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Daily Howler: Can we 'save SS' without private accounts? The New York Times buries a bombshell
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DON’T ASK, DON’T TELL! Can we “save SS” without private accounts? The New York Times buries a bombshell: // link // print // previous // next //
FRIDAY, FEBRUARY 4, 2005

DON’T ASK, DON’T TELL: Good grief! As everyone knows, the SS trustees project a $3.7 trillion funding shortfall over the next 75 years. And ever since his 2000 run for the White House, George Bush has said that this “crisis” can only be solved by the use of “personal retirement accounts” (and yes, that was the term he used, even during Campaign 2000). But what other changes to the current system might wipe out that funding shortfall? In this morning’s New York Times, Edmund Andrews offers a bombshell:
ANDREWS (2/4/05): Some Republicans have even gone so far as to suggest the one approach Mr. Bush did not mention in his speech, raising the ceiling on income subject to payroll taxes, which is now about $90,000 a year. The idea appeals to some politicians because only about 6 percent of Americans earn more than $90,000 a year. Imposing Social Security taxes on incomes of up to $200,000 would come close to eliminating the entire [$3.7 trillion] deficit.
Good grief! What a bombshell! If Andrews is right, raising the ceiling to 200K would virtually solve the whole problem! And make no mistake: Few Americans have ever heard such a thing. Almost surely, Andrews’ editors placed this news where Times readers could barely miss it!

But if you found yourself thinking such thoughts, you don’t understand modern media. In fact, the quoted passage is paragraph 25 of a 26-paragraph report in this morning’s paper. If Andrews is right, this is major information—news that Americans should understand. But Andrews’ article doesn’t concern possible SS revenues increases; instead, it discusses four different ways the government could tackle that deficit by reducing SS benefits. The bombshell we’ve quoted involves raising taxes, something Bush has put off the table. So it rates footnote status at the end of this piece. Few readers will even see it.

Is Andrews right in what he says? We don’t know, because modern media rarely provide any real information, even about the day’s leading issue. But how could that deficit be addressed without resorting to private accounts? If you’re rational, you’ll see that this is an obvious question—and you might even think that our major papers would have explored it in detail by now. But alas! Our major papers stare into air, failing to provide even basic information about a topic Bush has discussed for five years. How might that deficit be addressed without resort to private accounts? Yes, you’re right, it’s an obvious questions. And our hapless newspapers—inert, lazy, shiftless—stare into air and ignore it.

Indeed: As we’ve noted several times in recent months, if you want information about SS, you have to turn to editorials, not to news reports. Today’s Washington Post gives another example. The Post scolds “Bartleby Democrats” for refusing to offer their own plans for addressing that revenue shortfall. In the process, the editors write this:

WASHINGTON POST EDITORIAL (2/4/05): In fact, there are responsible ways, consistent with Democratic [Party] principles, to "fix" Social Security, but elected Democrats have tended to run from them as if they were leaking vials of anthrax. A plan by Democratic economists Peter Diamond and Peter Orszag features a thoughtfully calibrated combination of tax increases and benefit cuts—meaning that no Democratic politician wants anything to do with it, even though the Diamond-Orszag plan would make the system more progressive and put it on a sustainable footing even beyond the traditional 75-year horizon.
Wow! But how exactly would that plan work? Needless to say, it’s almost impossible to answer that question by reading our leading newspapers. According to Nexis, the Post’s news pages have described this plan just once, in a tiny, unsigned presentation on January 2. The New York Times has given the plan one paragraph, in a report on January 10.

How could Congress address that projected deficit without resort to private accounts? It’s the most obvious question on earth. But today, Andrews’ bombshell rates a passing mention, way down in his penultimate paragraph. How are Americans supposed to judge the wisdom of the Bush proposal? As usual, our big newspapers stare into air, unwilling to present the most basic information. Can you read between the lines? Papers to public discourse: Drop dead.

VISIT OUR INCOMPARABLE ARCHIVES: In their seminal book, The Phony Crisis, Baker and Weisbrot claim that the 75-year shortfall can be eliminated by a modest hike in the payroll tax—a hike “which would still leave future generations with an after-tax wage far higher than that of today’s employees.” To state the obvious, newspapers should be reporting the range of ways in which that shortfall can be addressed. But modern scribes like to stare into air. So you’ll have to see THE DAILY HOWLER, 12/10/04. Scroll down to “IT’S SO EASY.”

LINCOLN RELENTS: How inept are major Dems when it comes to critiquing Bush’s proposal? For a study in sheer incompetence, check Blanche Lambert Lincoln’s performance on last evening’s Hardball. In particular, check the second full exchange between Chris Matthews and the hapless Arkansan. We present the full text below.

How did she fail thee? Let us count the ways:

1) Ineptly, Lincoln presents the gloomy projections of the SS trustees as if they were established fact. (She mentions the rosier CBO projection once, but only in passing.) Hence, given a choice between two projections, Lincoln uses the one which favors Bush, her supposed opponent. And she doesn’t explain why the trustees’ projection is almost surely too pessimistic. Are you surprised that journalists omit this basic info when even big Dems won’t cite it?

2) When she’s asked why Dems booed one part of Bush’s speech, she doesn’t give the obvious answer: Democrats responded as they did because Bush was grossly misleading the public, and because Democrats are tired of seeing that happen. And by the way: Although Matthews accuses Dems of “booing” Bush in an “obnoxious” way, they actually seemed to be saying “no” on the tape he played. But Lincoln doesn’t challenge that either. She simply accepts Matthews’ characterization.

3) When discussing Bush’s most misleading statement—his statement that “the entire system will be exhausted” in 2042—Lincoln finds a way to make it sound like Bush made a semi-accurate statement. (“Now, will the trust fund be exhausted?” she says. “Yes. By 2042, the trust fund, if we don`t do anything right now, will be exhausted.”) Instead of stressing the fact that Bush was misleading the voters again, she almost makes it sound as of he may have simply misspoken.

4) When Matthews defends Bush’s use of the misleading term “bankrupt,” Lincoln simply dodges the issue, offering an irrelevant, incoherent reply.

5) When Matthews asks an obvious question (“Where will the money come from if you don`t have enough money coming from payroll taxes in the year 2042?”), Lincoln has no reply—none. She simply evades this obvious question, and every viewer sees it.

In a word, Lincoln’s performance was pathetic. She refused to tell the American people that Bush and his allies have long misled them about the severity of this problem. And who except a modern Democrat would choose the projection which favors Bush, given two major projections to choose from? But that’s how this hapless gang plays the game; earlier, Kerry and Kennedy did the same thing (see THE DAILY HOWLER, 1/31/05). Indeed, with opponents like Lincoln, Kerry and Kennedy, Bush hardly needs to bother with advocates. More on this remarkable problem next week as we discuss what these Dems are withholding.

“Something we were withholding made us weak,” Frost wrote. Next week, we update his verse.

READ IT AND WEEP: In a word, Lincoln was pathetic. There’s no need for Bush to put advocates on the air if his opponents withhold themselves thus:

MATTHEWS (2/3/05; returning from break): Here`s President Bush speaking last night on Social Security going bankrupt by the year 2042. Let`s listen to the boos.

BUSH (videotape): By the year 2042, the entire system would be exhausted and bankrupt.(Audience reaction) If steps are not taken to avert that outcome, the only solutions would be dramatically higher taxes, massive new borrowing or sudden and severe cuts in Social Security benefits or other government programs.

MATTHEWS: Why the boos from the Democratic side, Senator?

LINCOLN: Well, you get boos all the time. Clinton got his share of them, too.

MATTHEWS: Not like that. That was pretty obnoxious boos, wasn`t it?

LINCOLN: Well, I think you could have seen it today in the hearings we had. We had one on aging today. We one on finance yesterday. And the fact is, is, the system doesn`t go broke. In 2042 or `52, depending on who you`re listening to, recipients will only get 75 cents on the dollar of what they`re putting into it.

MATTHEWS: Right.

LINCOLN: The system is never going to go broke, because you`ve always got payroll taxes going into it.

MATTHEWS: Right.

LINCOLN: Now, will the trust fund be exhausted? Yes. By 2042, the trust fund, if we don`t do anything right now, will be exhausted.

MATTHEWS: Well, where will the money come from if you don`t have enough money coming from payroll in the year 2042? What will keep it from going bankrupt?

LINCOLN: You`ll have enough to pay 75 percent of the benefit in 2042. You just won`t have enough—anything in the trust fund to be able to pay 100 percent of the bills.

MATTHEWS: But “bankrupt” is when a business can`t pay all its bills. It can pay some of them. What`s the difference? It sounds like “bankruptcy” to me if you can`t pay your bills.

LINCOLN: Well, I think there are a lot of people, particularly the young people, when they say that the return on these private accounts isn`t going to come due until 2065—

MATTHEWS: Are you afraid of the president coming into your red state, Arkansas, and saying, “Get rid of this senator because she`s not with the team on Social Security reform?”

LINCOLN: No. I`m just like Richard [Shelby]. I welcome the debate. I welcome—

MATTHEWS: But he`s not coming after him.

(LAUGHTER)

MATTHEWS: The president isn`t going after [Republican senator] Richard Shelby this month. He`s going after the Democrats.