A recent
point-counterpoint on Social Security steered clear of the usual talking points. The case against privatizing was made by Mark Weisbrot of the Center for Economic and Policy Research, who used details of the president's plan as spilled by a "senior White House official". One of those details:
The money that will go into the private account isn't really yours. At the end of your working career, you have to pay it all back to the government -- plus interest: at the rate of U.S. Treasury notes.
Treasury notes? You mean those "worthless IOUs" in the trust fund?
The difference between what you made in your private account and what you have to pay back, with interest, is your "profit" -- or loss.
Derrick Max, you ignorant slut! More after the break.
But that's not the end of the story:
There are administrative costs that will reduce your accumulation by 5 percent -- according to the President's Commission to Strengthen Social Security. Or possibly a lot more: In a typical private 401(k) account, it's about three times that much.
You're still not home free:
The president's plan will require you to convert some or all of your accumulated sum to annual payments for the rest of your life. But this conversion is not cheap: In the private sector, it costs 10 to 20 percent of accumulated savings; if the government does it, maybe it can be kept to 5 percent.
Here's the real kicker:
Interestingly, when the government takes back the money that it lent you, it doesn't come out of the private account that it went into -- it is deducted from the benefit you receive from the traditional Social Security program. This will create the illusion that most of your benefits come from the private account -- rather than from the traditional system. This indicates that the people who designed this privatization scheme want to undermine support for the traditional Social Security system -- so as to get rid of Social Security as we know it altogether.
Wow! That means they're trying to pull strings now in order to mislead people 13 years in the future when they start retiring. I suppose that nothing these people do should surprise me at this point.