRUST FUNDS..AND MANY MORE!!! THERE IS NO PLAN TO PAY THIS MONEY BACK...THA­T WE WORKED HARD FOR...AND NO WAY TO PAY IT BACK NOW!!!

ADDITIONALLY, THIS ADMINISTRATION HAS BORROWED BILLIONS FROM 12 FOREIGN COUNTRIES! ALL OF THESE LOANS ARE BACKED BY HARD AMERICAN ASSETS LIKE U.S. TREASURY BONDS!!! CAN YOU IMAGINE THE PRINCIPAL AND INTEREST THAT WE HAVE TO MAKE MONTHLY ON THOSE LOANS?

THEN THE BIG BANG...USI­NG OUR TAX DOLLARS...­WHAT IS LEFT OF THEM...TO BAIL OUT MISMANAGED AND PREDATORY INSTITUTIONS AND CORPORATIONS!!! ISN'T THAT A KICK IN THE HEAD?

[quadman]

Hmmm.

Risk loss through some privatization.

Or

Guarantee loss because incompetences on both sides of the aisle never protected the SS funds in the first place. (See SS certain insolvency with no changes to the system)

[Grit]

As I remember it just a short time after Clinton removed SS funds from the general fund ( after an long and brutal battle with the republicans) it was just a few short years before the fund was solvent with a surplus. Have we already forgotten the "locked box" phrase to describe hands off the ss fund? Of course one of the first things lord bush did as president was take it out of the locked box and give it to the mega rich as a mega tax cut. So now again they are screaming its insolvent. Actually its all a lie to get allow the investment corps to get their grubby fingers on it. We are now seeing what will happen to the SS retirement when they do. Of course McCain will gladly hand it all over to them he has already made us that promise. Trouble is I am not sure Obama can stop it happening. Greed is a hard thing to fight when almost half of congress have their sweaty hands out for lobby money. After all putting a middle man that needs big profits always makes government programs better. For example HUH humm I am sure there must be one somewhere.

[quadman]

Unfortunately, pols from both sides of the aisle never had a lock box for SS. Not once since Day 1 of the New Deal.

[VANDERGRAAFK]

Can you imagine the uproar if a) we required the federal government to present a budget that does not rob Peter to pay Paul and b) we allowed the Social Security Trust fund to invest in government T-bills and earn interest off of the lending of money to the government? Wait you say: we do? We do allow a and b. How can this be?

Well, think about a bank. If you place your money in a savings account, do you really think that money stays there waiting for you to claim it? Hardly. The bank takes your money and re-invests it. If it is wise, it makes a profit off what it agreed to pay you in interest and what it earned by investing the money. That, in essence, is what the Social Security Trust fund does, except it can't invest in the stock market or use the money to buy up companies. Rather, it is "forced" to buy T-bills and thus accept "IOUs" from the government.

What's the problem in that? Well, it only arises when a party constantly screams for tax cuts (to the wealthy) and refuses to pay for a war that has dwarfed all others in cost and thus borrows, borrows and borrows. The piper will be paid because someday when we boomers retire, you young'uns are gonna cough up the money and see a decline in your standard of living. TADA! That's what Bush has brought to you!

[Artos]

Protect it? Why would they protect a nice little slush fund. There should have been in place a law that specifically prohibited the use of the Social Security fund for anything other than what it was intended. Those that stole from it should have been incarcerated.

[quadman]

The fact that there never was protection for SS funds from the government was the point I was making.

[jackwaddington]

Can't believe these comments. Save America? It's already doomed. America will be a vague memory by 2020. The whole system is crumbling about our ears and it started somewhere about 1776. It looked good on paper but alas the paper is all faded and now torn. We should be putting our efforts into saving our species and saving the planet instead of trying to save a whole swath of dirt that first was stolen from a community already here. Get out of your boxed in brains. The problem is way much larger than most of the suggestions here.

[rnadna]

jackwad - you from mars or something? this rambling makes as much sense!

[Slimsmom]

EXACTLY! I am so glad somebody finally said it. I, too, am surprised Obama isn't blasting this little fact from the rooftops. Remember people? All the conservatives were insensed when Democrats wouldn't let Bush get his hands on Social Security monies to gamble with on Wall Street? The current economic fiasco is a perfect example of why the Dems said no how, no way to that imbecillic proposal.

Believe it or not, many conservatives on other forums are actually saying that if Bush's plan to privatize had gone through that maybe Wall Street wouldn't be in the financial bind it is in. See, all that money is not available to shore them up against their own worst judgment. Lehman, AIG, Fannie and Freddy have to go on welfare. Crocodile tears anyone?This sort of blind ignorance is what we are up against. I absolutely do not understand this logic. It seems to me that conservatives will find a way to justify almost any dastardly deed they want to foist upon the American public. Truly mind boggling.

[Lorijen]

Instead of my Social Security check, this month I just got a notice:

SALLIE MAC (THE PRIVATE COMPANY THAT OWNS YOUR SOCIAL SECURITY FUNDS) IS BANKRUPT.

SORRY BUT NOT SORRY.

VERY TRULY YOURS, WALL STREET

[Paul Peete - Huffpost Blogger]

John,
While I agree with you that the Republicans have rung the deregulation bell so often that they are now tone deaf, and privatization of Soc.Sec. is a bad idea, there is one flaw in your analysis. The Trust Fund, the lock box that Al Gore reminded us of continually, is by no means safe. The Congress has raided that for years and when the boomers retirement hits full stride, you will see a reckoning that has been hid from the public since Reagan.

Now that we are bailing out Wall St. and AIG, where do you think our burgeoning deficit will look to keep the government operational? I am no financial expert bu I know a shell and pea game when I see one.

[Artos]

Yeah Paul, They are lying to us just as the incompetents on Wall Street are lying everyday. Why should they care since they fear no retribution. If they even get penalized or go to jail, it will be a pittance or they will do very little time because they get light sentences. Look at Abramoff. He gets a 5 year sentence and will most likely be out by next summer Or sooner if Bush can pardon him on the sly. Only Average Joe Blow gets harsh justice, because you can't let the little people believe they can get away with robbing the wealthy.

[CLI]

You hit the nail on the head! I work in healthcare and about 12 years ago, these same privatization warriors started encouraging elderly persons to switch from Medicare to the private insurance companies. We in health-care knew this was a dangerous ploy that would leave vulnerable elderly people under-insured. Sure enough, that's what happened. Private companies used bait and switch tactics to get seniors off Medicare and into private, for profit programs. Ultimately it's an attempt to dismantle the Medicare program.

Health-care workers knew this was a scam because we had been through a similar effort to supposedly rationalize the medical system in the 1980s and 90s. They restructured and working conditions, job security, and benefits declined, but that did not reduce the cost of health-care. Savings simply shifted to profits for the corporations operating the hospitals, manufacturers of medical equipment, and pharmaceutical companies. These companies call the shots in the medical system. The once powerful AMA, is now just an effete professional club.

Seniors going along with the privatization ploy and counting on those retirement funds for their "golden years," would be in for a surprise. They would likely find themselves in the same situation as homeowners are in now----no trillion dollar bridge loan for them---no way. But they would offer a big bailout to the corporations that deep sixed their savings. Retired people counting on those investments would get nothing----save a big lesson too late for the learning.

[Artos]

CLI,
Talk about your class warfare. Only the ones who are doing the waging of it are the wealthy. They appear to be winning.