NYT: Bush Says Social Security Plan Would Reassure Markets

[DeepModem Mom]

Bush Says Social Security Plan Would Reassure Markets
By RICHARD W. STEVENSON

Published: December 17, 2004


WASHINGTON, Dec. 16 - President Bush said on Thursday that addressing the long-term problems in Social Security would reassure the financial markets, offering a rationale to offset criticism that his plan to add personal investment accounts to the retirement system would require up to $2 trillion in new government borrowing....

***

As he did throughout his re-election campaign, Mr. Bush largely avoided talking about the specific steps to assure the long-term solvency of Social Security. Social Security trustees estimate that if no changes are made, the system will start running short of money to pay full benefits to retirees in 38 years.

In particular, Mr. Bush never mentioned the near certainty that without raising taxes, which he has ruled out, any plan to add personal investment accounts to Social Security and improve its financial condition would include a reduction in the guaranteed retirement benefit....

***

Mr. Bush cast dealing with the long-term problems of Social Security as part of a broader fiscal policy approach under which he would also meet his promise of cutting the budget deficit in half over five years.

The president has not fully explained how he would sharply reduce the deficit while also absorbing the costs of his Social Security program, pursuing new tax cuts and paying for the war in Iraq....


http://www.nytimes.com/2004/12/17/politics/17econ.html

[havocmom]

1. It is SUPPOSED to reassure RETIREES

Friggin idiot CEOs have run out of victims to fleece with their worthless stock certificates. Let them go the way any bad product/service would in the free market they are always mouthing platitudes to while working furiously to control the game board.

Bad companies, lying accountants, BS CEOs fucking everyone and then bailing with golden parachutes... THAT is not what Social Security was designed to help!

[Cobalt Violet]

2. This use to be the "Third Rail" of politics.

WTF is wrong with sheeple these days.

[havocmom]

3. What's wrong with people? Let me adjust my tinfoil bonnet a bit...

ah, that's better.

Now, back to your question. I keep remembering back at the beginning of the malAdministration, there was this little bitty news story about DOD trying to figure out how to administer 'calming drugs' to massive urban populations, ostensibly to make our troops safer in the event we invaded anyone and had to subdue a hostile population.

My guess is they got their drug and their method. Just don't think they are administering it where the troops are.

[laheina]

11. LOL

Sheeple: that's funny as hell :)

[Hard Attack]

4. I have been saying that this move is a bail out of the stock market

I have been saying for sometime that this 'invest' in the stock market is a ploy to direct money into a flat market.

The multiple 2 for 1's that went on for a decade in the 90's have caught up with reality, there are just too many damm stocks out there.

Not companies, but the stocks of companies.

General Electric has something like 9.9 billion outstanding shares last time I looked.

Microsoft is in the Billions,

Lucent, in the Billions, I can go on and on, but just look at who is on the dow and see how many outstanding shares they have.

The Fat Cats want this, it will be a whole new consumer base coming in with 'the Buy', so the Fat Cats who are sitting on all of these shares can 'Sell' without the price collapsing.

Funny, how this story of Bill Frists Campaign losing like a half a million dollars in the stock market doesn't make it to the mainstream press....
http://tennessean.com/government/archives/04/11/62186658.shtml?Element_ID=62186658

This is just another wish list for the Bush Supporters, and it will be another nail in the coffin for the future of this country.

[huellewig]

5. I think that nails it.

Imagine the huge jump in the DOW and NASDAQ after all this cash starts pumping in. Two days later when the big boys grab the cash and run things start to collapse. Well, the big holders in the market can make a killing. While the little new marketers don't have a mechanism to sell off and gain some of the profits. Even if they knew how I wonder if they would be able?

Any info on this? Could I go to a webpage and move my cash from IBM to Enron? I would think it would be like a giant 401K. How quickly could I switch between categories? Would I have control over individual holdings?

Or would we see something like the GOP100 and the gov decides to add stocks to the index as the lobbyist see fit? Hey, Halliburton just got added, two days later the VP sells off his shares.

Any details on this plan? I imagine the plan is roses and candy when the results might be something very different.

[w4rma]

6. If that's the case they are going to drop now or drop later.

I'd rather they drop without taking down 2 trillion dollars + Social Security funds with them.

[laheina]

13. No kidding.

This would prop up the market for a few days, weeks, and then what? If this perspective is right, then it's a seriously long term cost for a very short term benefit.

[LizW]

9. Good points

I never thought about it that way. If a ton of money suddenly flows into the markets (and out of Social Security) the big investors can quietly dump their stocks and take the cash under cover of the big inflow. The market will stay flat no matter what. The folks who are going to be depending on that money to "grow" might just as well write a check directly to the big players. And they get it from both ends: guess who gets to pay off the gigantic debt incurred in the switchover?

Direct transfer of wealth, the Republican's dream.

[Bono71]

21. I am against the privatized account, but I'm not sure I follow your

concern about "too many stocks out there" analysis.

[Art_from_Ark]

28. It's called "dilution"

It works the same way as issuing too much paper money at one time

[Ganja Ninja]

7. If Social Security is needed to reassure the stock markets then

maybe we should take a small percentage of every stock transaction and put it toward Social Security.

[hatrack]

19. I wasn't aware the markets needed "reassurance" - aren't they big boys?

Do the markets also need a bedtime glass of warm milk? Perhaps we could also have the White House tuck the markets in and read them a story.

Oh, sorry, that's what they're doing now - "Once upon a time, there was a president who wanted to provide Wall Street with an enormous dick-splint at taxpayer expense . . . "

[Art_from_Ark]

26. Reading the markets a bedtime story

like "The Very Hungry Caterpillar"

or

"The Very Greedy Chimpanzee"

[librechik]

29. why doesn't he allow the markets to work freely?

If they are meant to go down, surely that is what they deserve for poor performance. He wants; to let the mkarket determine everything else. Isn't that what he's alway's preaching? Why does he want evil government to rescue the market? Are conservatives even listening to this Stalinist swill the Shrub is shedding?

[truthisfreedom]

8. ahh, so this explains why he's let the markets begin to go to hell.

simple stategery.

[elehhhhna]

10. They're where they are today in anticipation of this scheme...

they need the capital. BA says the $$$ will be directed toward mutual funds. You know, the ones Spitzer just busted for letting institutional shareholders trade AFTER CLOSING and after the funds had been priced for the day.

[underpants]

15. Or propped up to show how much MONEY you can make

When the money comes raining in (hopefully it won't) expect the "profit takers" to appear.

Hey what happened to my money?
Well see that is the risk you take.
But my retirement is now only 80% of what it was
Work harder.

[wicket]

12. Controlling DEFICITS would reassure markets!

Bush is such an asshole :grr:

[laheina]

14. Yeah.

But he wouldn't get to steal our money that way.

[underpants]

16. THERE IS NO CRISIS- this deficit in 2013 is complete BS

yes expenses might be greater than revenues directly but the T-bills that the trust holds keep it solvent until 2042 by the most conservative estimates and 2052 by realistic estimates.

[DeepModem Mom]

17. Well, you've outed yourself as a liberal, underpants -- from the article:

"There were no real dissenting viewpoints from the panelists. Away from the conference, some opponents of Mr. Bush's approach, mostly liberals who want to preserve the current Social Security program, said in interviews that the administration was exaggerating the scale of the problem to create an air of crisis that justified radical but unnecessary changes like creating private investment accounts.

Noting that Social Security can pay full benefits for at least 38 years, Mark Weisbrot, co-director of the Center on Economic Policy Research, a liberal research group, said the system's financial condition now was no worse than it has been at most points in the last few decades.

'This whole idea that Social Security needs to be fixed is false,' Mr. Weisbrot said."

[underpants]

18. Damn... AGAIN! Darn those pesky facts

They get in the way of a full scale lie all the time.

[Rose Siding]

24. But think of it! Whiter teeth, fresher breath..

AND reduced deficits. Better?

[DS1]

20. Whatever Bush says doesn't happen

I'm about to start shorting stocks, hell, I'll be swimming in cash in 4 yrs.

Eh, I'm too ethical or something, shorting always seemed so underhanded.

[C_eh_N_eh_D_eh]

22. Yeah, reassure them that they can keep soaking the American people.

[genieroze]

23. Bush Says Social Security Plan Would Reassure Markets?

Bush should take his head out of his butt.

Another thing is Bush wants to reASSsure the markets, get people their jobs back so they can invest in the markets.

edited to add another thing.

[drscm]

25. And Soc Sec is for the markets? I thought it was for the retired?

[EFerrari]

27. Paul Krugman has a good column o this today in NYT

http://www.nytimes.com/2004/12/17/opinion/17krugman.html?oref=login&hp

Buying into Failure
As the Bush administration tries to persuade America to convert Social Security into a giant 401(k), we can learn a lot from other countries that have already gone down that road.

Information about other countries' experience with privatization isn't hard to find. For example, the Century Foundation, at www.tcf.org, provides a wide range of links.

Yet, aside from giving the Cato Institute and other organizations promoting Social Security privatization the space to present upbeat tales from Chile, the U.S. news media have provided their readers and viewers with little information about international experience. In particular, the public hasn't been let in on two open secrets:

Privatization dissipates a large fraction of workers' contributions on fees to investment companies.

It leaves many retirees in poverty. . . .