Wednesday, April 06, 2005

Bush: Master Economist

I haven't really been paying too much attention to Social Security reform, other than having an initial reaction of "Hmm, subjecting people's retirement money totally to the vagaries of the market, and their ability to invest it themselves, seems like a bad idea". That reaction was reinforced after reading a series run by the LA Times last year about the increasing shift of economic risk from businesses and government to families, and the deleterious effect that has had on many families -- privatizing Social Security seems like another step in that [bad] direction. There's also an article in the Washington Monthly attacking the Republican definition of "freedom", and its lack of honesty about the increased risks associated with the freedom they propose, that has some bearing on this.

In this vein, I heard a story on NPR this morning that just made me howl. President Bush, in an attempt to gain support for his Social Security reform proposal, displayed a cabinet that supposedly contains all the Treasury bonds that back Social Security benefits and said something to the effect of "Look, this is what all the money you've put into Social Security looks like -- it's just Treasury Bonds sitting in a filing cabinet. Shouldn't that be fixed ?" [AP News story, LA Times story]

This is so simple-minded that I don't even know where to begin. It's kind of like saying "Look, wouldn't you feel more comfortable if the government had a big building just filled with piles of cash ? Or if we had a lot of treasure chests filled with gold, diamonds and other precious substances, buried on an island whose location is on a map that only two people in the world have, and which needs to be read under a special kind of light ? Instead, all we have is this newfangled ... paper thing, called a Treasury Bond ... how can you trust that ?"

So, not only does he impugn the guarantees made by the government he's the head of, but following this impeccable line of reasoning, it must make more sense to invest the money in securities that have virtually no guarantees [as opposed to the guarantees made by the US government about Treasury bonds] ... yeah, I get that. Totally. And Chewbacca lives on Endor.

The mind boggles.


Blogger Corey said...

Chewbacca should live on Endor. It's as exciting as riding around 100 level riders at track days. w00t.

6:19 PM  

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