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View Diary: Hell No! No Grand Bargain. How did we end up with Social Security in the first place? (16 comments)

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  •  What annoys the Soc Sec opponents (9+ / 0-)

    Before the 1970s, Social Security was not inflation indexed and was pay as you go.

    Nixon of all people fixed the indexation problem (to thank all those retirees for hating on hippies and re-electing him) and Carter started the process of making it into a self-funding system.

    The result was a system that works well.  This infuriated conservatives because it hits just about everything that props up their belief system.  (They were unhappy enough about the corporate pension system, an artifact of WW2 wage-price controls.)  The motivation for inventing things like IRAs and 401(k)s was to build an "alternative" system based on conservative values (e.g., they are individualized as opposed to an insurance based system like social security).  Of course, the limits for contributions are intentionally too low to save for retirement, and rather interestingly, 401(k) investments are governed by employers until you leave.  Recall that Enron invested it all in their own stock.  Of course, the whole system built a huge aftermarket of investment advisors, plan administrators, and other bureaucracy (but pointless and unproductive private sector bureaucrats aren't public employees, so their larger incomes and lower productivity compared to public employees is OK.)  At some point, Wall Street saw that pile of money in retirement accounts -- not subject to the growing body of laws about pension fund governance -- and their eyes started watering.  Suddenly the conservatives had a new and powerful ally and the rest is history.

    •  Gubmint not SPOSED to work! (8+ / 0-)

      As l.d. points out the root of hostility to Social Security. It has nothing to do with solvency, or the better efficiency of markets or anything else than objecting to the idea that government and or collective social action can do anything better than individual effort exercised through the 'Free' market.

      Ultimately hostility to the New Deal is Faith Based hatred of Heresy. And the arch Heretic "I welcome their hatred" Franklin Delano Roosevelt.

      Sure greed is part of it, and maybe the deep root of it, but ultimately it comes down to a deep hatred of the whole concept of democracy. Which a couple of hundred years ago was openly equated with 'Mob Rule' 'Anarchy' and perhaps worst of all 'France'.

      At the risk of being totally pedantic the roots of modern movement conservatism date back to Edmund Burke's "Reflections on the Revolution in France" (Hint-he didn't approve of all the 'Liberty, Equality. Brotherhood' stuff)

      SocSec dot.Defender at - founder DK Social Security Defenders Group

      by Bruce Webb on Fri Apr 12, 2013 at 06:08:07 PM PDT

      [ Parent ]

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