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View Diary: Why do Republicans hate Social Security? (218 comments)

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  •  Existing 'funds' can't be moved in that way (2+ / 0-)
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    Dallasdoc, BoxNDox

    It is just not that kind of wealth.

    I have been arguing this point with some policy people in Washington and some of them are only half convinced, but that is mostly the straight policy people, I am not getting any push back from the numbers guys, including one guy who held some top positions at both CBO and SSA and hasn't been shy in the past at telling me where to get off when I screw up the numbers and concepts.

    The best analogy is that the Trust Fund is like home equity. It is real wealth to the homeowner as long as the market holds up, but it is only wealth that can be extracted from the banksters, they can't extract it as such. Now the banker can try to monetize the resulting piece of paper but in so doing are not extracting anything more from the homeowner.

    The difference between the static wealth locked up in the TRust Fund as against home equity is that the former is fully backed by Full Faith and Credit. But again in the real world that is just the ability to extract cash from the banksters and not the other way around. Trust Fund assets are anchored in much the same way that house value is, just guaranteed.

    The argument pushed by the Sloan/Samuelson/Krauthammer folks is not total wrong, not from the perspective of the bankers, those funds in that sense have no positive economic value. Unfortunately for them we still live in a democratic society and that wealth can only be stolen with our consent. There only recourse is to trick us into thinking it is already stolen (the 'phony IOU' argument) or Go Big and simply argue that poor people and workers should be stripped of the right to vote.

    And of course they are tying both tracks. But the fact is that the only money that can be moved into privately managed accounts is new money, and any new money diverted from paying current benefits (as almost all of it is today) just means drawdown on existing assets which means transfers FROM the banking class to redeem Trust Fund Treasuries.

    Which is how the same pile of money can be both an asset and a liabilty to the same overall class of people, because that largest class breaks down into two overlapping but non congruent sub-classes, and the flow of funds going forwards is set to flow the wrong direction. At least as banksters and the media and politicians they support see the question, most of whom are set in the non-overlapping section where it is almost pure liability.

    Please visit, follow or join our Group: Social Security Defenders

    by Bruce Webb on Fri Sep 23, 2011 at 12:23:30 PM PDT

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    •  That's just untrue (2+ / 0-)
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      pot, yaque

      SS T-bills can be redeemed at any time. You even state that in your other comments.

      If SS were privatized, the money could be moved to other investments like the stock market in a matter of days, where banksters can play all kinds of games to skim it.

      "What could BPossibly go wrong??" -RLMiller "God is just pretend." - eru

      by nosleep4u on Fri Sep 23, 2011 at 11:19:47 PM PDT

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