Generational warfare (Bush Soc Sec priv accts screws the young & not rich)

[papau]

http://www.boston.com/news/globe/editorial_opinion/oped/articles/2005/01/14/generational_warfare/

BEN HUBBARD
Generational warfare
By Ben Hubbard | January 14, 2005

IF THERE'S one voice conspicuously absent in the debate over replacing Social Security with private investment accounts, it is young people -- the ones with the most to lose.<snip>
First, the system is not in crisis. The amount of money needed to make Social Security solvent into the next century is less than what we're spending each year fighting in Iraq. That amount is equal to about 20 percent of the revenue lost each year because of the president's tax cuts. In other words, if we repeal some of the tax breaks given to the richest Americans since 2001, we could easily shore up Social Security.

Second, transitioning to private accounts will cost approximately $2 trillion without doing anything to improve Social Security's long-term finances. Since the government is already running a record deficit, that extra money must come from cutting federal spending, raising taxes, or borrowing more. There's little room to cut spending -- unless they cut more programs like college aid. But after four years of slashing taxes, the president isn't likely to raise taxes for any reason. This leaves just one option: more borrowing and more debt for young Americans.

Worse still, Wehner's internal memo makes it clear that privatization won't solve the Social Security problem. In addition to trillions in transition costs, the president's plan will include drastic cuts in benefits for future retirees -- today's young people. Without these cuts, he writes, "we'll face serious economic risks."

Third, with no changes to the current system, workers can expect higher benefits from Social Security than from a system of private investment accounts, according to a study by the nonpartisan Congressional Budget Office. That means today's twenty-somethings will be better off when they retire even if nothing is done to "fix" Social Security.<snip>

Ben Hubbard is campus programs director at the Center for American Progress.