Here’s a surprise: Conservative Sam Brownback wants to gut Social Security by forcing young workers to invest their Social Security contributions into the stock market, as well as giving that option to older workers.
As he says: "The funds, instead of going into the government, are going into personal accounts that will be invested in the economy, creating capital and growth and economic activity."
Because as you see, when the government takes your money, it inexplicitly disappears. No growth is created. It doesn’t enter the economy. It isn’t paid in wages or handed out as congressional pork or used to pay off the national debt. It just vanishes and doesn’t get used to create capital, growth, or economic activity. Of course. There must be some gigantic mattress in Wyoming that they stuff it all into, as I can’t imagine where it would go otherwise.
And one reason why Brownback thinks that’s a good idea is because:
"This would reduce the size of the federal government overall.”
And no, Sam. It doesn’t. The only way to reduce the size of the government is to cut government spending. Sure, you can cut revenues, but if you don’t cut spending, then you’ll just keep getting higher deficits…which is exactly what Bush has been doing to us for several years and it totally sucks. And if you can cut spending without cutting revenues, then you could payoff our old debt faster. That’s the way it works in the businessworld, and I see no reason why that wouldn’t work for us.
And how would Sam’s plan make up for the shortfall in revenue from the immediate drop in payroll taxes? “Brownback would raise money to pay for the shortfall by having the Treasury Department issue securities.”
That’s right, he’d increase the deficit. That’s his plan. And then he’d have them stop issuing that debt once the benefits being paid for the old system dropped below payroll tax revenue; which would be many decades from now. Of course, that’s the way things are right now. The benefits being paid are below the amount the government receives. In fact, it runs at a huge surplus that helps reduce our deficit spending. And so Sam’s going to replace that surplus with more deficit spending. Great.
And if we were smart, we’d raise taxes back to the pre-Bush rates, pay off some of our deficits, and then be in a better position to deal with the Social Security crisis, if it happens. But no. Sam’s got the plan to kill it off right now, and to increase our debt to do it; both by killing a revenue stream and issuing more debt. Thanks, but no thanks, Sam.
Oddly, the journalist who wrote that piece suggests that Brownback is doing this because he wants to be seen as a fiscal conservative. I guess that’s just become yet another of those Orwellian words that only means what conservatives want it to mean. And this journalist is clearly ready to play along.
Speaking of that journalist, what do you think of this paragraph in the middle?
A grim future looms for Social Security. As post-World War II baby boomers begin retiring, the system won't collect enough taxes to pay for retirement benefits. Without big changes, the government likely will have to raise taxes or reduce benefits to pay for the system.
No ifs, ands, or buts, in that one. A grim future looms and we need big changes. Unless of course that doesn’t happen. And let’s not forget that debt option. We just issue more debt to pay for the benefits, just like what Sam wants us to do now. But never mind that. Sam’s a fiscal conservative so he clearly knows what he’s doing.
And what of the risks of having poorly educated workers investing in the stock market? The writer quotes the policy director of AARP saying that’s a problem. But never fear. Here’s the last line in the article:
Brownback said that even in the most volatile years, the rate of return on stock investments is positive.
Well I guess that takes care of that. Brownback assures us that we won’t lose money in even the most volatile years, and so that’s good enough for us. I mean sure, I personally have had my 401k plan lose money, and that we really haven’t had a particularly bad depression; like the one that spurred the creation of Social Security in the first place. But whatever. Our money’s safe with Sam. After all, he’s a fiscal conservative, just like Bush. Yeah, Sam! He’s our hero! Ooooh!