The mid-week Bush State of the Union Address kick-started the previously rather quiet discussion of Social Security.  Bush made it a big deal – the centerpiece of what he wants to do in his second term.  But why that?

Perhaps it is because the war in Iraq is old news – or because that after the elections there, as the votes are counted, it seems the slate of the United Iraqi Alliance - mainly Shiite religious parties – is pulling ahead.  Hello, Grand Ayatollah Ali Sistani and goodbye interim Prime Minister Iyad Allawi!  This United Iraqi Alliance as of this weekend is poised to control two-third of the new parliament, which is to write the new constitution.  The Sunni folks now say they want in somehow – they want at least some representation.  But no matter what the Sunni folks want, or the Kurds, Iraq seems to be heading toward a severely theocratic nation of strict Muslim law, with close ties to Iran.  Well, heck, we gave them the vote.  Let’s not talk about how they voted.

So let’s talk about Social Security instead, which is not in as bad shape as some other government entitlement programs – like Medicare and Medicaid – but could use some fine-tuning.  There is much debate about whether Social Security will go broke in 2042 or not, and that seems a long way off, and probably not even true.  But now it seems to be the crisis we must face, and face immediately.

This makes no sense.  There’s something else going on here.

The debate about Social Security, as a number of my conservative friends keep reminding me, is really not about the program going broke – as it may not ever go broke, or may one day, depending on many ways of looking at the data – and is really not about private or personal or whatever accounts.  It is about the whole concept of the “safety net.” 

Damn.  It’s always about something else.  The Iraq war wasn’t really about weapons of mass destruction and any immediate threat.  Not was it about payback for Iraq supporting terrorism – Saddam’s ties to Osama.  Where did any of get these ideas?  Weren’t you paying attention?  It was about something else, you dummies!

Just so with Social Security.

Here’s the deal -

Start with the proposition that it is not the responsibility of the government to provide any sort of support for those who are unlucky or dumb or lazy enough to not do well.  These people should not be rewarded, certainly not with the hard-earned funds of those who did achieve some success in this world.  It’s a disagreement about social policy, and the role of government.  Social Security is just a convenient metaphor for something else.

The something else is an idea of what government is actually supposed to do.  The nig idea is that any government should encourage people to just grow up and assume personal responsibility.  Assume it and there are rewards - if you are good at playing the markets right and making shrewd real estate buys and sells.  Avoid personal responsibility and you pay the price – or now you will if things can be changed.  The change?  Reward rugged independence.  Punish leaching on the successful – on those of real character.

As one of my conservative friends has said – why should HE pay for YOUR cushy retirement when YOU didn’t have the foresight to plan for it, and now YOU choose to use HIS hard-earned money for YOUR personal pleasure? 

It’s a matter of personal responsibility.  The role of the government is to encourage you to assume personal responsibility – and to assure your do.  Thus welfare programs and minimum wage laws - and your opportunity to sue for malpractice, or for damages from a faulty product or for fraud and so on, are all wrong – as they encourage people to either feel “entitled” or to feel they are victims. 

What sticks in his craw is how social policy since FDR has, as he says, “infantilized” the American character – and made us a nation of spoiled kids expecting someone else to take care of us.  Bottom line – the government since FDR has systematically destroyed the American character with “safety net programs” and regulations and tort law that allows you to sue businesses.   All this has done far more harm than good – and must stop now.  Thus the crew in Washington now wants to fix things.

The latest wrinkle on this?

Kevin Drum with a comment on basic economic ideology –

The basic economic argument behind Social Security privatization has always been simple: In order to solve Social Security's future deficit, we have to cut benefits. But if we give everyone a private account invested in the stock market, the returns from the accounts will be high enough to make up for the benefit cuts.

You might recognize this as the same kind of free lunch argument beloved of supply side enthusiasts in the early Reagan years. Back then, the idea was that if we cut taxes, the resulting economic boom would provide the government with more tax revenue than it would have had in the first place.

Reagan's budget director, David Stockman, figured out pretty quickly that the supply side fantasy was a ruse — a "Trojan horse" to bring down tax rates for the wealthy, he called it — and no one aside from a few dead enders pretends to believe it anymore. Now, via Josh Marshall, it appears that George Bush has quietly stopped talking about the private account free lunch as well:

A Bush aide, briefing reporters on the condition of anonymity, was more explicit, saying that the individual accounts would do nothing to solve the system's long-term financial problems.

That candid analysis, although widely shared by economists, distressed some Republicans.

"Oh, my God," one GOP political strategist said when he learned of the shift in rhetoric. "The White House has made a lot of Republicans walk the plank on this. Now it sounds as if they are sawing off the board."

Now why would Bush do this? Possibly because he's finally realized he just won't be able to get away with continuing the pretense.

          [ Go to the link for the detailed argument with graph… ]

… The bottom line is that private accounts by themselves don't improve the solvency of Social Security. They actually make it worse.

And now, for extra credit, answer this question: if private accounts don't solve anything, if indeed they actually make Social Security's problems worse, then why is Bush pushing them?  Cui bono?

My conservative friends have the answer.  People should grow up.  But the pretense of fixing a crisis is useful.

Just Above Sunset contributor Phillip Raines sees it the other way -

Success breeds greed.  Fortune fosters distain.  Why should you share your success with the unlucky and dumb, and not at least be able to pick who you are generous to?  One friend of mine, seduced by his success in real estate, gave me an example of his generosity by saying he gave the maid his old towels - and sang to the elderly with church people.  There, that should do it. 

Questions befuddle us all.  Why should a real estate agent get 20K for selling a 600K house when it only took twenty-five hours of his attention (let’s not call it work)?  Shall we stop the cut at say two grand per transaction? 

Now capricious restraints seem less just.  It's not fair when circumstances make libertarians unlucky.  The stupid part comes from an inability of empathy - and from a binary sense of analysis. There is black and there is white.  There is some and there is none and that is that. 

But Bush should be concerned about Social Security.  His debt and sloppy math will leave no money for anything, and left to his witlessness he will ruin it for us all.

Yipes!  We have a conflict here.

Our friend Vince – who teaches at a major business school – adds this –

Echoing Philip's line - Social Security was never meant to make it cushy for those on the bottom rung at the end of the game - the safety net idea was just that - subsistence guarantees.  And as a freewheelin' economically driven realist I say that even the single-minded 19th Century "industrialists" (let's not call them robber barons - for they are the perfect model of poli-economic monopoly and affiliated corruption we live with now!) - even those industrialists in their generosity should have been forced to acknowledge that economics is closer to a net-sum zero game than not.   Succeeding in business means acquiring an abundance of fixed resources at SOMEONE'S expense.  So you win more toys!  Great!   The bumper stickers are just plain - childishly - wrong.  The Tiny Tim's of the world are there by misfortune and not by choice!  We've even had a tsunami in our midst to remind us of the human condition, for God's SAKE!

Everyone cast(e) toward the bottom is not there by there own hand.  And anyone who thinks that life's challenges are somehow earned or side-stepped with a direct sense of justice in one person's short lifetime, simply hasn't had enough years on earth - or the right social experiences - to grow up!

In the end I look at the enormity of the wealth we've aggregated in this country.  (Net sum zero?  And all wars ARE economic - modern terrorism HAS to be tied to simple envy for resources - at SOME level here).  Ultimately I succumb to both mortality and morality and have to cry "God Bless us ALL, Tiny Tim!"

Well, now we’re down to the core.  Are economic woes a product of lack of character?  If so, well, one can see how the other side resents supporting those with character faults, those who choose misfortune and expect to be saved.

Just Above Sunset contributor Dick in Rochester adds this -

Probably fewer of us would have a problem with the conservative viewpoint if we ever saw something remotely approaching a level playing field.  If W (for example) did not start off with the silver spoon and umpteen connections (elite schools in spite of his grades, non-existent military service, the opportunity to blow a couple of huge business deals - with no repercussions and all the rest) I would say, "Yeah, why should anyone worry about my future?"  But that ain't gonna happen.  If you read the book, Perfectly Legal, or an older one called Rape of the Tax Payer - both of which have pages and pages explaining more than tax generous laws written, at times, to benefit only one person, the pittance we get from Social Security is almost laughable - except for so many people depending on it.

But then again, Social Security isn’t the “real” issue.  The real issue is the tension between the social contract (our interdependence and responsibilities to each other as a community) and personal responsibility (our desire to be autonomous, free, independent beings).

Whoa, heavy, isn’t it?

When I posted some of this over at the Washington Monthly I did get a few instant responses.

Alan, kudos to your conservative friends for at least honestly articulating what used to be the conservative case against the New Deal.

Still, I always wonder about people like that on two levels. One is their assumption that all of our economic success in life is due to our own intrinsic moral character, a rather inane assumption.

But the second level is more important. Did they never read the preamble of the constitution? Here's what it says:

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

I don't notice anything in there about forming the United States so that we can institute a market economy and let the chips fall where they may, but then again, I suppose I’m a strict constructionist on the matter of the preamble....

And this -

As my one of my conservative friends has said - why should HE pay for your cushy retirement when YOU didn’t have the foresight to plan for it, and now you choose to use HIS hard-earned money for YOUR personal pleasure?

Sounds like the flip side of "Me, Me, It's All About Me!"  Same tune but a different arrangement.  Perhaps should be entitled, "Mine, Mine, Mine!"

Uh, hm, do these people also realize that people have for decades been paying into the safety net with their hard-earned tax dollars, some of us contributing more than others.  But hey.  Screw them.

I wonder how they feel about Enron, WorldCom, etc., employees who were personally responsible paying into personal retirement plans faithfully for years, some decades, only to be ripped off by corrupt management and to end up with zilch?

And this –

Yes, I've heard the same thing and there are similar themes in the Dominionist viewpoint.

I wonder if Americans will figure out that the cooperative collective is stronger and works better than this current Me v. You state of our union. Didn't we learn some of this lesson from the Civil War?  The United States.  The EU is figuring it out economically.  Watch China.

I bet your friends are dead set against, say, universal health care.  Yeah, I bet.

Now Medicare/Medicaid... there's a reality-based crisis.  Why isn't THIS on the agenda NOW?  It's in worse shape than Social Security.

And this –

I would ask your friends to visit Palm Beach, Florida some day or other exclusive gated compounds that are springing up like mushrooms on rotten fruit across our land (that is, if they will let them enter). There they will meet those who feel true "entitlement".  They feel they are entitled to everything.  There he will see, first hand, "infantilized" behavior.  There he can attest to the essential frivolity of a life spent trying to spend untold wealth.  There he will begin to understand the social recklessness that supports this administration's ideological drive to take this country back to a time long gone and never to return.  Wishing will not make it so.

And perhaps you should remind your friends that any money they have is essentially our money, and he should be grateful we let them keep some of it.

This is our social contract, if they believe in the "law of the jungle", then it would behoove them to go and live in one.

And so on.  There seems to some vastly different ideas of what government should do.  And this is what the debate is really about.

From my friend Joseph, an expatriate American in France, I got this, about having a debate about what you're really not talking about at all –

What I truly hate about this administration, and the disingenuous breed of "educated conservative" they secretly serve, is that there's just no having an honest debate with them.  Everything is "really about" something else! 

Iraq wasn't really about WMD, and the Social Security proposals aren't really about the Social Security system potentially going bankrupt.  It's about dismantling it.

Why do these guys never make the argument for their true beliefs?  For what it's "really about?"  Are there ideas so indefensible?  Or is it that Joe-Bob out in BFE wouldn't bite?

By pursuing this consistent dishonesty, they short-circuit the very mechanisms of responsibility and accountability they so cherish.  It's one thing to argue something, and not be fully cognizant of the fact that it's really something else that's on one's mind, "in one's craw" as you so sardonically put it.  The willful disregard for the truth, the disrespect of the people and of democracy demonstrated by this administration betrays the true nature of the "educated conservative" - they actually don't like democracy very much.  In fact, they hate it.

That seems a little over the top.  But it would be more honest to talk about the thing, not the symbol, about the thing in and of itself, and not about the shadow on the wall of the cave.

Just Above Sunset contributor Rick, the News Guy in Atlanta, responds –

BINGO!!!

Just this morning, I was marveling at the same thing! Much more so than the Democrats, the Republicans must constantly invent cover stories for themselves! It can't be easy for them.

And I think that you and I, a few years ago, touched on this business that they don't really like democracy -- although, not coincidentally, they even have to hide that fact!

The reason they can't come clean on what their true intentions are is that absolute candor would lose them votes, and they would never get their programs past the people.  For example, would there even be serious discussion of “reforming" Social Security right now if they admitted they don't like the program, never did, and want to dismantle it altogether?  The better way to do away with the program, if you can get away with it, is to fool lots of people into thinking you're just trying to "improve" it!

Take school vouchers (or what I think of as the "Virtually Every Child Left Behind" plan): Conservatives tend not to like public schooling, nor have they ever really cared about poor people's problems, so how clever of them to come up with a plan that helps dismantle public schooling by appearing to be looking out for select disadvantaged families who can't afford to send their kids to private school! Nobody ever seems to ask the obvious question

of how a "private" school is still "private" if it's taking "public" money, and even less effort is expended by these geniuses into figuring out how to insure the quality of the public schools left behind.  But then again, that would be beside the point.

The reason conservatives don't trust democracy -- witness how hard they fight "motor-voter" programs to increase voter rolls, for example – is that the larger the electorate, the harder it is to sell the sizzle instead of the steak -- and of course, the greater the danger that they will get outvoted!

As I may have mentioned before, we often overlook the best argument against these conservatives who think that, rather than to be looking out for the overall welfare of the country, the main (and maybe only) reason for our government to exist is for national defense:

They should be advised to simply read the preamble to the U.S. Constitution, in which we, the people, lay out what we want our government to do, to wit:

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

Of course.  We decided.  The reader at the Washington Monthly sees it.  Rick sees it.  But that was a long time ago.  It seems the issue has been reopened.

So?  Get to it.  Forget “democracy” and who hates it or doesn’t – and forget Social Security too.  What “they” hate is whining leaches who think the world owes them something and won’t get off their fat asses and do an honest days work – or something like that.  The government has no business encouraging these people.  The country would be better if we addressed that problem.  They just happen to be talking about Social Security at the moment. 

Just Above Sunset columnist Bob Patterson asks an interesting question about the Bush strategy in that regard -

Bush made an interesting comment in his State of the Unions speech.  He's against scaring you if you're 55: "I have a message for every American who is 55 or older: Do not let anyone mislead you.  For you, the Social Security system will not change."

Isn't AARP the biggest opponent for the change proposal?  How old do you have to be to join AARP?  Is it 50 or 55?  Could W be trying to neutralize his biggest group of opponents?

Just wondering.

And Just Above Sunset contributor Rick, the News Guy in Atlanta, clarifies matters from there -

How old do you have to be to join AARP?  It's 50.  At least that's when I first started receiving their junk mail, with membership cards enclosed. (I have yet to give in; I'm not a big fan of travel discounts, and I'm nervous about having my own personal lobbyist in Washington, running around asking for things I may not want.)

Could W be trying to neutralize his biggest group of opponents?

That's one way of looking at it.

Another theory is that Bush knows he won't go down in history as the conservative FDR by dismantling this onerous Social Security monster in a day and a half, so he figures he should try faze it out within this new generation.

So he tells the old folks not to worry, they won't be harmed - (of course not! they'll all be dead by the time the bill comes due!) - and then turns to the youngsters and reinforces their false assumptions that Social Security is such a loser that it wouldn't have been there for them anyway, so why not try hooking their destiny to that shooting star known as the "market," maybe even stocks - which, as everyone who ever read Peter Lynch's book "Beating the Street" knows, have traditionally done boffo, especially compared to all those stodgy treasury bonds that Social Security relies on.

For this argument to work, of course, you have to ignore the fact that this "doing better" thing only demonstrably averages better over a long period (such as between October of 1929 to now), but that, because the market does this in big jumps and drops, all smart financial advisors advise you to diversify your portfolio, with more of it "risky" when you're young and "conservative" when you approach retirement. Not that experimental private accounts are such a bad idea, but don't those people who can afford to take those chances already have this option?

Anyway - as I've mentioned to so many people that I forget if I've ever done it in this forum - I think the point is really this: There are essentially two sectors, being the "private" and "public" sector, and that whenever you hear a conservative talking about "privatizing" (or maybe "partially privatizing") a "public sector" program, you should be hearing "dismantling" (or "partially dismantling") that program.

And by the way, we should also be noting that the White House has been pushing the word "personal accounts" over "private accounts."  Why are they doing this?  Because talking about making something "private" reportedly scares folks into thinking about big corporations like Enron taking over, while "personal" makes it all much more warm and personal.

(Speaking of choosing words carefully, also interesting is how Bush backed off the "crisis" word this week, which should remind us how these folks used to accuse the Clinton administration of being so poll-and-focus-group-driven.)

Still, is not the Social Security program actually in a "crisis"?  Maybe it is!  After all, didn't Bush tell us, in spite of much evidence to the contrary, that Iraq was a crisis?  And sure enough, after the matter his undivided attention, and largely because of it, he turned out to be right!  So, yes, given enough focus from the White House, Social Security, too, will surely be in crisis.

But dare the Republicans mention the truth, which is that they're dismantling a signature Democratic program - one that, in fact, has served the country well?  Even conservatives the likes of William Kristol were heard on NPR this morning, arguing that the Republican-Democrat angle is what this issue is really all about.

Also, assuming it even matters, will whatever "reform" these guys come up with still be worthy of the name "Social Security"?  To me, it sounds like it will be neither "security" (as in, a guaranteed pension), nor "social" (as in, "we're all in this together.")

Finally, is the utility of Social Security a remnant of the past?

The Republicans seem to think so. Apparently they don't buy the idea that if they allow too many of us go hungry and homeless in our old age, it will come back later to bite them in the butt.  Personally, I think a nation that guarantees its older citizens a small nest egg to supplement their other, less secure retirement plans, is doing itself a tremendous favor.

And after all, what's the point of our even having a nation that doesn't look out for its own well-being?

PS: By the way, you've heard talk lately of how our huge deficits, along with borrowing the few trillion dollars needed to make this Social Security "reform" plan work, will lower the value of the dollar, making our bonds less attractive overseas, thusly necessitating our having to raise interest rates to sweeten the deal?  Well, please take note that, just this week, the Fed raised those rates, and with promises of more to come.

Rick reframes the core question in a direct way.  What's the point of our even having a nation that doesn't look out for its own well-being? 

That is where the disagreement is. 

On one side we have folks that think the well-being of the country is served by keeping the retired – the elderly – out of poverty with a government insurance program to which they have each contributed.  On the other side we have folks that think the well-being of the country is served by structuring things so no one depends on the government – everyone depend on themselves, and that makes things far better.  And thus the government has no business running an insurance program.  Of course they don’t want old folks to starve and die in the streets.  No one does.  But they do want everyone to stop thinking the government should assure that, as you should take responsibility for your own life.

Each side is concerned with the well-being of the country.  No point in demonizing each other.  They are wrong, as some of us believe.  But not evil.

I mentioned one conservative friend in particular.  He has this political ideology, but he and that political ideology are not one and the same thing.  He is more than that.  We remain friends even if we are miles apart on this core issue - what government is for.  We've argued it for years, over many a bottle of wine.  Neither of us budges, but we remain friends.  To some of you that may seem a sell-out on my part.  But like any silly liberal I tend to listen to the other side and try to see what they're saying.  And actually he often does the same.  But, as I said, neither of us budges.

I'm a sell out?  I don’t think so.  In short, there is more to life than political ideology.  You don't know they guy.

What's going one in all the heated comments on this topic – here and around the country?  Is someone feeling threatened?

The core issue is how to live in this world with others – and whether we choose to tip the scale toward maximum "personal responsibly" and minimum mutual support from the community at large, or tip the scales the other way.  Both have their virtues, and drawbacks. 

And that is why the nation will never be entirely one or the other, neither a Hobbesian every-man-for-himself jungle nor some all-property-is-the property-of-all socialist workers paradise.  It's always a mixed-mode mess we find ourselves in.  The far two ends of the spectrum are too damaging for either side to even consider.

The folks cited above, and those who think like Bush is and his crew a just flat-out wrong, leaning the one way, have had a good run for a long time - since the social programs to save things in the thirties.  The other guys are now in their ascendancy. 

It seems wise to nudge things our way, but recognize we are seeking one side of the middle.  My conservative friend is seeking the other side of the middle.

Of course the middle satisfies no one.  But that is where folks get along, even if they disagree.

FOOTNOTE:

This below is amusing – the best historical analysis I’ve seen about why the Republicans want to dismantle Social Security.  It’s a seventy-year-old grudge match.  As in “many Republicans are simply unable to forgive Roosevelt for what may have been his greatest and longest-lasting achievement: saving American capitalism through regulation. And since they can't tear down the Triborough Bridge or the Hoover Dam, these guys act out by going after Social Security.”

The thesis is simple – in 1929 the unregulated economy fell apart and FDR introduced enough regulation and taxation for the common good that it was able to recover and thrive, proving sensible regulation and taxation for the common good was actually GOOD for a free market economy.  What a bastard!

Key Quote:

Why are today's Republicans so hellbent on changing Social Security? Clearly they're not driven by concern over government deficits. After all, they've engineered a taxing and spending regime that intentionally created record deficits. And it can't be that they oppose entitlement programs as a matter of principle. Medicare has an unfunded liability larger than Social Security's, and they just expanded it a couple of years ago with the prescription drug benefit.

Maybe it's because Social Security is an opportunity to refight—and perhaps win—a series of arguments the Republicans lost badly 70 years ago. To put it another way, it's a chance to knock down Franklin Roosevelt, finally.

There is much social history here.

For 70 years, conservatives have been telling us that the American economy—whether it's in recession or whether it's booming—is laboring under the shackles of the burdensome taxation and misguided regulation placed upon it by FDR and his successors. Somehow, stocks would do better if the SEC were weaker and we'd all be wealthier if seniors weren't guaranteed a minimum income, funded through payroll taxes. But America's economic mastery since 1945 has served as an ongoing and constant refutation of their most dearly held beliefs. It still does today. …

And this pisses them off no end. 

My conservative friend has made this argument to me several times, if less compactly.

Check it out.

He's Still "That Man"

The Bushies' war on Franklin Roosevelt.

Daniel Gross - Friday, Jan. 28, 2005, at 1:59 PM PT – SLATE.COM