Nick Kristof has a column today in the Times in which he argues that Democrats are wrong to flatly oppose President Bush on Social Security privatization, both substantively and perhaps also politically.
Democrats themselves, he argues, were serious in pressing the issue of reform in the 1990s. And they were right then and wrong now because even if the president has exaggerated the problems facing Social Security, it does face very real problems. Democrats may object that "Mr. Bush will use his reform as another occasion to soak the poor," as he puts it. But if that is the case, then that is only another reason for them to constructively engage the president rather than flatly oppose him. The heart of the column is contained in the passage in which he says that there is but "one powerful objection to private Social Security accounts." And that is that under present fiscal circumstances we cannot or may not be able to afford them.
Reading Kristof's column I can't come to any other conclusion but that Kristof doesn't grasp either the policy proposals up for discussion or the social purposes for which Social Security exists and that for him both are clouded by rhetoric meant to obscure the issues at stake.
Kristof's column, actually, provides an opportunity to review and expand upon the essentials of this debate. So let's have at it.
President Clinton tried to devote the final two years of his presidency to "saving" Social Security from the threat of future insolvency -- a threat which appeared substantially closer then than it does today, less than a decade later. His plan was to shore up the nation's fiscal standing so that it would be better able to cope with the pressures created on Social Security by the baby-boom generation in the early and middle decades of this present century. (For more on this point, see this earlier post on Social Security and the question of aggregate national indebtedness.)
Let's stop and understand what that means. He wanted to take steps now so that Social Security could continue to exist for future generations as a defined benefit social insurance and old age pension system. President Bush, on the other hand, is trying to phase that system out and replace it with a defined contribution system of 401k-style private accounts.
These are not two spins upon or flavors of putting Social Security on a solid footing. The difference is a category difference, as clear as it ever is between preserving something and trying to bring it to an end. The difference is fundamental. And anybody who does not understand this either doesn't grasp the policies involved, has been fooled, or is at work trying to fool someone else.
Let's grab this by the root.
Is it fair to say that President Bush is trying to "phase out" Social Security? Well, what is Social Security? For seventy years it has existed as a defined benefit social insurance program. What does that mean? It is a social program in which everyone who works during their lifetime gets a guaranteed benefit in retirement. It's not meant to be a sole means of support. Those who pay in more get more back; and those who pay in less a bit less. But everyone who works is guaranteed a benefit which provides at least a modicum of comfort and dignity in old age. Have the benefit structures changed over time? Yes. But they change for everyone together, not by the vagaries of chance or individual fortune.
Social Security envisions a retirement in which recipients, hopefully, have three sources of income: Social Security, some employer-based pension and personal savings. The latter two, in varying degrees depend on how hard you work, how much you make, how wisely you invest and the vagaries of chance. Social Security, as a defined benefit program, is meant to be the one leg of the stool which is a flat guarantee.
At root, with all the statistics and flimflam over words, President Bush wants to change that. He wants to phase out Social Security in favor of private investment accounts. In the latter case, there is no guarantee at all, just as there is no guarantee in private nesting, which of course is just as is should be. He wants to get rid of the defined benefit program and change it to a defined contribution program -- not partially, but totally. Indeed, he said this in his recent press conference quite clearly. But few of the reporters present latched on to the statement or its significance. Social Security, he said, is "now in a precarious position. And the question is whether or not our society has got the will necessary to adjust from a defined benefit plan to a defined contribution plan. And I believe the will will be there. (emphasis added)."
There's no 'partial' here. He's talking about phasing out one and replacing it with the other. Reporters and commentators don't seem to get that this is a category difference, though this is something that is widely understood in the pension policy community.
Let's look at the words they use.
Take this article from the trade publication Business Insurance from August 30th of last year. The headline reads: "More employers freezing, phasing out DB [i.e., defined benefit] pensions; Companies closing defined benefit plans may experience unwanted side effects." And the lede reads: "Faced with increasing pension funding liabilities and an unfriendly regulatory environment, more employers are phasing out their traditional defined benefit plans and opting to beef up their defined contribution offerings." Or take an example from the mass circulation dailies in which the same issue is discussed. This from the Miami Herald back on January 22nd, 1995: "If you work for a big corporation, you may still qualify for a defined benefit plan. But don't count on it. Many employers that offer both defined benefit plans and 401(k)s are phasing out their pension plans and beefing up their 401(k)s."
As those who follow these matters well know, going from a defined benefit plan to a defined contribution plan is seldom a good thing for recipients. Under the president's plan benefits would be far lower and they would not be guaranteed in any way. Whether you think this is a good thing or not, the change is a fundamental one.
A number of wavering Republicans are now saying that they will only sign on to the president's plan if it still maintains the guaranteed benefit. But that's silly. Not only is it obvious that his plan doesn't do that; as we've noted above, he's already said himself that it doesn't do that.
It's easy to get lost in verbiage about defined this and defined that and mazes of actuarial figures. The key, though, is the difference between an unsecured system and a secured one. That's why it's called Social Security and why phase-out is really the only candid way to describe what the president wants.
Privatizers have tried to confuse this issue in a number of ways -- most recently by referencing President Clinton's willingness to consider investing a portion of the Social Security Trust Fund in private securities rather than in Treasury bonds. In his 1999 State of the Union address Clinton said "I propose that we commit 60 percent of the budget surplus for the next 15 years to Social Security, investing a small portion in the private sector just as any private or state government pension would do. This will earn a higher return and keep Social Security sound for 55 years."
Whether investing a part of the Trust Fund in private securities is a good idea or not is a complicated question. In retrospect, at least in the short run, doing so in 1999 would have been a very bad idea since, as we now know, the stock market was at the height of an historic bubble. Tricksters like Brit Hume on Fox and various easily-bamboozled hosts on CNN are now saying that what Clinton was proposing is what Bush is proposing today. But anyone who says this is either being dishonest or is simply ignorant.
What Clinton was proposing was simply a different way for the Trust Fund to invest its money -- perhaps a good one or a bad one. But it would still be a defined benefit program. The risk of investing would be borne by the government, not the individual. Making a higher rate of return would make it easier for the Social Security program to pay guaranteed benefits down the road. But for the individual the benefits would remain the same regardless. As Clinton noted, many state defined benefit plans invest their money in this way. Under the Bush plan, it's different. Individuals invest their own small sums in the market and they're on their own. No guarantee.
So, to sum up this lengthy discussion. Our current retirement system envisions people going into retirement with three sources of income: the guaranteed benefit from Social Security, private savings and hopefully, though less and less frequently, an employer-based pension. Democrats have no beef with private investing, though privatizes try to imply otherwise. They want families to save more for retirement than they are today. The issue is no more complicated than a simple one of diversification -- the need for Social Security and private savings, both of which complement each other. (Later we'll discuss why the decline of employer-based pensions is an argument for the add-on accounts favored by Democrats.)
Anyone who looks honestly at the numbers realizes that under private accounts the average beneficiary would almost certainly get less money in retirement than they will now under the current Social Security system. But the key is that the president wants to phase out the defined benefit Social Security system and replace it with 401ks, the defined-contribution approach. Or, in other words, to get rid of Social Security and have people make up the shortfall with private savings.
Kristof says that the only "powerful objection" to phase-out is that at the moment we can't easily handle the transition costs. So it would seem that the entire issue of defined benefit versus defined contribution plans, Social Security versus 401ks, is lost on him.
Another problem is Kristoff's claim that there are a "variety of ways to organize retirement accounts so the poor are better off."
Social Security is not welfare. The issue is not principally one of "the poor." For coming up on a century, Social Security has been the sheet-anchor of the American middle class. It is about preventing people who have been middle class during their working lives from becoming poor when they retire. (In a later post we'll discuss how Social Security honors the value of work.) In so doing the guaranteed benefit of Social Security ramifies through the economy and through the generations in ways that the current debate has scarcely begun to explore.
For instance, Social Security has been instrumental in preventing parents from the necessity of deciding whether to support aging parents or spend on education for their children -- a devil's choice which was always a key route by which families were yanked out of the middle class, since investment in education has long been key to preserving middle class status.
In any case, we can go into more detail on all these points. And I haven't even touched on the survivors' and disability insurance portions of Social Security, which the 401k model wholly ignores. But let me return to my central point.
Getting rid of Social Security and preserving it are not two versions of the same endeavor, even if the distinction is intentionally obscured by the rhetoric of 'reform.' They are opposite objectives. Since President Bush is now trying to do the former nothing is more obvious or logical than that the Democrats are opposing him root and branch since they want to do the latter.
This is all another way of saying that the Democrats do have an alternative on the table: preserving Social Security rather than phasing it out. (Once again, let me say that in a later post I'll discuss why our values are only honored by a system like Social Security.) Democrats already have and will continue to propose adjustments to the system to handle potential shortfalls which are decades in the future. But this debate -- for anyone who understands it, indeed even the White House now concedes the point -- is not about solvency. And the fact that Kristoff does not grasp that point is not their problem, though his confusing the two issues certainly complicates preserving the program.
--Josh Marshall
Uh-oh ... According to the Fargo Forum, claims that the Fargo Social Security event blacklist was the work of an over-zealous local volunteer may not hold up.
"[C]lues uncovered Friday, says the Forum, "indicate a worker with the White House advance team may have been the culprit.
--Josh Marshall
Palm Beach Post, Feb. 5, 2005
Onstage with Bush during his hourlong town hall meeting were five Tampa Bay-area residents ranging from 20-something to retiree. They included 27-year old Jim Browne of St. Petersburg, who said, "Many of my generation do not anticipate Social Security being there."To which Bush answered, "When I was 27 years old, I don't remember anybody talking about whether the system is going to be there."
USAToday, July 28, <$NoAd$> 2000
Bush [then 32] won the primary and, in the general election against Democratic state Sen. Kent Hance, ran on some of the same ideas he promotes today. He supported the 33 1/3% tax cut proposed by Jack Kemp and William Roth. He predicted Social Security would go broke in 10 years and said the system should give people "the chance to invest money the way they feel" is best.
AEI Public Opinion Study, February 3, 2005
Confidence in the future of the Social Security system has been lacking for a long time. A question asked in 1981 shows that only 31 percent had a great deal or a fair amount of confidence that the Social Security system would have enough money to pay benefits after the year 2000! Still, Americans do not see the Social Security system in crisis. They believe it has serious problems.
--Josh Marshall
Sen. Grassley (R) of Iowa says the president has a 90 day window to sell the public on Social Security phase-out.
--Josh Marshall
Egg shells.
From Gannett...
Even Sen. Mike DeWine, R-Ohio, one of the president's strongest supporters, backed away from a Wednesday statement in which he said, "I agree with the president's plan to encourage personal savings."On Thursday, DeWine modified the statement to say, "I agree that we must do something to encourage personal savings." But he said he had not "determined whether ... private savings accounts should be a part of strengthening Social Security for our children and grandchildren."
The Cincinnati Post elaborates ...
Sen. Mike DeWine, a GOP moderate, sometimes supports the president's policies and sometimes doesn't. His office had a tough time explaining whether or not he stands with the president this time.Right after the president's State of the Union address Wednesday night, DeWine's office put out a statement saying the senator believed that the speech opened an important dialogue on protecting Social Security.
"I agree with the president's plan to encourage personal savings,'' the statement quoted the senator as saying.
Sounds like an endorsement of Bush's proposal to let younger workers invest a portion of their Social Security taxes in personal retirement accounts. Right? Not exactly.
The next day, DeWine's office issued another statement clarifying the senator's remarks. Instead of saying he agreed with the president's plan, what the first statement should have said, according to the follow-up release, was simply, "I agree that we must do something to encourage personal savings.''
"Sen. DeWine has not determined whether or not private savings accounts should be part of strengthening Social Security for our children and grandchildren,'' the second statement said. "He does, however, strongly believe that we must look for ways to encourage more personal savings so that when people retire, that in addition to enjoying the benefits of Social Security, they will have other sources of income.''
The Cedarville Republican remains open "to all ideas'' and believes that "the ideas that the president has, other Republicans have, and Democrats have should be fully explained, discussed and debated, and that we should forge a bipartisan compromise,'' the follow-up release said.
"He also believes that is most important that we listen to the people, on what they think should be done to ensure that Social Security remains strong."
The rapid growth of GOP queasiness about Social Security phase-out has strained the acceptance <$Ad$> mechanisms for the Conscience Caucus. Clearly DeWine is now a member of the Caucus since, as the founding rules state, he does "appear open to" opposing the president's plan.
FIW status (Finger In The Wind) is reserved for those members who more or less openly state that they are willing to begin phasing out Social Security so long as the president can make it safe for them to do so. This status was first created for Sen. Gordon Smith (R) of Oregon.
Now, here at TPM we're not so naive as not to understand that the great majority of Conscience Caucus members are Finger In The Winders in their heart of hearts. But, remember, the FIW status is reserved for that select group who more or less openly concede their intention to make a vote devoid of principle and indifferent to policy, like Smith.
As you can see, though, Sen. DeWine doesn't qualify since he is one of that legion of Republicans who just think the world of George W. for taking the initiative on such a complex issue but somehow, well ... just at the end of the day, gosh darnit, they just can't seem to get their head around the subject, can't decide whether replacing Social Security with private accounts is a good thing or not.
So even though we hear the initials may already be taken for something else, we've come up with a new category for these folks. Sen. DeWine is our first member of the Caucus to come in with CFO status, Can't Figure it Out.
[ed.note: An earlier version of this post incorrectly referred to Sen. Mel Martinez as possibly entering the Conscience Caucus with FIW status.]
--Josh Marshall
The Projo reports on the new Club for Growth ads running against Sen. Lincoln Chafee (R) in Rhode Island.
--Josh Marshall
The Prez will only chat up stock brokers on stage in Tampa?
A White House spokesman tells the Tampa Tribune that the president will be joined on stage by a handful of individuals "who have a vested interest in strengthening Social Security and have an important story to tell."
[ed.note: emphasis added.]
--Josh Marshall
Pat Toomey declares war on the Conscience Caucus!
With echoes of Milton and Paradise Lost, former Congressman and now Club for Growth President Pat Twomey has ordered television ad buys against Conscience Caucus members Sen. Lincoln Chafee, restored Caucus member Rep. Sherry Boehlert and Rep. Joe Schwarz, who we didn't even know until today was a Caucus man.
(We hadn't even had time to add Schwarz's name to the list before Twomey struck.)
Stay with these three worthies as they enter their time of troubles!
Chafee is already in CUP? status in the Caucus. He could give up the ghost entirely.
--Josh Marshall
Sen. Olympia Snowe (R) Maine risking her Loud and Proud status in the Conscience Caucus?
Last week Snowe told the Washington Post that she was "certainly not going to support diverting $2 trillion from Social Security into creating personal savings accounts" and told the president that "she would be concerned about doing anything that would undermine the guaranteed benefit of Social Security."
But today, according to RawStory.com, Snowe's press secretary Preston Hartman says: “I wouldn’t say it’s fair to say that she’s against the president’s plan.”
“She’s cautious," says Hartman, "and she wants to examine all the options out there.”
--Josh Marshall
Even the Libertarians aren't buying the Social Security Speech Code!
[ed.note: Ideological exactitude requires me to note that while one would expect Libertarians to be, on principle, in favor of a private-accounts-based phase-out of Social Security, they are the last folks you would expect to have any truck with a White House-dictated Social Security speech code. And in this regard, the good folks at Reason magazine's Hit and Run Blog, which we've linked above, have acquitted themselves quite nicely.]
--Josh Marshall
Ohhh ... and W falls back 5 yards.
From CNN/Money: "Bill Gross, manager of the world's largest bond fund, is criticizing President Bush's plan to privatize part of Social Security. Gross, managing director at Pimco, called the argument about the solvency of Social Security "silly" and said it was an example of the president not focusing on more important issues, such as the budget deficit."
--Josh Marshall
Montana's Great Falls Tribune says Bamboozlepalooza didn't convince the state's lawmakers.
But Caucus member Rep. Denny Rehberg did praise the president's "Oprah Winfrey-style" approach to working the room ...
Rehberg said he felt the president did very well in the "Oprah Winfry-style" panel discussion."It led to a free flow of information, and the president looked very comfortable listening to questions and explaining the future problems of Social Security," Rehberg said.
"It's a sign of the president's leadership that he doesn't want to coast in his second term, but to work to resolve an issue like Social Security that is emotional and controversial.
"He's asking the people of America to listen to different ideas for preserving and protecting Social Security, and he's open to nearly all ideas."
Rehberg did not commit himself yet to supporting the president's idea of personal Social Security investment accounts.
"I want to see all the proposals," he said. "But why not consider such personal accounts that would earn a higher return for young adults that they would own and could pass on to their kids?"
He even called them 'personal accounts'. <$NoAd$>There may be some hope for the president with Rep. Rehberg yet ...
--Josh Marshall
Ginny throws down the gauntlet!
In this news segment running on Florida's WUSF 89.7 News, Rep. Ginny Brown-Waite (R) says she thinks President Bush is coming to Tampa to muscle her and other Conscience Caucus members into signing on to his privatization bill.
But "absent specifics," says Brown-Waite, "I'm not drinkin' that Kool-aid. I am not gonna go down that road."
(See the quotes in question at timestamp 1:05.)
The Ginny vs. Prez showdown is tonight at the Tampa Convention Center.
--Josh Marshall
Sen. Debbie Stabenow (D) of Michigan sets up special anti-phase-out section of her senate website.
--Josh Marshall
Rep. Sherry Boehlert (R) of New York <$NoAd$> demands readmission to the Conscience Caucus!
This morning we received the following note from the congressman ...
Enjoyed your clever and off-times amusing comments. But shame on you for taking anyone to task for talking about our "responsibility to debate all proposals from top to bottom."My commitment is not to a specific course of action at this juncture other than to acknowledge a future problem and a determination to get going toward the development of a solution. Don't count me out yet!
We're always happy to take our dollop of shame if it means welcoming a representative or senator back into the Conscience Caucus.
We've duly updated the membership list.
--Josh Marshall
From the Butte Montana Standard: "Burns said he's going to 'continue to look at it,' but had questions about how to pay the plan's estimated $2 trillion price tag."
--Josh Marshall
Hmmm. Gov. Mike Huckabee of Arkansas doesn't think "anyone pretends [the president's Social Security plan] solves the long term issue of solvency."
Has he been to DC recently? Seems there's a lot of pretending.
Says the Gov.: "It’s trying to address methods to improve the system and broaden the base of how it is funded."
--Josh Marshall
Coming later, Senator John Warner (R) of Virginia and his letter to the GAO on Social Security and privatization.
--Josh Marshall
If you're in Little Rock or Tampa, you're up. Today's your day. The Bamboozlebooza Tour is coming to town. If you're going to be on hand for the festivities do let us know and let us know what you hear and see. If you've got a blog, even better. There may even be a "Privatize This" T-Shirt in it for you.
Even better, are you on the black-list for today's events in either town? If so and you can prove it, there's a definite shirt in it for you. At the moment, the White House is claiming that the Fargo black-list was the work of an "overzealous volunteer" whose identity they and the local Republican party claim they are nevertheless unable to discover.
We wondered last night whether Rep. Denny Rehberg (R) of Montana had really gotten through all the festivities yesterday without making any mention of his position on the president's phase-out plan. Well, we hear this morning from listeners on the scene that Rehberg made some equivocal comments on the radio. And this passage from today's Missoulian seems to be the closest he got in print ...
Fellow Republicans U.S. Sen. Conrad Burns and Rep. Denny Rehberg, both of Montana, said after the speech they haven't made up their minds on Bush's ideas. Rehberg said the country needs to openly discuss the issue and not kill the opportunity to fix Social Security with partisan bickering."The president is trying to create a consensus opportunity," Rehberg said.
Clearly, Rehberg now gets slotted into FIW status in the Caucus. But if I'm not mistaken Bush didn't even get the two Republicans in Montana to sign on to his plan. If you see instances of the national press picking up on this fact rather than going on about Baucus, can you drop us a line about that too?
This isn't about Democrats: The President Is Hunting for Republicans Who Will Go On The Record In Support of His Plan.
Now on to Arkansas and Florida.
As we said we're keen to get reports from the ground in both states. As we told you here at TPM earlier and in more detail in my column this week in The Hill, Tampa is a hotbed of membership in the Conscience Caucus. You've got our favorite Rep. Ginny Brown-Waite to the north, Caucus member Rep. Bill Young right next door, Caucus member Rep. Katherine Harris to the South. And aside from them you've got folks like Rep. Bilirakis (R) who don't even seem willing to discuss the issue with the press and Rep. Adam Putnam (R) who looks likely to shift whichever way the wind blows.
These Floridians all to one degree or another have their fingers in the wind. And if you can't say much else for them they're good weather vanes, especially Rep. Brown-Waite. So if you hear them chatting on the radio or get quoted in the papers or if they get up on stage with the president to testify to their phase-out conversion experience, do let us know.
So basically the president is finding hardly any Republicans in any of these states who are willing to go on the record in support of his plan. This is why I would never make it in the news business. I woulda thought that'd be a big story.
--Josh Marshall
Does Donald Luskin have a problem?
No, this isn't a trick question. C'mon, play along.
On January 31st, Luskin wrote that the "president is seeking to reform Social Security with personal accounts — which, by the way, is the same reform being argued for by Harold Ford, the African American Democratic congressman from Tennessee."
Today, no less a worthy than Rush Limbaugh (R-Elysium) flogged the Harold Ford angle too, perhaps picking it up from Luskin.
Admittedly, Ford was once the Dean of the Fainthearted Faction.
But as far back as December 30th, he announced: "I do not support changing the Social Security system as has been proposed by President Bush, nor do I support Social Security proposals advanced by the CATO Institute. In fact, both of these proposals have the potential to harm current beneficiaries by paying for the transition costs by issuing debt. Piling on more red ink to the existing federal budget deficit and the national debt will do both long and short term harm to our economy. I do believe that the system needs to be reformed but I do not support changing the Social Security system as President Bush has proposed."
Then late last month he went even further to clear up any confusion. According to the Memphis Flyer, in their interview with the congressman, he "den[ied] that he does now, or ever did, advocate tapping payroll taxes to create the accounts."
There's even this passage from the article in question ...
And the congressman was quite explicit this week about disavowing not only President Bush's Social Security reform proposals but the concept underlying it. "I have not signed on to any legislation, since I have been in Congress to take money from Social Security to create private accounts. I do not favor privatizing Social Security. I am opposed to President Bush's attempt to do so. Categorically," he said.
As TPM readers are well aware, those are the words that finally got Ford ejected from the Fainthearted Faction altogether.
So it seems, contrary to Mr. Luskin, that Ford really doesn't support President Bush's plan.
Now, I am by no means trying to insert myself into some Luskin-Ford smackdown. But there does seem to be a problem.
--Josh Marshall
Perhaps Democrats should give some serious thought to amplifying this statement from Chairman of the Ways and Means Subcommittee on Social Security, Rep. James McCrery (R) of Louisiana.
From the AP ...
"The AARP and the Democrats think if you divert some money from the trust fund," the existing program will be undermined, McCrery said. "That is true on its face. It does decrease the level of the trust fund. Politically, that's going to be a very strong tool that (opponents) can use to defeat a plan."
That's quite <$Ad$> a thing for someone in his position to say. The Republican with the Social Security portfolio in the House says that diverting money out of Social Security into private accounts weakens Social Security.
Just yesterday, according to the Los Angeles Times, a Bush aide conceded that implementing "individual accounts would do nothing to solve the system's long-term financial problems." But McCrery goes further, affirming the whole truth, which is that they will not only not improve Social Security's longtime solvency they will greatly undermine it.
If that's true, why would anybody be for them?
Did I mention Democrats should mention this?
--Josh Marshall
Did I miss something or did Conscience Caucus member Rep. Denny Rehberg (R) of Montana stay mum while squiring President Bush around Montana? Last we checked in with the congressman's office, his spokesman Brad Keena told us the congressman was "open-minded" about privatization.
I see here where Sen. Conrad Burns (R), who I guess isn't exactly what you'd call a centrist, said he was "intrigued" by Bush's privatization plan. "Social Security is still a very, very important part of the retirement of a lot of seniors in Montana," he went on to say. "So we'll listen and we'll look and we'll probe ... and see what is in it for the next generation."
Frankly, it hadn't even occurred to me that President Bush couldn't count on Burns as a phase-out man. But what about Rehberg? I can't see where he was quoted anywhere today in any paper even though he spent a good part of the day traveling at the center of the national news bubble and he's one of three members of the Montana congressional delegation. Maybe I'm missing some comment to a local radio or TV station. And if there was, I'd be much obliged if you'd let me know. But as near as I can tell, Rehberg didn't answer any questions about the president's plan at all. And I figure there would have been some press interest had he been inclined to do so.
Everyone's reporting, rightly, that Sen. Baucus (D) made clear he's not going to support President Bush on phasing out Social Security. But isn't the story here that President Bush just won this state with 59% of the vote in November. He went to campaign in the state to support his new Social Security privatization plan. And he couldn't get any members of the state's congressional delegation to endorse his plan -- and two of them are from his own party.
Oddly enough, in its reporting, CNN makes no mention of this -- another example of the dire need for a blog devoted entirely to documenting the decline and Foxification of this once proud network.
--Josh Marshall
Mayor Mike Bloomberg (R - well sorta) of New York becomes first Associate Member of the Conscience Caucus.
From the Times ...
Mayor Michael R. Bloomberg distanced himself from President Bush yesterday on the president's proposal to divert some Social Security taxes into private investment accounts, describing the plan, which was the central theme of Mr. Bush's State of the Union address, as excessively risky."I've never thought that privatizing Social Security made a lot of sense," said Mr. Bloomberg, who, like Mr. Bush, is a Republican. "I think what you'd see is that people would invest - some people would invest - unwisely."
He added, "These are not monies that people should be speculating with."
Someone needs <$NoAd$> to get Larry Kudlow to explain markets to this bozo.
--Josh Marshall
Rep. Ginny Brown-Waite (R) Floridia billows in the wind. Says she: "There are a lot of unanswered questions and until I have the answers to them, I am still in the 'withholding judgment' category."
We've put her in the Conscience Caucus with FIW status.
--Josh Marshall
Sen. Patty Murray (D) of Washington moves from "concerns" over phasing out Social Security to opposing it.
--Josh Marshall
A simple question that should be asked of Scott McClellan tomorrow and the president whenever the next opportunity arises ...
The Social Security Trust Fund now has accumulated roughly $1.8 trillion worth of US Treasury bonds. That total debt of the United States government is, if memory serves, just over $7 trillion. US Treasury bonds are owned by Americans, foreigners, individuals, pension funds, everybody under the sun. Most of the president's personal wealth appears to be tied up in them. They're universally considered to be the safest investment in the world. George W. Bush is the President of the United States. So the question is to him. Are the Treasury notes in the Social Security Trust Fund backed by the full faith and credit of the United States every bit as much as the bonds everyone else owns?
Everything the president is saying implies that they are not, that there is a very big question about whether those notes can or will ever be redeemed. So if they're not, the president should say so now.
--Josh Marshall
Wouldn't it be something if the battle for Social Security was won on the Hill and on the hustings but lost in the newsrooms?
It could be happen. Actually, it might be happening right now.
I've got a list here of Republicans who went into the Conscience Caucus today. And with any luck I'll be able to post on most of them tonight. For a sampling, take a look at this AP article. But right now the White House and its Hill allies can see they're losing this debate because the essential fraudulence of their arguments are being exposed.
President Bush's top aides are getting cornered into admitting that private accounts won't do anything to improve the solvency of Social Security. Actually, it pushes it toward insolvency. But candor comes in small packages from these folks. So I guess be grateful. The claim that there was any 'crisis' tanked so quickly even the White House isn't making that argument anymore. And as the Post notes, most of the money you make in your private account goes back to the government. The White House is now furiously denying it. But we've got the transcript of the "senior administration official" saying just that to reporters.
Across the board, the debate is going badly because the whole plan is being revealed for what it is: not an effort to shore up or preserve Social Security but an attempt to phase the program out. You can even see various news outlets over the last 72 hours swaying back to 'private accounts' and 'privatization' in their discussions of President Bush's plan.
And for all these reasons the RNC and the White House are launching a furious assault against the major national news outlets trying to muscle them into shifting the tone and the assumptions of their coverage. The cable networks (at least the ones not already taking orders directly), the broadcast network news divisions, the major national dailies.
Part of it is the language, the speech code, but equally important is the basic issue of when the program will face actual difficulties. If the Bush plan calls for 40% benefit cuts those are cuts. But if the current benefit levels will in fact never be paid, then cuts aren't really cuts, right?
Look through the various transcripts of background briefings posted here and elsewhere to see examples of this.
Let's try an example. Let's say a hypothetical Bush plan cuts benefits by 40%. But what if the White House says that as things are going now recipients in a few decades will only get 50% of their benefits. Well then the Bush plan isn't really a 40% cut; it's more like a 10 percentage point increase in benefits. Or maybe there is no Trust Fund. The whole basis of the 1983 reform just doesn't exist. And the $1.8 trillion just doesn't need to be paid back.
You can see where this sort of stuff goes. And it's what's going on right now.
The issue isn't bias. It's just that the media is far more playable than it should be. And the Republicans just play them harder, more systematically, better.
Who's pushing back on the pro-Social Security side? Who's knocking down the new round of flimflam? Might be good if someone did.
--Josh Marshall
Ring the bell!
The first member of the Conscience Caucus bites the dust.
It was only two short weeks ago that Rep. Sherry Boehlert, master of moderation from Upstate New York, was not only in the Caucus. He was on the brink of being Loud and Proud. He told his constituents: "I’ve never been a gambler … I don’t want to gamble with Social Security trust fund moneys. And so I am very, very skeptical of the so-called plans to privatize. And I think a disservice is being done to a great many Americans by sort of sounding the alarm that everything’s going to hell in a hand basket and we’re going to be broke by 2018. That simply is not so."
But look what a change has now been wrought.
Just moments after President Bush got done with his phase-out peroration, he posted this statement on his congressional website: "[President Bush's] message to Congress was clear – we must strengthen Social Security for all Americans – and I couldn’t agree more. As legislators it is our responsibility to debate all proposals from top to bottom. Americans have a right to a safe and secure retirement, and we will protect benefits for retirees and future retirees. It would be a major injustice to all Americans if we don’t act now - the worst thing we can do is nothing at all. Americans deserve the peace of mind of knowing they will receive full benefits for their retirement."
Oh My!
We're still poking around to see what prompted Sherry's change of heart. We just hope it wasn't W's helicopter love. However that may be, it looks like Sherry's a phase-out man after all, or at least for the moment. So he's outta the Conscience Caucus.
But as we'll discuss in posts later this evening, it turns out there's plenty more where he came from.
--Josh Marshall
Uh-oh ... Looks like Rep. Jim McCrey (R) of Louisiana, chairman of the House Ways and Means Social Security subcommittee, may be looking over the paperwork to join the Conscience Caucus. The AP says McCrery is now outlining "ideas similar to those supported by many Democrats and said he wants to discuss them with the Bush administration."
I guess that counts as a problem, right?
Maybe the president needs to put in a stop down in Lousiana too.
--Josh Marshall
Watch Sen. Baucus's own Social Security event back in Montana running live right now.
--Josh Marshall
TPM reader RT did the <$NoAd$>leg work so I'll let him speak for himself ...
From today's LA Times top story, referenced in the Note, an anonymous white house source said:"White House officials say they are confident that congressional skepticism will dissipate once the president persuades a majority of the public that action is needed to extend the life of the retirement program, a process Bush was scheduled to begin today by taking his Social Security message on the road."a couple paragraphs later:"In a significant shift in his rationale for the accounts, Bush dropped his claim that they would help solve Social Security's fiscal problems — a link he sometimes made during last year's presidential campaign. Instead, he said the individual accounts were desirable because they would be "a better deal," providing workers what he said would be a higher rate of return and "greater security in retirement."A Bush aide, briefing reporters on the condition of anonymity, was more explicit, saying that the individual accounts would do nothing to solve the system's long-term financial problems."
So, the Bushies claim, "there is a huge crisis and our 'solution' will 'do nothing to solve' it."
If this is the same White House source that briefed every other reporter yesterday it is Dan Bartlett.RT
A bit further down in the piece there's this gem ...
That candid analysis, although widely shared by economists, distressed some Republicans."Oh, my God," one GOP political strategist said when he learned of the shift in rhetoric. "The White House has made a lot of Republicans walk the plank on this. Now it sounds as if they are sawing off the board."
Jeeves! Bring me my saw ...
--Josh Marshall
The RNC's Ken Mehlman launches new website, preservingsocialsecurity.com, to flak Social Security phase-out. Take a look, document the lies, win a TPM 'Privatize This' T-Shirt.
--Josh Marshall
Fargo City Commissioner Linda Coates breaks the blacklist and enters the Bamboozlepalooza event as GOP roadies relent at the last minute!
Our favorite local Dakota blog brings you the latest and another phone interview with Coates herself ...
--Josh Marshall
Right out of the box Rep. John Boehner (R), Chairman of House Education and the Workforce Committee, said he was willing and ready to investigate the Armstrong Williams payola affair. Now, it seems, he's decided he'd rather not investigate after all.
--Josh Marshall
More details revealed about the Fargo Forty!
Actually, one detail is that there are apparently 42 of them. But that sort of breaks my rhetorical stride so let's not dwell on that. More interesting is what unites these would-be evildoers who are banned from attending the president's Bamboozlepalooza event today in Fargo.
According to the Fargo Forum: "At least 33 of the 42 people on the list are or have been members of the Fargo-Moorhead Democracy for America Meetup Group." As the Forum describes this cell, "The group is a local progressive organization dedicated to electing fiscally responsible, socially progressive candidates in the Fargo/Moorhead area."
No word yet on whether City Commissioner Linda Coates is also a member, public or otherwise, of said "Meetup" organization.
--Josh Marshall
Fargo Forty Update!
This blog reports that Fargo City Commissioner Linda Coates is currently in line to get into today's Bamboozlepalooza event with the president, notwithstanding the appearance of her name on the event blacklist. In fact, the author of the blog says he just got off the phone with her. Whether the Patriot Act will need to be invoked to deal with Commissioner Coates is anybody's guess.
But this blog will probably have the story first.
--Josh Marshall
New poll out today says most Mainers believe Social Security has "major problems". But 68% want to keep it in its current form, while only 24.5% support private accounts.
No wonder Conscience Caucus member Sen. Olympia Snowe (R) wouldn't get up out of her seat.
--Josh Marshall
The fearful signs of recidivist faintheartedness, from <$NoAd$> the Hartford Courant ...
[President Bush] described the perils of the current system, how it would be "exhausted and bankrupt" by 2042. From the Democratic side of the chamber came cries of "no" - unusually raucous behavior for this most traditional of forums. And when Bush urged Congress to consider changes, only two Democratic senators - Connecticut's Joe Lieberman and Nebraska's Ben Nelson - stood up and applauded.
A Faction man till the end?
Meanwhile, Rep. Rob Simmons (R) of Connecticut, stays in the Caucus but flirts with losing his Loud and Proud status: “While I am wary of dramatic changes to a program so important to our seniors, I do understand the need to provide alternative retirement opportunities to younger workers. I look forward to this debate in Congress.”
--Josh Marshall
More on the Fargo blacklist (the Fargo Forty?), the list of more than forty locals, including city commissioner Linda Coates, who are banned from the location President Bush is speaking at in Fargo today.
We hear another fellow on list is none other than James Holm, the producer for Fargo-based progressive talk radio star Ed Schultz.
You'd figure he'll probably make some mention of this on the show today.
--Josh Marshall
Not a fun day for Conscience Caucus member Rep. Denny Rehberg of Montana?
He's tagging along today with the president's Bamboozlepalooza Tour.
But look at this poll that just came out from the Great Falls Tribune ...
President Bush might need to use all his Texas straight talk to convince Montanans to support letting individual workers invest part of their Social Security funds in stocks and bonds.Montanans oppose switching to personal Social Security investment accounts by a nearly 2-to-1 margin, according to a statewide opinion poll conducted for the Great Falls Tribune.
Nearly 59 percent of the 405 adults surveyed oppose the idea, while nearly 30 percent support it.
...
Baucus opposes the idea, citing concern about the estimated $2 trillion cost of making up for the money diverted into private accounts.
He also fears the president's plan will reduce benefits to future retirees.
Poll respodents leaned toward the senator, with 54 percent saying they are more likely to support Baucus' position on personal Social Security accounts. About 28 percent said they support the president's position. Another 18 percent supported neither position or were undecided.
Does someone need a Loud and <$NoAd$> Proud moment?
--Josh Marshall
Local Democratic officials banned <$NoAd$> from events on Bamboozlepalooza Tour?
Just like old times, I guess.
From North Dakota's Fargo Forum ...
Fargo City Commissioner Linda Coates is among more than 40 area residents included on a list of people barred from attending President Bush's speech today in Fargo.Among the 42 area people on the do-not-admit list: two high school students, a librarian, a Democratic campaign manager and several university professors.
White House spokesman Jim Morrell and Don Larson, a spokesman for the North Dakota governor's office, say they don't know anything about such a list.
"This is the first I'm hearing of it," Morrell said when contacted Wednesday.
But two sources close to Tuesday's ticket distribution confirmed the list exists and includes a handful of names of people who were not to receive tickets to today's event at North Dakota State University's Bison Sports Arena.
The list was supplied to workers at the two Fargo distribution sites, along with tickets and other forms citizens were asked to fill out upon receiving them. People who handed out tickets had copies of the list at their tables to determine if anyone should be denied access, both sources said.The list contains a wide range of people. Several wrote opinion page letters to The Forum criticizing Bush or the war in Iraq. Others wrote letters in support of gay rights or of Democratic policies.
It's subscription only. But if you register you can see the rest here.
--Josh Marshall
Milbank looks for signs of Caucus membership with hand-clap-ometer ...
When Bush told the crowd that personal Social Security accounts are the best way to improve the retirement system, most Republican lawmakers leapt to their feet. But a small band of moderates -- including Sens. Olympia J. Snowe (Maine), Susan Collins (Maine), George V. Voinovich (Ohio) and Mike DeWine (Ohio) -- were slow to join the applause. As others felt the pressure to come to their feet, Snowe, who has said she would "certainly not" support Bush's proposal, remained seated without applauding. She smiled uncomfortably and re-crossed her legs.
Remember for future reference, Collins easily swayed by colleagues' hand slaps.
--Josh Marshall
Sen. Baucus (D) of Montana has an OpEd in the Billings Gazette all set for the kick-off of the president's Social Security Bamboozlepalooza tour.
--Josh Marshall
The night of the long gavels?
Timed as it was to get lost in the hullabaloo of the State of the Union address, the Tuesday night/Wednesday morning purge of the House Ethics Committee was still a pretty audacious move.
It's been known for some time that the now-outgoing Chairman of the House Ethics Committee, Rep. Joel Hefley (R) of Colorado was going to get canned for his various offenses related to the Ethics Committee's handling, be it ever so gentle, of Rep. Tom DeLay (R) of Texas. The only mystery was just when the ax would fall.
But in this case, Speaker Hastert seemed to be channeling Michael Corleone in one of his less appealing moments.
As we noted back on November 19th, three of the five Republican members of the House Ethics Committee turned out to be in the Shays Handful. Or putting it more prosaically, three of them voted against the DeLay Rule.
The three were Hefley, Rep. Kenny Hulshof (R) of Missouri and Rep. Steven LaTourette (R) of Ohio.
Hastert axed all three.
The two who toed the DeLay line -- Rep. Judy Biggert (R) of Illinois and Rep. Doc Hastings (R) of Washington -- stay. And Hastings becomes Chairman.
Hulshof seemed surprised by the turn of events and in his own words, "deeply disappointed."
The following comes from the St.Louis Post-Dispatch ...
“I believe the decision was a direct result of our work in the last session,” Hulshof said in an interview, “particularly my chairing the investigative subcommittee” that examined ethics charges against DeLay, R-Texas, in the 108th Congress.Hulshof said his opposition to recent proposed changes of the GOP’s ethics standards may also played a role in his removal.
What's most telling, though, in this whole grisly affair is less the complaints of the purged than the comments of Hastert spokesman John Freehery who apparently couldn't be troubled to keep a straight face when denying that the purge was a purge.
This from the Rocky Mountain News about Hefley ...
John Feehery, a spokesman for Hastert, denied the charge, saying Hefley did a "great job" as chairman but had served the mandatory number of terms allowed without a waiver of House rules."He wasn't ousted. We have said all along we would make a change because that's what the rules state," Feehery said. "Any time you're (taken) off the Ethics Committee, it's not a punishment. It's not a joyful type of assignment."
And this about Hulshof from the Post-Dispatch ...
As for Hulshof, John Feehery, a spokesman for Hastert, said there was no connection to the DeLay matter and that the speaker simply wanted fresh faces on the panel.“It wasn’t really removing him,” said Feehery. “It was more like relieving him of his duty. The Speaker doesn’t like to have people who are such talented legislators like him have to spend so much time on ethics.”
Feehery noted that Hulshof sits on the Ways and Means Committee and “is likely to play a critical role on Social Security and tax reform.
“... Ethics is more of a burden than a privilege,” Feehery added. “And the speaker likes to mix it up,” referring to Hastert’s desire to put new members on the panel.
But Hulshof said he had specifically asked Hastert to reappoint him to the panel and noted that two other GOP members who were allowed to stay—Reps. Doc Hastings, R-Wash., and Judy Biggert, R-Ill.—have served on the committee longer than he has.
When corruption is really entrenched, there's no attempt to hide it.
--Josh Marshall
We told you on Tuesday night that Rep. Ron Kind (D) of Wisconsin was getting his papers in order to leave the Fainthearted Faction. And tonight he filed them.
The Milwaukee Journal-Sentinel quotes Kind calling the president's plan, "economically and morally irresponsible ... I am strongly opposed to any privatization plan that cuts current benefits or increases the federal deficit. Further, the president cannot continue his raid of the Social Security and Medicare trust funds on one hand and on the other hand allege that Social Security faces a financial crisis."
To the AP, he said: "The president's proposal to overhaul Social Security would drain more than $2 trillion from the Social Security Trust Fund over the next decade, endangering the benefits of current retirees and leaving a legacy of debt to our children and grandchildren."
These are the sorts of statements that are a bit vaguer on the policy nitty-gritty than we like to see. But it's the sort that got Sen. Dianne Feinstein (D) of California out of the Faction. And he makes up for vagueness with vehemence. So, on the totality of the evidence, Kind's out of the Fainthearted Faction.
That brings the House Faction down to a mere five members, two of whom already have OFO? status.
--Josh Marshall
The ax falls on Istook and our man Jonathan Kaplan has the story.
You'll remember way back when, after the aptly named Rep. Ernest Istook (R) of Oklahoma got his nose in a vise over his IRS-tax-return-snooping 'amendment', he went after a bunch of Northeastern Republicans by cutting off their transportation money. (Istook was chairman the Appropriations' Committee's Transportation Subcommittee.) You can read about it here along with the cackling remarks of his spokesman Micah Ledorf.
As we noted at the time, this was pretty foolish practice on the part of the House Republicans, since they may not be dominant in the Northeast. But they wouldn't have a congressional majority without healthy representation throughout the region -- something Istook's shenanigans put in danger.
Within a week, the sad-sack Istook was reduced to the ignominy of writing a public letter of apology to his colleagues.
And now, reports Kaplan, Istook's little stunt has cost him his chairmanship.
--Josh Marshall
Keep in mind that nothing that got said last night touched on the very big issues of disability and survivor benefits, which make up a substantial part of Social Security. That is money that in most cases, by definition, gets paid to individuals or on behalf of individuals who didn't have a lifetime of work to build up a private account. Where does that money come from?
--Josh Marshall
Atrios makes the expert catch here with this comment from Wapo associate managing editor Robert Kaiser ...
Even more curiously, a "senior administration official" who briefed reporters on the Social Security proposal earlier today disclosed details of the White House plan that I don't think will play well in Peoria. Most significantly, this official revealed that most or all of the earnings from new "personal" or privatized accounts will be paid not to the holder of the account, but to the government. The senior official called this a "benefit offset." It's one way to finance the creation of these private accounts, but it's going to cause quite a political stir, I think.
That's quite a deal, isn't it?
If you really do well in the market you might even work your way back up to what you were going to get anyway. Of course, that not counting the huge benefit cuts.
Here is the exchange with the mysterious "senior administration official" in question ...
Q Putting those aside, what is the revenue implication of a fully phased-in 4 percent account of the type that you've laid out?SENIOR ADMINISTRATION OFFICIAL: It would be very different depending overall on whether or not it was done alone or in the context of a comprehensive plan.
Q Assuming it's done alone, since that's all you're putting out here --
SENIOR ADMINISTRATION OFFICIAL: And the problem with assuming it's done alone is that we aren't advocating that it be done alone. We're advocating that it be done in the context of a comprehensive plan.
Q But people are going to want to know what is the cost.
Q But you're not saying what else is in there. You're not saying what else is in the comprehensive plan, so --
SENIOR ADMINISTRATION OFFICIAL: Well, when we have -- at the point where we can attach numbers to a comprehensive plan and model the effects of the accounts in that context, of course we'll put those numbers forward. But until that -- those specifications exist, we don't have the ability to project that.
Q In saying that there is no net added cost to the program, are you implying -- is it implicit that there is a benefit offset of one-third current guaranteed benefit because you're diverting one-third of revenues away from this program? If that's not correct, what would the benefit offset be to traditional benefits, and how would it be calculated?
SENIOR ADMINISTRATION OFFICIAL: The way that the election is put before the individual in a personal account structure of this type is that in return for the opportunity to get the benefits from the personal account, the person foregoes a certain amount of benefits from the traditional system.
Now, the way that election is structured, the person comes out ahead if their personal account exceeds a 3 percent real rate of return, which is the rate of return that the trust fund bonds receive. So, basically, the net effect on an individual's benefits would be zero if his personal account earned a 3 percent real rate of return. To the extent that his personal account gets a higher rate of return, his net benefit would increase as a consequence of making that decision.
Q So he would only get a benefit to the extent that his portfolio performed in excess of 3 percent?
SENIOR ADMINISTRATION OFFICIAL: Right. You can think of it as saying -- if you were making a decision on where to put your money going forward over the next 10 years, and you're saying, should I put it in this account or that account, if you're choosing to put your money over here instead of over here, then the net effect on you, as an individual, is to compare what would be the rate of return you get from this system, as opposed to putting it over here. And that would be the difference between the two.
Q Short of 3 percent, would he make whole or would he get less than the current guaranteed benefit?
SENIOR ADMINISTRATION OFFICIAL: Well, there's a implication at the end of your question which -- you have to remember, the current system can't pay the current guaranteed benefit, so --
Q -- is to be paid through 2042 or 2052, the point -- are you suggesting that would not be paid?
SENIOR ADMINISTRATION OFFICIAL: Well, it's -- well, actually, it's -- I don't want to get off on too far of a tangent, but the Congressional Budget Office actually put out a paper this week which made a modification to what they had previously said about what current law was. And they made it very clear that current law is actually the level of benefits the current system can actually pay, as opposed to the level of benefits the current system is promising. So if you ask the question in terms of --
Q But they also said it can pay current level benefits until 2052 -- correct?
SENIOR ADMINISTRATION OFFICIAL: But the Congressional Budget Office is also very careful to say that starting in 2019 or 2020, the resources are not there to pay those benefits.
Again saying the Trust Fund doesn't <$NoAd$> exist. Like we've said, it's all about trying to find a way out of paying the money back under the grand agreement of 1983.
--Josh Marshall
Okay, for all you TPM readers who have been quietly tapping away at your keyboards looking for that find or catch that will earn you one of the prized Special Edition Privatize This! TPM T-Shirts, your wait is over! Or at least, it's over if you've already won one! Or, well, something like that. But the bottom line is we've got the T-Shirts.
We've already awarded a number of them to TPM readers who tracked the evolution of the Social Security speech code and we'll be giving out ten more tonight and tomorrow for eagle-eyeing the State of the Union address and its aftermath.
And of course, if you'd rather just drop down a few bucks and buy the T-shirt as a straight cash transaction, well, we can help you there too.
It turns out there's a men's version and then a women's version of the shirt. Why each gender gets their own version I don't precisely understand. But my one-and-only tells me that's how it is. So that's how we're going to do it. And if that isn't enough there's even the obligatory 'Private This' mug.
If you want to see what the thing looks like, click here to see the front and here to see the back. And to buy one you can go here.
A couple quick points. We make five bucks a piece off the shirts and the money goes to supporting TPM. On the image of the front of the shirt, you can't really make it out clearly, but the smaller text under "Privatize This!" says "*eyes and ears on loan to talkingpointsmemo.com", which we thought was kinda cute and had the added advantage of accurately describing how involved, watchful and vigilant readers are what makes this sort of enterprise possible.
In any case, on to other posts now. But politics isn't just about beliefs and policies and arguments. It should also be fun. Because fighting for things you believe in with some punch in your step, a glint in your eye and a confidence in results is fun. The center-left managed to lose a lot of that moxie over the years for a long list of reasons, some of them inevitable. But it's recoverable.
--Josh Marshall
I guess they call it fact-checking ...
"Our society has changed in ways the founders of Social Security could not have foreseen. In today's world, people are living longer and therefore drawing benefits longer - and those benefits are scheduled to rise dramatically over the next few decades."
State of the Union Address
February 2nd, 2005
"In 1934, when Franklin Roosevelt formed the Committee on Economic Security to design what was in effect the first federal safety net, the committee hired three actuaries to stargaze into the future. The actuaries predicted that the proportion of Americans over 65 -- then only 5.4 percent -- would rise to 12.65 percent in 1990, meaning that retiree costs would soar. They were just a tad high; the actual figure would be 12.49 percent."
One of the small lies of the evening, <$NoAd$>to be sure. But then, isn't it the small lies that somehow matter most. Pardon our Hallmark moment ...
--Josh Marshall
We're going to have to wait for official confirmation. But from what we're hearing from readers watching the coverage, Sen. Mary Landrieu (D) of Louisiana may have picked tonight to leave the Fainthearted Faction.
Is Sen. Carper (D) of Delaware going to be left as a Faction of one?
--Josh Marshall
And we're off ...
I had the text of the speech a bit in advance. But I intentionally didn't read it because I wanted to hear it first as a speech rather than in the written word.
And I found the choices imbedded in the speech quite surprising.
First, there wasn't all that much about Social Security, and quite little that was new.
As someone who is not at all neutral on whether Social Security should be preserved or dismantled, that struck me as a missed opportunity. It's not every day that even the president gets an hour with the American people, with all the pomp and ceremony reared up in his favor. Even the privatizers have a story to tell. And the State of the Union gives the president a moment of conversational intimacy with the American people. On Social Security, I don't think he made much good use of it. And there was little on Social Security at least that was memorable.
As a final point along those lines, I also thought he did little to weave a narrative about privatization into the other themes of his presidency. The whole second half of the speech (I wasn't watching a clock; but that was my sense) was about foreign policy issues that are distant from what the country will be debating in the coming months. They remain issues of deadly importance and high ideals; everyone can agree to that. But nothing was connected together -- no bridge from the issues and touchstones which won him reelection to the policies he now wants to enact.
A few other observations.
First, now we know how much phase-out the president wants: 1/3 of Social Security. He said so tonight. So at least that nugget of his plan is clear.
Second, there were a slew of bones tossed to the cultural right pretty clearly aimed at bringing them back on board the phase-out bandwagon. Again, it didn't seem woven together, all disconnected.
Third, the president is now saying -- and saying emphatically and militantly, with an eye on his critics -- that if you're 55 you're home free, nothing to worry about when it comes to phasing out Social Security.
One might observe that this is a rather unfortunate dividing in half of the country. If you're 50 today, you spent most of your highest earning years not only paying into Social Security, but advance-paying even more, under the 1983 Social Security Commission which put in the extra level of tax to build up the Trust Fund. Now you're hosed. Too bad.
The important point though is that this is simply not true. And the defenders of Social Security would be straight-up fools to let the president get away with a guarantee as obviously bogus as that one.
The president can say whatever he wants. But the truth is he's going to try to siphon off one out of every three dollars that goes into Social Security -- the money that goes to pay those benefits he's telling you 55-and-over folks not to worry about.
Remember, he says the program's in trouble in 13 years and bankrupt in less than forty as it stands now. And now he's telling people who are 55 and over that they can rely on the program with complete confidence even though, under his new plan, it'll have to make do with 2/3 of its current revenues.
Does those two facts compute to you? You think that might put a little stress on the system? Even if the president just decides to pull out the national Visa card and borrow a few trillion more dollars to make up the shortfall, that will just come back and hit the program in other ways and more than soon enough to hit people a decade from retirement. People who are 55 today will be alive in 10, 20, 30 and more years from now. And like so many of President Bush's promises this is one he couldn't keep even if he wanted to.
With Social Security phase-out, we're all in the same boat. Actually, let me rephrase that: With Social Security we're all in the same boat. With phase-out, it's everyone overboard and every man for himself.
--Josh Marshall
"New Details Indicate Administration Social Security Plan Would Entail Several Trillion Dollars In Borrowing."
That and more just out from the Center on Budget and Policy Priorities.
(Tim, you could read it so quickly. And so many errors could be avoided. Pass it on to Fineman when you're done. Also, remember the CPI calculation debate and the wage or inflation indexing debate are two different issues. I'm just trying to help! I'm on your side!)
--Josh Marshall
If we're not mistaken, tonight's State of the Union address (aka, the kick-off of the Bamboozlepalooza Tour) should knock the Fainthearted Faction and the Conscience Caucus into utter turmoil. And pretty much every member of Congress is going to be asked by some reporter somewhere what they think of President Bush's Social Security phase-out plan.
And let's be clear, that's what this is. The idea of phasing out only part of Social Security is just a con. The plan here is to get rid of Social Security entirely and replace it with a government system of private investment accounts in which everyone can sink or swim as well as they can manage.
If you don't make enough during your working life to save much, you're out of luck. If your investments go bad or you die young, you and your kids are out of luck too. On the margins there may well be a new system of elder welfare for those who can prove they would die or be without any means of support absent a government hand-out. But gone entirely will be the current Social Security system in which every American who pays into the system over their lifetime has a guaranteed bedrock of retirement security which can't be taken away ever, not as a matter of a handout or disgrace or pity, but as a matter of right to a modicum of comfort and dignity in retirement after a lifetime of work.
If you doubt that the plan is to get rid of Social Security entirely you are simply naive. Look at the structure of all the phase-out proposals. They don't really envision a hybrid system for the longterm. They are all designed to siphon money out of the system, weaken it, trigger the crisis President Bush now falsely claims exists and create an accelerating pressure to complete the process of phase-out.
If you think about it, nothing else would really make sense. If partial phase-out is a good thing, why isn't total phase-out even better? This isn't about solvency; it's about the ideology of people who don't believe in or approve of the near-universal, defined-benefit program America has had for seven decades.
That's the plan and that's what's at stake.
We could have an honest debate about whether we'd be better off with Social Security or a system of government-regulated 401ks in its place. But the president knows that's a debate he can't win. So he's trying to scam the public into helping him destroy what the vast majority want to protect.
Social Security can be put on the course to complete phase-out in the 109th Congress, or the effort to phase-out Social Security can be put to rest for decades. If a newly-reelected president, with compliant majorities in both houses of congress, and all the weight of his office put behind the effort gets stopped in its tracks by a battered, but recovering party like the Democrats now are, no one will try it again for a very long time.
So, tonight ... As I said, everybody's going to get asked about phase-out tonight. And we want to hear what you hear. We can only follow so many news outlets. We have our special email address still set up (lyingprivatizers@talkingpointsmemo.com). So if you see some member of the Conscience Caucus going all wobbly and sidling up to the president's phase-out proposal, let us know. If others give it the thumbs down, let us know that too. We'd like to hear about it even if it's just existing members of the Caucus reaffirming their membership.
Same goes for the Dems. If someone starts to go wobbly, we'd really appreciate your telling us.
So we can make use of it in our efforts to cover the legislative battlein its totality, please give us as much detailed information as possible about when it was, where it appeared, and so forth. If possible, send us a link.
And watch the press. The president already got knocked on his heels for his 'crisis' malarkey. Will that affect the degree of credibility the media imputes to him now on related issues?
The White House has already signalled that a big part of the speech will be rolling out his new Social Security speech code. So if you see Tim Russert running away from the phrase 'private accounts' like it was the bubonic plague, can you let us know? Thank you. We'll be in your debt.
And if the dingbat neologism 'personalization' even crosses Andrea Mitchell's lips, can you tell us that too?
The Republicans have every right to use their own rhetoric to describe their own policies. But it's ridiculous for them to think they can force the press to adopt a new lexicon every time the pollsters come back to Karl's office with a glum face. And it is shameful when members of the press comply. So keep an eye out and let us know.
We'll be giving away 'Privatize This' TPM T-shirts for the top ten catches of the evening (ed.note: just remember that they have to go to the special email address to be considered)...
--Josh Marshall
As we noted earlier, Rep. Jim Kolbe (R) of Arizona and Rep. Allen Boyd, the Dean of the Fainthearted Faction, held a press conference yesterday on Capitol Hill to unveil their Social Security phase-out legislation which they call the "Bipartisan Retirement Security Act of 2005."
They handed out a detailed summary of the legislation, a document describing its purported effect on women and another describing its purported effect on people with low incomes. They also put out this 'Short Summary' of their legislation, which we've posted here in annotated form for your reading pleasure.
--Josh Marshall
Her own private Fainthearted Faction?
The Times-Picayune gives the run-down on Louisiana Dems and where they come down on Social Security phase-out ...
Sen. Mary Landrieu, D-La., who represents a state Bush won by 15 percentage points and is often a swing vote in the Senate, said Tuesday she had not formulated a position on private investment accounts. A spokesman said Landrieu would oppose anything that calls for benefits cuts or that increases the deficit.Landrieu's legislative director, Jason Matthews, said she is unlikely to support letting workers divert a portion of their payroll taxes to accounts that they could invest on their own.
Matthews also said he has seen no sign that the White House is trying to build a bipartisan consensus.
"Where is the bipartisan solution? There are only six or seven (swing) votes, and we're one of them," Matthews said. "There hasn't even been a preliminary 'Hey, how do you do?' with anyone from the White House."
By contrast, the two other Democrats in Louisiana's House delegation, Reps. William Jefferson of New Orleans and Charlie Melancon of Napoleonville, said they were firmly against the creation of private accounts. The lawmakers said that no matter how they are structured, the accounts offer too much of a risk to retirees, many of whom are dependent on Social Security for their sole means of support.
No 'how do you do'?
Mary Landrieu, looking for love in all the <$NoAd$> wrong places?
--Josh Marshall
Fainthearted Faction Dean Rep. Allen Boyd (D) of Florida, the Panhandle Poltroon, puts his cards on the table. More soon ...
--Josh Marshall
Staten Island Congressman Vito Fossella (R) tries to bamboozle constituents spinning <$NoAd$> them with the same old 'privatization' word games.
From today's Staten Island Advance ...
Rep. Vito Fossella told senior citizens at the New Dorp Beach Friendship Club yesterday that he is against privatizing Social Security."Let me be clear," Fossella (R-Staten Island/Brooklyn) told over 130 seniors at the center. "I do not support the privatization of Social Security, I never have and I never will."
However, Fossella said he wouldn't rule out "exploring" with House lawmakers the concept of allowing young workers to set aside part of their payroll taxes into personal market accounts instead of contributing the money to the Social Security system.
Here's some more info about New Yorkers trying to get Fossella to phase out his support for phase-out.
--Josh Marshall
Chris Matthews stumbles, then tries to get right with the president's Social Security Speech Code.
From last night's Hardball: "All these programs, one which will privatize this, personalize, to some extent, Social Security."
--Josh Marshall
The Daily Scribble goes behind the scenes at the president's speech prep.
--Josh Marshall
Who got to Sherry Boehlert? Did they make him an offer he couldn't refuse?
We knew the day would come, but we can see here that the days of trials have begun for the Conscience Caucus.
Just shy of two weeks ago Rep. Sherwood Boehlert (R) of New York told his constituents: "I’ve never been a gambler … I don’t want to gamble with Social Security trust fund moneys. And so I am very, very skeptical of the so-called plans to privatize. And I think a disservice is being done to a great many Americans by sort of sounding the alarm that everything’s going to hell in a hand basket and we’re going to be broke by 2018. That simply is not so."
But look at today's Poughkeepsie Journal and see what a change a few days back in DC has wrought: "Boehlert said he needs to hear more details before deciding whether to support the [President's Social Security] plan. But he praised Bush for trying to tackle the politically difficult issue."
So, now, not only is Boehlert open to supporting the president's phase-out plan, he's also praising him for trying to fool the public into thinking the program is going broke.
Perhaps some of his constituents can throw Sherry a lifeline. But for the moment we're going to have to shift him to the new Conscience Caucus "CUP" ("Caving under the pressure") status.
--Josh Marshall
Kudos to the Times editorial page for Tuesday's editorial poke at the president's new Social Security speech code.
--Josh Marshall
President's new Social Security speech code defied at the Times!
Robin Toner goes with "private Social Security accounts" and "private accounts," but not a 'personal account' to be seen anywhere.
She even gets freaky with "privatize" ...
--Josh Marshall
Rep. Ron Kind (D) of Wisconsin filling out the paperwork to leave the Fainthearted Faction?
--Josh Marshall
Yet another local Democratic party resolution against phasing out Social Security -- this time from the Groton (CT) Democratic Town Committee.
--Josh Marshall
Another local Democratic party resolution against phasing out Social Security.
--Josh Marshall
The Conscience Caucus opens up a Kentucky chapter with the arrival of freshman Rep. Geoff Davis (R).
An article in Saturday's Cincinnati Enquirer reports: "Davis has said he will not support Bush's plan to allow workers to invest a percentage of their payroll taxes into self-directed personal investment accounts."
Says spokesperson Jessica Towhey: "Geoff Davis is against private accounts. He is also for no decrease in benefits and no increase in payroll taxes."
Towhey includes the obligatory note that Davis is waiting to see the president's actual plan before making a final judgment. But from the looks of it, we see no choice but to slot Davis as Loud and Proud.
--Josh Marshall
Sen. Reid says that Senate Faction is no more?
Key passages from the early afternoon update from CQ Today that has the Hill atwitter ...
Not a single Senate Democrat will support President Bush’s proposal to divert a portion of the Social Security payroll tax to personal investment accounts, Minority Leader Harry Reid, D-Nev., said Tuesday.If he is right, Bush’s plan will be dead on arrival in the Senate, where a supermajority of 60 votes will be needed to overcome a filibuster by opponents. Republicans have 55 seats.
...
“We want to make sure that the American people understand that we’re not for benefit cuts and we’re not for privatization,” Reid said. “There’s no crisis in Social Security.”
...
Reid said he had private commitments from all 44 Senate Democrats that they would not support diverting payroll tax revenues into private accounts, the key facet of Bush’s plan. The Democratic staff on the Senate Finance Committee has come to the same conclusion, based on polling Democratic members and their staffs.
Some Senate Democrats, including Mary L. Landrieu of Louisiana and Ben Nelson of Nebraska, have said publicly they are open to considering a Social Security overhaul, including personal accounts, though they have not committed themselves either way. But “add-on” personal accounts, which a number of Republicans also favor, would supplement Social Security benefits and would not draw from payroll tax revenues for financing — keeping these senators within their pledges to Reid.
When you add in the Loud and Proud <$NoAd$> Snowe and Specter, plus the almost-sure-to-defect Chafee, 50 votes in the Senate looks like a challenge in itself ...
--Josh Marshall
Rep. Gene Taylor (D) of Mississippi, standing tall, walks right out of the Faction. We don't have a 'Loud and Proud!' category for Democrats opposing President Bush's Social Security phase-out plan. But if we did, Rep. Taylor would be in it today.
Take a look at the new statement up today on Rep. Taylor's website.
--Josh Marshall
I'll see your mumbo and raise you a jumbo: President releases unofficial dates for bamboozlepalooza tour ...
THURSDAY: Fargo, ND; Great Falls, MT, Omaha, NE.
FRIDAY: Little Rock, AR, Tampa, FL.
Look at who represents the Tampa area, read this article, look at the Conscience Caucus and then tell me whether Sen. Nelson (D) has anything to do with the president's trip to Florida.
Late Update: This Florida blogger, who knows the terrain, provides more details.
--Josh Marshall
"Today's Fiscal Policy is Unsustainable."
That's chapter one of an important new report out today from the GAO.
--Josh Marshall
Yep, I think we've got another Loud and Proud Republican on our hands.
According to the Anchorage Daily News, Rep. Don Young (R) of Alaska "ridiculed the president's assertions about a Social Security crisis" in a "wide-ranging interview session with Alaska reporters in his House office" on Monday. And just two days before the release of the president's new Social Security speech code no less!
Later down in the piece comes the following ...
Young scoffed at President Bush's claims that Social Security needs an immediate fix."We do have a slight problem," he said. "I think there's a possibility of a problem 45 years from now."
And Young said he remained "very unsold" on Bush's solutions to privatize Social Security.
"I'm not overly confident the average American knows how to invest in stocks," he said. "I don't want Wall Street involved in this."
Young said he would support making current individual retirement accounts more attractive through tax-law changes.
You kinda get the sense he's not on <$NoAd$>board with phase-out, right?
[ed.note: A special note of thanks to TPM reader DD for the tip.]
--Josh Marshall
The latest from the Center for American Progress ...
From the people who bring you The Progress Report – the daily electronic newsletter the National Review calls "the most aggressive, most energetic opposition research in politics" – comes Thinkprogress.org, a new blog ready to revolutionize the world of research-intensive rapid response. Debuting in tandem with the State of the Union address on Feb. 2, Thinkprogress.org will give journalists and the public real-time access to American Progress’s highly regarded rapid response operation for the first time ever. And in honor of the launch, American Progress CEO John Podesta will be a guest blogger, providing live commentary throughout the entire State of the Union address.
That should be <$NoAd$>interesting.
--Josh Marshall
With less than 36 hours before the president kicks off his bamboozlepalooza tour, the turmoil and turnover within the Fainthearted Faction continues to grow.
The first news comes in a piece from the New York Times titled '6 Key Democratic Senators Oppose Bush Plan on Benefits.'
On first glance, the title seems to signal a veritable Fainthearted Faction Monday Night Massacre. But while the content isn't nearly so dramatic, the piece nonetheless contains some important news.
The lead graf reads: "Six of the seven Democratic senators from the states where President Bush plans to campaign this week for his Social Security plan say they are unalterably opposed to his main principle of diverting tax money into personal investment accounts." And then later down in the piece: "If Mr. Bush cannot win the support of these Democratic senators from states where he is politically strong, it may indicate that he cannot provide the political cover that many Republican lawmakers say they will need if they are to take the political risk of voting for the president's plan."
The question is, which senators are they talking about? Four of them are Sens. Baucus, Dorgan, Nelson of Florida and Pryor. And they aren't in the Faction to start with. The seventh is Sen. Nelson of Nebraska "who said in an interview [with the Times] that he could not make a commitment on Social Security until he saw the specifics of the president's plan."
So that leaves him where we have him now -- in the Faction, but with OFO status.
The two final ones are Sens. Conrad and Lincoln.
Conrad was only barely in the Faction and only entered a few days ago. He tells the Times: "I will not be part of the unraveling the commitment of Social Security based on gutting the benefits and hoping the stock market makes up the difference and funding the transition with borrowing."
That, combined with the Times' characterization of the whole interview, and the only slight signs of Faintheartedness which got Conrad into the Faction, now takes him out.
From Sen. Lincoln, the Times got: "I'm opposed to what the president presumably wants to do. It puts in jeopardy a program that is vital to the people of Arkansas and is misleading to the young people about what they're going to end up with."
Based on the that and the totality of earlier evidence, she's out of the Faction too.
That leaves a winnowed down Senate Fainthearted Faction of four, including Nelson of Nebraska. The other three are Carper, Landrieu and Lieberman.
We haven't heard much from Carper recently.
Lieberman has had almost two feet out the door ever since his appearance on The Daily Show back on the 20th of last month. His comments on Social Security to Jon Stewart all but took him out of the Faction. But given the venue and the nature of the remarks combined with Lieberman's earlier history of recidivist Faintheartedness on phase-out, we've had something of a vexed internal debate about Lieberman's standing in the Faction.
What we decided was that we would wait for one more statement of opposition to phase-out from Sen. Lieberman, at which point he would be automatically removed from the Faction. We spoke to his office this morning and apparently the Daily Show remarks are still his most recent. So for the moment, he stays.
That leaves us with Sen. Landrieu of Louisiana. At the moment, she appears to be the senate Democrat most wedded to membership in the Fainthearted Faction, having not even given hints of imminent withdrawal. One of our most prized TPM readers is a retiree from Landrieu's home state and she's been trying for weeks now to get an answer from the senator's office about where she stands on phase-out. Finally, this week, she was able to get hold of someone in Landrieu's office who could speak to the issue. And the senator's position, she was told, is that she hasn't yet taken a position.
--Josh Marshall
Our text of the day today comes from yesterday's CongressDaily PM ...
Wednesday's State of the Union speech and the subsequent unveiling of the Social Security plan will also provide Republicans with the first major test of the media and message strategies that have been developed for the Social Security debate. At the center of the GOP pitch is a language "branding" plan that Republicans hope will undercut Democratic criticism of Republican plans. For instance, the GOP has been pushing to move from describing the investment accounts as "private," preferring to use "personal," which they believe is less loaded politically. Similarly, Santorum said Friday he preferred to avoid calling costs associated with the creation of the accounts "transitional," favoring the use of "prepaying." A senior GOP Senate aide acknowledged that both of these semantic changes are part of the party's broader strategy to reframe the Social Security debate.
So there you have it, <$NoAd$> the president's State of the Union address is to be dedicated in large part to promulgating the new Social Security speech code already in evidence from Republicans over recent weeks.
The question is, how will this be reported?
And which news outlets will simply adopt the speech code either out of deference to the president or inherent simpletonian tendencies?
Pick your talking head, grab your notepad and get ready to jot.
--Josh Marshall
In his Tuesday column, Paul Krugman hits the big question that shames every reporter who hasn't posed it to the president or whichever other privatizers they can finagle a minute with. It's as simple as this: the privatizers base their predictions about privatization on a 21st century of robust economic growth while they foretell Social Security's bleak future based on a 21st century of anemic economic growth -- a classic apples and oranges comparison which, if anyone were paying attention, would stop the whole debate in its tracks.
If you're not Tim Russert, read the column. If you are, hang your head in shame, buy an abacus and then go read Krugman.
--Josh Marshall
This new article in the St. Petersburg Times chronicles the sorrows and sufferings of Florida's Republican congressional delegation. The article, somewhat surprisingly, places Rep. Bill Young (R) in the Conscience Caucus -- and we've followed their lead.
"I'm not going to support anything that makes Social Security subject to the stock market," said Young. "I have always been very careful to make a decision regardless of politics. I don't think a decision should be made based on whether you support the president or don't support the president."
The article goes on to note that even Rep. Clay Shaw (R) is now claiming he "wants Congress to find a way to add investment accounts without using Social Security," in the words of the Times reporter.
We remain skeptical that Shaw is so far off the reservation. But apparently this truly is a time of testing since Rep. Mike Bilirakis (R) declined even to comment for the story, thus placing himself into that distinguished fraternity of congressional worthies who pass on press attention.
The really rich prose in the Times piece, however, is reserved for Rep. Ginny Brown-Waite (R), who's keeping up her performance art routine as the fairer-sex Hamlet of west-central Florida, agonizing -- to paraphrase the Times -- over whether to 'tis nobler to serve the interests of thy constituents or "allegiance to the Republican agenda."
We keep hearing that Brown-Waite is stiffing constituents who are trying to find out where she stands on phasing out Social Security. So, as in the case of Montana, we have to ask: will Brown-Waite be travelling or appearing with the president in Florida?
Will she be endorsing his phase-out plan?
How about Reps. Harris, Shaw and Young?
[ed.note: Are you represented by Rep. Brown-Waite? Do you live in Florida's 5th congressional district? If so, drop us a line.]
--Josh Marshall
As usually happens when a bit more hard data comes in and replaces pessimistic prognostication, the Social Security gotterdammerung gets pushed back even further. So says the CBO today. This time from 2018 to 2020, as the date that Social Security will begin drawing on its accumulated Trust Fund money.
It's a small nudge, but a telling one.
The program is in such a dire state of crisis, it would seem, that every time the bean counters run the numbers, its solvency seems assured even further into the future.
As in Iraq, you start to understand that there is a Social Security crisis. The longer President Bush waits, the more likely it is that even rosier numbers will come out on Social Security's long-term financing.
There really isn't a moment to lose.
--Josh Marshall
Thursday is the day that President Bush is scheduled to head out to Montana to hold a few town meetings on phasing out Social Security. Expect the benighted bigs to focus on whether Bush can put the screws to Sen. Max Baucus (D). But you, who are among the TPM illuminati, know that the real issue is whether President Bush, coming right off his State of the Union address, can pry an endorsement loose from the state's sole congressman, Rep. Denny Rehberg (R).
Back on November 17th, Rep. Rehberg told the Great Falls Tribune that he was still pretty leery about President Bush's plan to phase out Social Security.
As reporter Mike Dennison put it ...
U.S. Rep. Denny Rehberg, Montana's sole House member and a Republican, says he's a long way from feeling comfortable about "privatizing" or allowing "personal accounts" with Social Security funds, as suggested by the president."I haven't seen anything I can support yet," he says.
But Rep. Rehberg's views on private accounts are fluid or perhaps best described as evolving, if not always in the same direction.
In a campaign trail debate in June 2000, for instance, he endorsed private accounts, telling the debate moderator, "We shouldn't be propping up a failed system."
In an earlier debate he asked rhetorically, "Why shouldn't we believe that somebody else could manage that money better than somebody in Washington, D.C.?"
Indeed, as we dug into this story we discovered that Rehberg was actually something of an early innovator in the Social Security speech code wars. Back in 2000 he repeatedly endorsed setting up private accounts within Social Security. But when opponent Nancy Keenan had the temerity to call this 'privatization,' Rehberg wouldn't stand for it.
Campaign manager Alan Mikkelsen said Rehberg simply wanted to allow workers to invest a portion of their Social Security taxes in private investment accounts. "That's a far cry from privatization," Mikkelsen harrumphed to AP reporter Bob Anez.
In another press comment, Mikkelsen said Rehberg "doesn't want to privatize Social Security, but rather wants to explore the option of allowing future recipients to voluntarily invest a portion of their payroll taxes in individual savings accounts."
In any case, with all the sand kicked in the air, I wanted to see if there'd been any movement in the congressman's position over the last two months. When I rung him up this afternoon Rehberg spokesman Brad Keena told TPM that the congressman "does believe in a plan that will fix and reform" Social Security. He's just not ready to endorse the president's plan.
With regard to all the options on the table, Rehberg is "very open-minded," Keena repeated several times.
"Really, we haven't gotten this national debate into swing yet. We just got the information on [the president's Social Security plan] and he's begining to study it."
Presumably, by Thursday he'll have had a chance to study it more closely. And according to Sunday's piece in the Great Falls Tribune, Rehberg will be travelling with the president when he comes to the state.
So a pretty straightforward question for the media folk travelling with the president. Will Rehberg endorse, or no?
--Josh Marshall
Former Sen. Bob Kerrey flacks phase-out on the WSJ editorial page, joins Gov. Ed Rendell as Associate Member in Fainthearted Faction, sends uncertain signal about New School gig.
--Josh Marshall
It's a mixed day for Mainers on the Social Security front.
On the basis of two articles in the Washington Post last week, we've elevated Sen. Olympia Snowe (R) into "Loud and Proud" status within the Conscience Caucus.
Here Snowe tells reporters she will oppose diversion of payroll tax revenue into private accounts. And earlier in the week the Post quoted her saying that she is "certainly not going to support diverting $2 trillion from Social Security into creating personal savings accounts."
On the other hand, Snowe's colleague, Sen. Susan Collins (R) doesn't seem to want to tell her constituents anything about her position on phasing out Social Security. In this letter to a TPM reader constituent, all we could divine from Collins' opaque doubletalk was that she's started using the last buzzword from the GOP Social Security speech code, referring to privatization as "modernization."
--Josh Marshall
Wow. He's sure a downer.
We noted earlier that Rich Thau is the guy who helped the congressional Republicans put together the Social Security playbook they huddled with over the weekend. Here on the Third Millenium website is Thau's promotional video. Right after the screen flashes "the media turn to him for provocative commentary," at timestamp 3:35, Thau hits listeners with this doozy: “If we do nothing between now and the year 2012, we have two drastic options. The government can either cut benefits by about thirty percent or raise payroll taxes by thirty percent. Both are very unpleasant.”
Presumably he was working from the ridiculously pessimistic numbers of a few years ago, not the more up-to-date ridiculously pessimistic numbers. But doesn't the phase-out crowd say that the Social Security gotterdammerung happens in 2042 or 2052?
--Josh Marshall
Hmmm. That's interesting.
Down at the very bottom <$NoAd$> of the GOP Social Security playbook we just posted, there's a sample speech for pitching phase-out to audiences 50 and over. It starts on page 83 of the PDF document. Then if you go down to the end of the speech there's a footer that says ...
This speech was developed by
Presentation Testing, Inc.
For more information about how this speech was developed, please contact Rich Thau at Presentation Testing, Inc. at 212-760-4358.
(Before that sample speech, there's another for young voters which includes the same authorship note.)
Well, TPM reader GD typed Mr. Thau's name into google and found this PDF document in which Thau describes one of the seminars he does. And right there at the top of the document, Thau quotes himself saying: "I've testified on Capitol Hill. I have worked with many members of Congress. They are not committed to passing laws to give your employees retirement security."
This is the guy who's teaching congressional Republicans how to pitch private accounts? The guy who says he knows from experience that members of Congress -- or at least the ones he deals with -- aren't serious about retirement security?
He's quite a character reference ...
Late Update: In this recent article Fred Barnes notes that Thau and Frank Luntz have worked as co-muddlers. The two, it seems, have been comrades-in-arms in the Social Security speech code racket. Thau's company, Presentation Testing, Inc. would appear to be colocated with his Gen-X pro-phase out group Third Millenium. And if you'd care to hear Mr. Thau's views in person, you can hear him on the afternoon panel on day two of the Cato Institute Social Security conference which runs February 8th and 9th.
--Josh Marshall
A few house-keeping <$NoAd$> notes.
We're hoping to be able to ship 
out the first batch of our uber-cool 'Privatize This' TPM T-Shirts on Wednesday just in time for the kick-off of the president's Social Security bamboozlepalooza tour.
If you've already won a shirt for your fact-finding activities, yours should ship out then or very soon after. As noted earlier, those prefering to operate strictly through the cash nexus will be able to purchase them as well.
The back has the image right there on the side, while the front has the 'Privatize This' banner.
Two other points.
We're going to try to bring you an annotated edition of the Republican strategy memo which we posted earlier today. And today or tomorrow we'll also be posting those 'privatization' flimflam quotes that readers helped us track down.
--Josh Marshall
Rep. Howard Coble (R) of North Carolina sidling up to the Conscience <$NoAd$> Caucus?
From the News & Observer ...
"This is going to be a very tough lift for all of us," said Coble, the longest-serving member of North Carolina's congressional delegation.Coble has been battling the perception that Republicans would dismantle Social Security since he first ran for Congress 20 years ago.
He cut an ad during that campaign, with his aging parents sitting on a front porch, saying Coble would never hurt Social Security.
"My mama said, 'If he does, I'll take a switch to him,' " Coble said in an interview.
Coble's mother is now 95, and she still would, Coble said.
Coble said he favors fine-tuning rather than overhauling. He finds personal savings accounts "not to be offensive," although he said it's too soon to stake out a position on a plan that has not been presented.
"It's a long way between here and where we tie this ship to the dock," he said.
With such a flood of new members, the Caucus has tightened its eligibility requirements. But Rep. Coble seems like he might want in.
Someone check back with Coble on Friday and see whether Howard's gonna have to take a whoopin' for ole' George W.
--Josh Marshall
This document is already circulating pretty widely. And I suspect it's already available at other sites. But in case you haven't had a look, here's the Social Security phase-out strategy playbook congressional Republicans used at their retreat over the weekend.
--Josh Marshall
Occasionally the import of a tongue-in-cheek post doesn't sink in satisfactorily. So lest there be any confusion, when President Bush hits the road on his pro-phase-out barnstorming tour later this week, defenders of Social Security should make it exceedingly clear that in states like Montana, where the president is allegedly trying to muscle Democrats into supporting his bill, he still hasn't gotten the key Republicans to sign on. Rep. Denny Rehberg (R) in Montana is but one example.
In a state like Florida, it is also an opportunity to get all those zipped-lip Republican reps from Florida to tell their constituents whether they support the Bush plan or not.
--Josh Marshall
We were scratching our heads <$Ad$>trying to understand it. Why is President Bush heading out to Montana after his State of the Union address when Sen. Baucus (D) just couldn't make it any clearer that he's not going to vote for a Social Security phase-out bill?
We tossed around a bunch of possible explanations before suddenly the mysterious hidden truth revealed itself: Baucus is just a cover. President Bush is really going to Montana to muscle the state's sole member of the House of Representatives: Rep. Denny Rehberg (R).
Sure, he may have flown under the radar until now. But when asked about the president's phase-out plan back in mid-November, here's what he told the Great Falls Tribune ...
U.S. Rep. Denny Rehberg, Montana's sole House member and a Republican, says he's a long way from feeling comfortable about "privatizing" or allowing "personal accounts" with Social Security funds, as suggested by the president."I haven't seen anything I can support yet," he says.
Not only is Rehberg suggesting he won't vote for phase-out, he's even using the demeaning 'privatizing' buzzword that even most national political reporters aren't allowed to use anymore. That's insubordination this president won't stand.
And along these lines, what about the other states the president is hitting on the campaign trail? I would hate to think that any responsible journalist would cover the president's swing through Florida without finding out whether he's able to get Conscience Caucus members Rep. Ginny Brown-Waite (R) or Rep. Katherine Harris (R) to sign on.
And what about Sen. Chuck Hagel (R) out in Nebraska? He's been awful silent.
I mean, c'mon. The real question here is whether the president can get members of his own party on board.
--Josh Marshall
Mike Allen has a nice piece in tomorrow's Post about the congressional Republican retreat in West Virginia and their plan to come out hard in favor of the president's phase-out plan. Tomorrow we'll be talking more about what to expect this coming week. But one of the big things is a wave of confident talk about the likelihood of getting a phase-out bill passed this year. Allen's article contains a lot of that in quotes from congressional Republicans.
And then there's this choice graf ...
The congressional Republicans' confidential plan was developed with the advice of pollsters, marketing experts and communication consultants, and was provided to The Washington Post by a Republican official. The blueprint urges lawmakers to promote the "personalization" of Social Security, suggesting ownership and control, rather than "privatization," which "connotes the total corporate takeover of Social Security." Democratic strategists said they intend to continue fighting the Republican plan by branding it privatization, and assert that depiction is already set in people's minds.
So now it's 'personalization' of Social Security. <$Ad$>It's really hard to find out where the reality ends and the parody starts on this, isn't it?
In any case, I think Allen -- who's been a standout on highlighting the White House's rhetorical flimflam on 'privatization' -- lets us down when he says that the Democrats are going to fight back "by branding [the president's policy] privatization."
How can you brand it with something that is already the established term for it? The term proponents of privatization themselves always chose? It's like branding me 'Josh'.
Here I think even the praiseworthy Allen has stumbled into the always-treacherous minefield of false equivalence, suggesting that both sides are trying to 'brand' the policy with the term most advantageous to their side.
That really doesn't cut it.
Yes, 'privatization' is clearly the term Democrats prefer over the truly moronic 'personalization'. But there is a certain matter of 'is' here. As in, that is the term for it.
'Privatization' is both descriptively appropriate for the policy in question and it has been the accepted term embraced by both sides of the debate for roughly a quarter century.
Both sides may have political motives, but Democrats are resisting Republican efforts to enforce a new Social Security speech code, which the latter are trying to impose because their policy is losing public support. To equate the two distorts what is actually happening.
--Josh Marshall
It's almost like the end of an era: Rep. Harold Ford (D) of Tennessee, former Dean of the Fainthearted Faction, now out of the Fainthearted Faction.
Yes, I'm still trying to get my head around it too ...
On Saturday I discussed the Stolberg piece in the Sunday Times and particularly the passage in which she wrote that Ford is only in favor of add-on accounts, not private accounts carved out of Social Security.
That is a significantly broader statement than the one he released a month ago.
In that statement, he was quite clear that he opposed the Bush plan and that proposed by the Cato Institute. But the wording suggested his opposition was based largely on the price tag (i.e., transition costs) rather than concept of privatization itself. "If she's got the nuance of what he told her right," I wrote, "that's a lot more than he's been willing to say to date."
But it turns out that the normally all-knowing TPM research department let me down on this one, Ford has already said this -- and in an article in which TPM is quoted extensively.
The article comes in a recent edition of The Memphis Flyer.
We've edited the passage down with ellipses to focus in on the key points ...
And Ford in his telephone interview was explicit on the point, denying that he does now, or ever did, advocate tapping payroll taxes to create the accounts ... He maintains that he has been misunderstood. "The only kind of Social Security accounts I've ever advocated was the same thing that Bill Clinton and Al Gore talked about. It's what Gore called 'Social Security Plus' in 2000 and what Clinton called 'universal savings accounts.'" ... And the congressman was quite explicit this week about disavowing not only President Bush's Social Security reform proposals but the concept underlying it. "I have not signed on to any legislation, since I have been in Congress to take money from Social Security to create private accounts. I do not favor privatizing Social Security. I am opposed to President Bush's attempt to do so. Categorically," he said. "The president's plan to privatize Social Security will not accomplish what he says he wants to accomplish. It will add too much debt and it will offset any gains that people would make from their accounts because interest rates would skyrocket and benefits would be reduced and the program would run out of money." ... Ford insists that his own proposals for investment accounts would involve general revenues, not those of the Social Security fund, and could be achieved through progressive tax legislation, overturning the effects of the Bush tax cuts of the last several years.
So there you have it. Rep. Harold Ford (D) of Tennessee, fainthearted no more.
See the newly-updated Faction list here.
--Josh Marshall
I was away for the weekend and had only occasional web access. So I was happy to see when I got in this evening that there was an inevitable follow-up to Friday evening's post about Sen. Evan Bayh's (D) appearance on the Stephanopoulos show. We asked, you'll remember, whether George would pop the question that would get Sen. Bayh out of the Fainthearted Faction.
And, as it turns out, Stephanopoulos is something of a master at the highly-specialized art of Faction extraction. He put the question to Bayh in terms he couldn't duck or talk around. And to Bayh's great credit, he didn't even try. George got not only a clear answer, but a good one.
Here's the relevant passage ...
STEPHANOPOULOS: OK. Let's turn, then, to the president's agenda. In his State of the Union address Wednesday, of course the focus is going to be Iraq and Social Security reform.And a lot of Democrats are wondering where you stand on Social Security reform. You've supported President Bush on his tax cuts. Let me ask you about these Social Security reform proposals, and there are three answers that could be: yes and no (ph).
Number one, would you support diverting the payroll tax into individual accounts?
BAYH: No, I would not, George.
And, look, the president is probably going to talk a lot about ownership and individual choice. I think those are great concepts, and I can support those -- but in addition to the current Social Security system, not as a replacement for it.
Look, you may own your home; a lot of Americans do. I bet you have insurance. Ownership and insurance have to go hand in hand.
Social Security is the insurance. Senior citizens in our country can always rely on it to make sure they're not desperately poor in their old age.
Should we have ownership and choice in addition to that? Yes, we should. But we should never do anything to undermine that insurance. That is one of the bedrock principles of our country.
There was some further discussion of Social Security between the two men. One point Bayh raised was the possibility of a form of 'means testing' at the very high-end of the income scale, though it was framed around the question of whether benefits are indexed to wages or inflation. In any case, the whole exchange pointed clearly to the fact that Bayh just handed in his membership card in the Fainthearted Faction.
See the new updated Faction list here.
--Josh Marshall
As so often is the case out of Iraq, some the best reporting on the Iraqi elections comes from Anthony Shadid in The Washington Post.
Good news has been hard to come by in Iraq for some time. So this unexpectedly high turn-out, relatively low level of violence, and what seems to have been a swelling tide of enthusiasm over the course of the day, is something more than very welcome news. It may also provide some indication or clue to explaining those polls which show, on the one hand, deep-seated Iraqi disenchantment with the US occupation, outrage over the persistent violence that afflicts the country, and yet also an underlying optimism about the future.
Disasters aren't turned around in a day; but this was a good day. Nobody should be surprised that people show up in large numbers in a country where elections have never or only seldom happened; that happens all the time. But I'm not sure I can think of a similar instance when voting has occurred amidst such immediate and credible threats of violence.
The issue now is providing basic security throughout the country and building democratic institutions that will last -- the latter depending on the former.
--Josh Marshall
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