Thursday, February 03, 2005

Bush Social Security Plan Translations

No one over 55 will have their benefits cut = everyone under 55 will have their benefits cut.

No mention of how to pay for private accounts = $2 trillion of debt = $3-4 trillion in future taxes.

Private accounts = if the stock market goes up, you might be able to cover the benefits you lost and your share of the $3-4 trillion in future taxes. If the market doesn't go up, good luck.

The ownership society = when Bill Clinton was president home ownership and stock ownership increased enormously. Bush wants the credit. After all, he thought up a great slogan.

Plan in a nutshell: social security faces a shortfall in 2042. There will be no increase in taxes so benefits will be cut. Additional money will be withdrawn from the system to pay for private accounts, which promotes ownership, increases returns and increases risk. Even though benefits will be cut, we will still borrow trillions to fund the accounts and pay even more trillions in taxes to pay off the debt after Bush has left office.

What a deal.

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