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What to Look for After the Election: Social Security Under Assault

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Should Mitt Romney and Paul Ryan win the election, they will undoubtedly push for non-trivial reductions in Social Security benefits under the thin pretext that it will be help to close the deficit and restore fiscal balance over the long term (it will not, as Social Security is not the driver of the current deficit and the program is neither in "crisis" nor "going broke" any event). To their credit, the Republican ticket has made no real effort to hide their intentions, even though their stance has hurt them politically.

What to Expect from the Record so Far

However, in light of the almost comical implosion of Mitt Romney's campaign, President Barack Obama's reelection appears to be an ever-greater certainty. For that reason, liberals and progressives need to prepare themselves for what will be, at best, a mixed blessing. On foreign policy, we have little reason to doubt that it will be "business as usual." That is to say that the Administration will take their reelection to be an endorsement of their decision to adhere faithfully to the failed policies and ongoing wars of the Bush Administration.

Domestic surveillance? Civil liberties? The evisceration of the United States Constitution? The continuation, even the ramping up, of extra-judicial incarcerations and killings? It is common knowledge that the Obama Administration is a fervent proponent of all of these. Those who believe in the "Imperial Presidency" will have much to admire. Less enthusiastic will be those who think that in a Constitutional Republic everyone is entitled to free speech, a speedy and fair trial, and that no official should be above the law or free from public scrutiny.

But in this miserable litany of broken promises and what has become, even for cynics, a shocking embrace of right-wing policies, let us not forget the domestic agenda. Most thinking adults now understand that the Administration has been shameless in its feckless pursuit of every conceivable means to prop up the "Too Big To Fail" financial institutions, even as they have left destitute and defrauded homeowners to fend for themselves. Worse yet, they have scrambled to release these same institutions from the legal consequences of their criminality and all round venality.

Social Security On the Block?

But another threat now looms. There are increasing signs that, post-election, a top Administration priority will be to significantly cut Social Security benefits while raising the retirement age. It would take awhile to assemble all the evidence, but a helpful blogger has conveniently collected virtually all of President Obama's evolving statements on the supposed "crisis" in Social Security. The trajectory they reveal as he has moved from being a candidate, to being President-Elect, and then President, is disturbing. In this post, I would especially direct your attention to several statements the President made in the weeks prior to his inauguration. They affirm that Social Security cuts have long been on his agenda.

Now, one might -- correctly -- observe that throughout this election the President has successfully positioned himself as the one most likely to "save" Social Security. But, let us recall, he is being ranked against the former head of Bain Capital and an Ayn Rand ideologue. That is a low bar, and for that reason there is no cause for complacency. In fact, there are six reasons to remain worried:

First let us recall that this President is, relative to others, unusually comfortable with breaking platform commitments and betraying supporters.

Second, we know that Wall Street has been interested in full or partial privatization of Social Security since its inception. Moreover, they have spent tens of millions of dollars over the past two decades across several public relations campaigns to get us to believe that there is a "crisis," one that only can be solved only by significant cuts.

Third, the President's failure to answer Senator Bernie Sanders' (I-VT) call for a clear and unambiguous statement that Social Security will not be cut during his second term is suggestive. The Vice President, to his credit, has said that he "guarantees" that no such cuts will occur. But it is hard to assess the weight of such a guarantee, as the VP has essentially no executive power under our form of government.

Fourth, we should recall that a partial privatization of Social Security was one of the highest (if unstated) priorities of former President Bill Clinton's second term. A deal had been struck with then-Majority Leader Newt Gingrich, and they were prepared to roll it out in 1997. Then came Monica Lewinsky (if Social Security still exists when I retire, I intend to raise a toast to Ms. Lewinsky the day I get my first check).

Fifth, the deal mentioned in the previous paragraph was negotiated by then White House Chief of Staff Erskine Bowles. Yes, that is the same Mr. Bowles of the Bowles-Simpson Deficit Commission appointed by President Obama to devise "non-partisan" (Washington verbiage for "right wing") ways to reduce the federal deficit. Can we be surprised, given its membership, that it called for significant "entitlement reform"? We should recall that this report, and its call for Social Security cuts, was at the foundation of a failed "compromise" proposed by the President during the "debt ceiling" negotiations of 2011. Since we are on this subject, is it not an ominous sign that so many "insiders" have Mr. Bowles slated as a frontrunner to be Secretary of the Treasury Timothy Geithner's successor during the second term? It is hard to imagine, but we may come to a day that no one could have anticipated ... a day when we miss Mr. Geithner!

Perhaps it is well known, but the politics of Social Security are such that only a second-term Democrat can bring about its partial or full dismantling. Of course, such a Democrat would have to have a proven record of placing the interests of Wall Street above the needs of his own party and the public more broadly. Today, on the cusp of this election, these pre-conditions have been met. It follows that 2013 will be Wall Street's best opportunity since 1997 to cash in on that Holy Grail of money management -- the Social Security Trust Fund (Just imagine the revenues to be garnered from the fees collected on managing 310+ million individual private accounts? And let us not even discuss the potential returns from sharp practice or outright fraud). There is no doubt that Wall Street, the "think tank" impresarios who write their "scientific studies," the lobbyists who do their strategizing, and the public relations firms who speak for all of them, fully understand that they may be on the cusp of a once-in-a-generation opportunity.

I humbly suggest that we the people, or at least the 90% that Mitt Romney recently identified as "middle class," need to brace ourselves for what may be the most important domestic political fight since the New Deal. Specifically, we must be prepared for dishonest statements and reporting from a wide range of sources, including the mass media, bankers, "experts," and public officials. Success will depend upon an alert citizenry because, when presented with a choice between the needs of the American public and the interests of Wall Street, this President has a clear record. That, more than anything else, should be our single greatest source of concern.