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What I worry about MOST with the president's SS plan is the cost. Those millions of small accounts would be very expensive to run. The management and transaction fees would have to be relatively high, which would have to eat into returns in a big way.
Then there is the little issue of borrowing trillions of dollars to fund the transition. Bush seems too quick to borrow gargantuan sums of money with no thought to the cost of paying it back. Imagine the interest on $2 trillion or $3 trillion over 30 years or so. It's another huge cost.
Plus, what is there now that keeps people from investing money for retirement? The idea that "the Democrats don't think people can invest" is silly. It's just that the guaranteed benefits from Social Security are supposed to be the foundation upon which you build a retirement nest egg. And putting that at unnecessary risk for what are (let's face it) ideological reasons IS reckless. A long-term bear market could put lots of people in a world of hurt.
Nobody ever said Social Security doesn't need to be fixed. But we need to fix it in a responsible way. And Bush's plan seems so far to be better for Wall Street (who'd collect the fees) than for the population. In actuality, Social Security is about as solvent now as it ever has been. So Bush is dead wrong when he says that the sky is falling and only radical changes will save the system. Raising the retirement age, collecting taxes on slightly more income above the $90,000 limit, or even allowing the system itself to diversify its holdings (making it more like a pension fund) might work better.
I don't think means-testing is a good idea, though.
I also wish Bush would stop blowing smoke up our national arse by implying that no sacrifice will be needed to implement his vision to remake the world. A series of new wars in the Middle East really really WOULD require a military draft and sharply higher taxes.
If he really thinks his "mission from God" is worth the cost, then he needs to start leveling with the American people and make his case for why it'll be worth it.
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