Thursday, 06 April 2006
Bush's Bid to Blame the Old Folks
Crabby Old Lady is coming a little late to this party, but mainstream media has not mentioned it and it’s - well, just so Freudian a revelation from our president.
On 21 March, at a press conference, President Bush blamed the size of the national debt on Social Security. It came about when a reporter, noting that Bush has never vetoed a bill, asked the president if he is satisfied with the large increase in the national debt (now at $8.9 trillion) during his presidency.
Although many spending bills that do not include mandatory increases cross a president's desk, Mr. Bush answered thusly:
“As you know,” Mr. Bush answered, “the president doesn’t…veto mandatory spending increases. And mandatory spending increases are those increases in the budget caused by increases in spending on Medicare and Social Security…“That’s why it’s important for us to modernize and strengthen Social Security and Medicare, in order to be able to deal with the increases in mandatory spending…
“In terms of the debt, mandatory spending increases is driving a lot of that debt.” [Crabby is not responsible for the president’s grammar and syntax errors.]
Crabby is uncertain if this is a deliberate manipulation of facts in hopes that Americans don’t understand how Social Security works or if the president himself doesn’t understand.
Mr. Bush twisted his response into a another chance to beat the dead horse of Social Security privatization and, in essence, blamed the deficit on greedu geezers and disabled people. As though an unwarranted war, tax cuts for the rich and billions in pork barrel projects funding bridges to nowhere don’t count.
In case anyone else is confused, by law Social Security is treated as an “off-budget” entity. Contributions are held in and benefits paid from an account separate from the federal budget and therefore have no relationship to any deficit or surplus the government runs. It is absurd to state otherwise.
Posted by Crabby Old Lady at 05:59 AM | Permalink | Email this post
Comments
So presumably he lied or he doesn't know what he's talking about - tough choice!
Posted by: ian on Apr 6, 2006 6:33:12 AM
GWB should have to live on Social Security. Build one less B-1 bomber !
Posted by: Paul on Apr 6, 2006 8:24:00 AM
As I've said, often Mr. Bush is an embarrassment with a very high price tag! Dee
Posted by: Dee on Apr 6, 2006 10:28:21 AM
Based on other ramblings from Shrub, it doesn't understand - anything. I agree - he should have to live in Social Security. Oh, how I could go on about him.
Posted by: karen on Apr 6, 2006 10:46:20 AM
Some thoughts on SS and Bushisms.
Our government has been borrowing for years from the Social Security surplus (funds coming in that are over and above what is paid out to SS recipients.)
The government uses these funds borrowed from SS Surplus funds for general expenses or anything they need it for. They pay the Trust Fund (or owe the Trust Fund) a low rate of interest for the use of the SS funds. Therefore the debt that the government owes to the SS Trust Fund is as legitimate as debts owed by the US to China and other foreign countries.
Paul Krugman had an explanation of the SS Trust Fund in a NYT column last year..Check out http://driftwoodinspiration.blogspot.com/ for the rest of the story.
Chancy
Posted by: Chancy on Apr 6, 2006 9:21:22 PM
My blog is not working right now so I can not post the rest of the story. If this is too long, Ronni, just delete it please.
Some thoughts on SS and Bushisms.
Paul Krugman had an explanation of the SS Trust Fund in a NYT column last year..Check out http://driftwoodinspiration.blogspot.com/ for the rest of the story.
Chancy
----------------------------- OP-ED COLUMNIST
Stopping the Bum's Rush
By PAUL KRUGMAN
Published: January 4, 2005
(exerpt)
The people who hustled America into a tax cut to eliminate an imaginary budget surplus and a war to eliminate imaginary weapons are now trying another bum's rush. If they succeed, we will do nothing about the real fiscal threat and will instead dismantle Social Security, a program that is in much better financial shape than the rest of the federal government.
In the next few weeks, I'll explain why privatization will fatally undermine Social Security, and suggest steps to strengthen the program. I'll also talk about the much more urgent fiscal problems the administration hopes you won't notice while it scares you about Social Security.
Today let's focus on one piece of those scare tactics: the claim that Social Security faces an imminent crisis.
That claim is simply false. Yet much of the press has reported the falsehood as a fact. For example, The Washington Post recently described 2018, when benefit payments are projected to exceed payroll tax revenues, as a "day of reckoning."
Here's the truth: by law, Social Security has a budget independent of the rest of the U.S. government. That budget is currently running a surplus, thanks to an increase in the payroll tax two decades ago. As a result, Social Security has a large and growing trust fund.
When benefit payments start to exceed payroll tax revenues, Social Security will be able to draw on that trust fund. And the trust fund will last for a long time: until 2042, says the Social Security Administration; until 2052, says the Congressional Budget Office; quite possibly forever, say many economists, who point out that these projections assume that the economy will grow much more slowly in the future than it has in the past.
So where's the imminent crisis? Privatizers say the trust fund doesn't count because it's invested in U.S. government bonds, which are "meaningless i.o.u.'s." Readers who want a long-form debunking of this sophistry can read my recent article in the online journal The Economists' Voice (www.bepress.com/ev).
The short version is that the bonds in the Social Security trust fund are obligations of the federal government's general fund, the budget outside Social Security. They have the same status as U.S. bonds owned by Japanese pension funds and the government of China. The general fund is legally obliged to pay the interest and principal on those bonds, and Social Security is legally obliged to pay full benefits as long as there is money in the trust fund.
There are only two things that could endanger Social Security's ability to pay benefits before the trust fund runs out. One would be a fiscal crisis that led the U.S. to default on all its debts. The other would be legislation specifically repudiating the general fund's debts to retirees.
That is, we can't have a Social Security crisis without a general fiscal crisis - unless Congress declares that debts to foreign bondholders must be honored, but that promises to older Americans, who have spent most of their working lives paying extra payroll taxes to build up the trust fund, don't count.
Politically, that seems far-fetched. A general fiscal crisis, on the other hand, is a real possibility - but not because of Social Security. In fact, the Bush administration's scaremongering over Social Security is in large part an effort to distract the public from the real fiscal danger.
There are two serious threats to the federal government's solvency over the next couple of decades. One is the fact that the general fund has already plunged deeply into deficit, largely because of President Bush's unprecedented insistence on cutting taxes in the face of a war. The other is the rising cost of Medicare and Medicaid.
As a budget concern, Social Security isn't remotely in the same league. The long-term cost of the Bush tax cuts is five times the budget office's estimate of Social Security's deficit over the next 75 years. The botched prescription drug bill passed in 2003 does more, all by itself, to increase the long-run budget deficit than the projected rise in Social Security expenses
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http://www.nytimes.com/2005/01/04/opinion/04krugman.html?ex=1262581200&en=baf5ae98e5c14a92&ei=5090&partner=rssuserland
So Bush lies.
Posted by: Chancy on Apr 6, 2006 9:27:58 PM
Everytime he opens his mouth, he is an embarrassment.
Posted by: kenju on Apr 6, 2006 10:00:53 PM
I ask myself that every time I hear Bush speak: "Is he stupid enough to believe what he's saying? Or does he know he's lying?"
Posted by: Mary Ann on Apr 7, 2006 12:03:44 AM
HAPPY BIRTHDAY, RONNI!
Posted by: Robert Brady on Apr 7, 2006 12:18:51 AM
Good to read Krugman's NYT article re Soc. Security from '05 again. Thanks for posting, Chancy/Ronni.
As for our leader, it's, indeed, frightening to think he doesn't understand Social Security in relation to the budget; worse than insulting, to think he might deliberately prevaricate.
All too often I find myself resenting his condescending words and manner that convey a clear presumption the citizens of this country aren't intelligent enough to understand even the simplest of issues much less the more complex ones. Perhaps he erroneously assumes we are incapable of analytical abilities at or above the level at which he expresses.
Posted by: joared on Apr 7, 2006 12:55:46 AM
Ronni,
While I do not ordinarily use other bloggers' comments space to tout my own contributions, I invite you to check out my latest post. In all honesty, I think it's one of the best I've ever written, and certainly the most heartfelt.
Posted by: Deejay on Apr 7, 2006 1:16:26 AM
Ronni, stop by my place to see my message to a special lady on her special day. Happy Birthday sweetie!
Posted by: Joy on Apr 7, 2006 1:31:06 AM
Happy Birthday Ronni!
Posted by: donna on Apr 7, 2006 1:35:58 AM
Hey Ronni, little birthday something for you over at my place.
Posted by: Rana on Apr 7, 2006 1:55:45 AM
