Dean Baker: The Meltdown Lowdown

[marmar]

from The American Prospect:



The Meltdown Lowdown

This week in economic news: McCain supports privatizing social security, The Washington Post is in denial about the housing bubble, and Wall Street jobs are now being outsourced.

Dean Baker | August 14, 2008 | web only



It's Social Security Day, Is Your Retirement Safe?

Today marks the 73rd anniversary of Franklin Roosevelt’s signing of the bill that created Social Security. It might be a good time to pull the presidential debate away from issues like Barack Obama’s celebrity status and whether or not his name is too foreign-sounding to be president.

Obama and McCain have very different views of Social Security. Obama has repeatedly committed himself to keeping the current structure in tack and said that, insofar as the program faces a long-term funding shortfall, he would look to increase taxes on people earning over $250,000 to fill the gap.

Since the nonpartisan Congressional Budget Office projects that the program will be able to pay full benefits until 2046 (and more than 75 percent of projected benefits long after this date), there certainly is no need for hasty actions to shore up Social Security. After all, the date when it first is projected to face a shortfall is almost three full decades after the last possible date when the next president will leave office. (I will not comment on how old Sen. McCain will be 2046.)

Sen. McCain has been a longtime supporter of Social Security privatization and supported President Bush’s effort to privatize Social Security in 2005. Such a plan would almost certainly both cut benefits for future retirees and make the benefits they receive less secure, since they will depend on the fluctuations in the stock market.

Social Security provides more than half of the retirement income for two-thirds of the elderly. It is likely to be even more important in the years ahead, due to the collapse of the defined benefit-pension system and the massive loss of wealth for older workers due to the collapse of the housing bubble. It would be nice if the media cared that one candidate wants to undermine it. .....(more)

The complete piece is at: http://www.prospect.org/cs/articles?article=the_meltdown_lowdown_081408

[Mojorabbit]

1. Great article! n/t

[provis99]

2. Dean Baker is one of the few economists I have respect for

Most of the rest of them are contemptible right-wing shills for a free enterprise system that doesn't exist in the real world.