Death by Design: The (Bu$h) Plot to Destroy Social Insurance

[Vitruvius]

by Dr. Maya Rockeymoore

Our nation’s political leaders are looting the federal treasury and they expect ordinary citizens not to notice. <SNIP> The Bush administration's version of the ownership society <is to> give away the federal treasury to the “have and have mores” by bestowing tax cuts on wealthy individuals, huge subsidies for wealthy HMO’s, no-bid contracts for wealthy defense firms, and large transfers to wealthy Wall Street money managers hungry for Social Security payroll taxes. An administration that came into office with historic surpluses is striving to leave office with a legacy of having set the stage for bankrupting the nation’s two premier social insurance programs – successfully mismanaging taxpayer’s money and trust in the process. <Thereby setting the stage for total privatization.> <SNIP>

If we examine the Administration’s approach to Social Security privatization in light of its contorted approach to the Medicare bill, <SNIP> a pattern is emerging that may very well signal a more ominous plot to destroy the social insurance nature of Medicare and Social Security. <SNIP> Medicare’s Hospital Insurance (HI) trust fund was already facing a long-term inability to meet its financial obligations due to rising health care costs and reduced tax revenue caused by the recession when Bush's 2003 Medicare legislation was enacted. Instead of generating additional revenue or trimming expenses to place Medicare on a solid financial footing, the Administration and Congress added prohibitively expensive programmatic expenditures in the form of an uncapped drug benefit that enables pharmaceutical companies to charge seniors and the government as much as they like and massive subsidies to prop up HMO’s that have already proven their inability to provide consistent, quality care for seniors. As a result, Bush and Congressional Republicans sped up the date at which the program would be unable to pay full promised benefits by seven years – from 2026 to 2019. <SNIP> Why did conservatives disregard their fiscally conservative political base to add expensive program features that are not sustainable? It is highly probable that they are setting Medicare up for failure and building the case for privatizing all social insurance programs within the next 10-15 years.

We now see a similar pattern in the Social Security debate. Basic facts are the same: the Trustees estimate that Social Security will face a long term funding shortfall in the year 2041. Instead of addressing the shortfall, the Administration proposes to create expensive private retirement accounts that add huge financial burdens to the system that cannot be sustainable in the long term. Like Medicare, the Center for Budget and Policy Priorities estimates that the addition of private retirement accounts, expected to cost 4.9 trillion over two decades, would accelerate the date of Social Security’s insolvency by about eleven years – from 2041 to 2030.

Once social insurance programs have imploded under the weight of their fiscal pressures, the Administration schemes leave an escape hatch for privatization. In the case of Social Security, they will simply transition individuals completely into private retirement accounts – making them solely responsible for shouldering the burden and risk of meeting their retirement needs through private savings and stock market investments. <SNIP> In the case of Medicare, the privatization escape hatch are the Health Savings Accounts and the HMO’s/PPO’s <SNIIP>. Thus setting the stage for the elimination of Medicare.

In either scenario, it doesn’t take a rocket scientist to project the type of arguments that will be made as the looming date of insolvency approaches for both programs and the nation buckles under the weight of the costs. In early March, Federal Reserve Board Chairman Alan Greenspan gave us a glimpse of them when he reportedly warned House Budget Committee members that benefits promised under Social Security and Medicare were unsustainable and would cause severe economic consequences for the economy if not retooled. What did Greenspan identify as his preferred alternative to social insurance? Private individual accounts.

Much, much more at http://www.blackcommentator.com/133/133_cover_rockeymoore_pf.html Note that the author works for the Congressional Black Caucus Foundation and previously worked for the Social Security Subcommittee of the U.S. House of Representatives Committee on Ways and Means.

[orpupilofnature57]

1. If their left unchecked much longer, we'll be back to feudalism in no time

[teryang]

2. Scary! Exactly the wrong policy.

Good post. Thanks for the info. How many white people are going to have employee sponsored medical plans during retirement in 2020? Not that many. Corporate employee retirement plans are also unfunded and facing default risks.

That makes this drowning the baby in the bathtub policy ABOUT THE WORST POLICY YOU COULD UNDERTAKE. This is why they have to have a police state already set up because of the coming social disorder.

[Shallah Kali]

3. I thought this was their plan - wreck it since they can't eliminate it

:mad:

This article certainly is a must read.