Talk about Fainthearted!
Edward Jones has long been one of the investment house pied pipers of private accounts. Not only were they an original member of the pro-phase-out trade group Alliance for Worker Retirement Security. But in the Wall Street Journal just yesterday, the group's Executive Director, phase-out guru Derrick Max said they were "one of the few firms that has shown some passion for the issue independently of me."
Coming from Max, you've got to expect that was quite a compliment.
It seemed to me that Edward Jones was an odd poster boy for privatization since just last month they were compelled as part of regulatory settlement to disclose that the firm had accepted "$82.4 million in secret payments from seven mutual-fund firms in the first 11 months of 2004 ... that in some cases gave the brokerage firm more compensation for selling poorly performing funds than for selling stellar performers(emphasis added)."
Those words are from an article that appeared in the Wall Street Journal back on January 14th.
However that may be, this week they started pumping a thirty minute pro-Social Security phase-out informercial into their local offices around the country in what the Journal called "rare move by a brokerage house to address the politically charged debate over changes in Social Security with clients as part of a marketing effort."
But then, right as Edward Jones was making its mark among the great pied pipers of private accounts, the AFL-CIO staged a few protests at two of their offices and out of the blue Edward Jones canceled its membership in Max's Alliance for Worker Retirement Security.
Like I said, talk about fainthearted! Maybe we can get these guys together with our man Rep. Allen Boyd and they can compare notes about being wiggly squigglies and folding at the first signs of a fight.
Edward Jones spokesperson Regina DeLuca-Imral claimed, rather limply, that the company had withdrawn from the Alliance "because of the confusion some have expressed about Edward Jones's position on Social Security reform."
These pro-privatization industry groups and astroturf outfits seem to emerge out of the water every year or so and then, as often as not, they die off like salmon after charging home to mate.
Back in 2001, for instance, I wrote an article about an organization called Coalition for American Financial Security, which seemed to spring from the loins of the Frank Russell Company, another one of the industry's pied pipers of private accounts. Their high water mark came in the summer of 2001 when then-Treasury Secretary Paul O'Neill spoke before them thrilling many pro-phase out hearts in the process.
Of course, of all the pied pipers none pipes louder than Charles Schwab.
Schwab himself or some company executive can often be found at the president's economic summits or pro-phase out forums. And as nearly as I can tell they're almost always one of the bigger jobbers in these pro-phase out confabs and clubs. Schwab's chief financial strategist, Liz Ann Sonders, talked up private accounts at the president's summit back in December. (More recently Bush tapped Sonders to be on his new tax reform panel.)
Somehow I doubt Schwab's heart will be as faint as the aforementioned Jones. But I guess only time will tell.
--Josh Marshall
Are Democrats coming down <$NoAd$> with a running bout of rhetorical clarity? I think it may be so.
Sen. Schumer (D) of New York gave the Democrats' radio response today on Social Security. And it's a really good start.
Just one portion ...
Our goal as Democrats is to keep Social Security the way it is, with as few changes as possible, while still making sure it is there for future generations.For this to happen, some changes will need to be made. The question is, what sort of changes?
Does Social Security need fine-tuning, as most Democrats believe? Or does it need to be replaced with something completely different, as the president wants to do?
Just so: "something completely different".
He might almost have said 'phased out and replaced with something ..." But, hey, you can't have everything.
I'm not quite sure I buy into all this calling this, that and the other 'taxes', like the 'birth tax', which he explains. But, hey, let a hundred flowers bloom.
Give it a look. It's a very good start.
--Josh Marshall
I'm not sure Washington's seen someone take on and then take off a new appointment quite so quicky since Bobby Ray Inman.
Just yesterday, as we then informed you, Sen. Tom Carper (D) of Delaware had taken over as the new Dean of the Senate's Fainthearted Faction. His appointment came right after the AP ran an interview with the senator in which he rather conspicuously opened the door to carved-out private accounts a la the Bush plan.
"2nd Senate Democrat warm to private accounts," ran a typical, and to TPM disagreeable, headline for the story.
But it seems that the emphasis of the piece wasn't quite what Carper had intended and that his heart may, at least, not be quite so faint as the AP article suggested.
This afternoon we received the following statement from the senator ...
I've consistently said I would be open to the idea of establishing personal retirement accounts, but not if they result in an increase in our nation's debt nor a reduction in benefits for seniors. From what I understand thus far from the president, his proposal does not meet that crucial test. I believe that our government functions best when both Republicans and Democrats work together to find solutions to common problems, and that's why I believe it would be prudent for Congress and the president to create a truly bipartisan commission, like the one established in 1983, to find a way to strengthen and preserve our Social Security system and increase savings for young and old workers alike.
The AP had quoted Carper saying <$Ad$> that if we opt for private accounts we "should do so in a way that does not significantly increase our federal budget deficit and does not significantly cut benefits for our parents or, frankly, for our kids."
But now he's setting the standard much more sharply: no more debt, no benefit cuts.
Clearly, the senator still wants to remain in the Faction, since he makes clear he's open to a private account carve-out, at least in theory. But his "crucial test", as he now explains it, is one that, in the nature of things, simply can't be met, or would be so improbable as to amount to an impossibility.
I, for instance, am open to buying myself a new Jaguar. As long as someone is willing to sell me one for no more than nine dollars and just as long as Mayor Bloomberg arranges for a private garage at which I can park it.
One might fairly say that my openness to this purchase is a meaningless one, given the qualifications I've imposed. And Carper's "crucial test", while admittedly not quite so improbable as mine, amounts to pretty much the same thing.
In our view, he remains fainthearted for a simple reason: why, but for some ingrained faintheartedness, not simply say he opposes carved-out private accounts when the logic of his stated position points so clearly in that direction?
But with this new information, he seems no more fainthearted than the other two remaining members of the Senate Faction -- Sens. Landrieu and Nelson of Nebraska. So he's not qualified to serve as Dean.
With the office vacant, the Senate Deanship now reverts to that marble monument in the pantheon of Faintheartedness, Rep. Allen Boyd (D) of Florida.
--Josh Marshall
From Sen. Boxer's (D) speech <$NoAd$> yesterday on Social Security ...
So clearly, Social Security is not in crisis, is not bankrupt, and is not collapsing.Yes, there is a challenge we should address.
Have we ever faced a similar Social Security challenge before? Yes. During the Reagan presidency in 1983. Working together, Democrats and Republicans, we resolved the challenge then just as we can do now. So why would an otherwise optimistic George Bush turn into a prophet of pessimism on Social Security?
Because, his initiative is not about meeting the challenges of Social Security to keep it sound; it is not about bringing together Democrats and Republicans as Ronald Reagan did to ensure that full benefits will be there for all Americans. It is about one thing and one thing only: destroying Social Security.
How do I know that? Am I being partisan? Am I being unfair by stating in a very clear way that I believe the true goal here is to destroy Social Security? Not at all. I am simply telling the truth as told by this very White House.
On January 6, 2005, the White House wrote a Social Security memo. Although marked “not for attribution,” fortunately, we have it.
The most telling sentence in the entire memo is this: “For the first time in six decades the Social Security battle is one we can win – and in doing so, we can help transform the political and philosophical landscape of the country.”
Here's the rest. It was delivered at the San Francisco Senior Center.
--Josh Marshall
Both the Times and the Post on Saturday run follow-up pieces on Speaker Denny Hastert's (R) interview in yesterday's Chicago Tribune. The Times piece, by Robin Toner, focuses more on the public disagreement between the Speaker's office and Ken Mehlman at the RNC over how ready the public is for privatization and thus, by implication, how good a job the president has done at selling it.
The Post piece, by Mike Allen, probes what I think is the more telling development.
You'll remember, only a few weeks ago, the House Republicans were telling the president that they wanted him to put forward a specific proposal and then go out and sell it to the public. Only then would they be willing to put their necks on the line to support it. The Senate GOP, or at least key Republican senators, thought differently. They wanted the president to draw back and let them take the lead rather than polarizing the debate by campaigning for it aggressively himself.
Now, as Allen explains, the House GOP has shifted over to the Senate position.
Here is one of the key passages ...
White House and congressional GOP tacticians said yesterday that they now see little chance that Bush will issue a detailed plan for partially privatizing Social Security the way he released specific proposals for tax cuts and other major initiatives.Key leaders including House Ways and Means Committee Chairman Bill Thomas (R-Calif.) and Senate Finance Committee Chairman Charles E. Grassley (R-Iowa) have urged Bush to speak in general terms about altering Social Security and to leave it to Congress to develop specific proposals.
This contrasts with an earlier Capitol Hill strategy of letting the president take the lead -- and take most of the political heat -- in pushing for changes in the politically sensitive Social Security program.
What this means is pretty clear. The House Republicans have seen the Bamboozlepalooza Tour and they don't think it's working. They have to run next year; the president doesn't. And as long as their fate is tied to the Social Security phase-out freight train, they want their hands on the brakes. That gives them control over the tempo and content of the legislative process and the freedom, if and when they want, to simply let the whole thing die.
This development raises a point, which has been lurking in the background through this debate, but has received too little attention. As usual for the president, this battle over Social Security was a war of choice. No one in Congress chose it; he chose it. But once the issue was joined, the White House and the Democrats had a paradoxical commonality of interest in how it would play out.
Let me explain what I mean.
The Democrats didn't choose this fight. It was thrust on them. Because of their core values as a party, the stakes were extraordinarily high. Lose Social Security and the loss is staggering, almost total, given the role it plays in American society. Columnists talk about Roosevelt and legacies and the like. And there's some of that, to be sure, particularly on a sentimental level. But the crux of the matter isn't who created Social Security. It's what the program is and what the Democrats' values are, even if sometimes they need reminding. It's that important.
At the same time, if they could turn back the president's phase-out crusade, the upside would be almost as promising as the downside would be bleak. As it did with health care, a major defeat for a president on privatization could put the policy on ice for years, possibly for the rest of our lifetimes. And the political benefits of defeating the president are too obvious to require explanation.
The White House is in a similar position. If the president could privatize Social Security he would become a truly transformative president, for good or ill. Few presidents get to work on the very architecture of society and state. It's a legacy on steroids.
On the other hand, if the president failed he would have started his second term with his first major political defeat as president and one that came after winning reelection and expanding his majorities in both chambers of congress. It would likely shape the rest of his presidency.
For the White House and the Democrats it's really close to all or nothing, all the chips on the table, with very big upsides and very big downsides.
The odd man out here is the congressional GOP. For them, the calculus is entirely different, particularly in the House.
They've got a good thing going -- seemingly durable majorities, K Street disciplined and incorporated into the DeLay Machine. Sure, many Republicans, all things being equal, believe in privatization. But if it happens it'll be the president's victory, not theirs. It won't expand their majorities or bring them campaign cash they don't already get. A win on this issue, in the most hardboiled terms, is really pretty much a wash. There's just not much in it for them.
Losing, on the other hand, all comes out of their hide. Though a defeated president might be weakened, he'd still be president. Some of them would be out of a job. Their very majorities could be in danger.
A few years ago the congressional Republicans may have had enough ideological fire to yearn for this fight and run the risk. But no more.
These dynamics, I think, shape the structure of the whole debate, the whole contest. And if the Democrats can play it correctly, it's the president's achilles heel.
As we've noted a number of times, the power of an engaged and disciplined presidency, with congressional majorities at hand, is awesome. So this is still far, far from over. But if Allen is right about this change in thinking with the House Republicans, we may have just seen one of the first key shoes drop.
--Josh Marshall
Social Security joke of the evening.
In parliamentary-speak, a 'whip' is a member of the leadership charged with 'whipping' straying members of the party back into line on major votes. The Senate Dems, for instance, have four deputy whips whose job it is to get strayers into line on pivotal issues like, say, Social Security.
Only, in this case, one of the four deputy whips is none other than Sen. Tom Carper of Delaware, Dean of the senate's Fainthearted Faction.
So in addition to getting whipped by Sens. Boxer, Feingold and Nelson of Florida, he now also needs to whip himself.
--Josh Marshall
Sen. Tom Carper (D) of Delaware: "I don't believe that we should rule out the accounts. We have a very low savings rate in this country and clearly need to find ways to stimulate savings, and I think we should be open to a wide range of ideas and not dismiss them out of hand."
Carper is the new Dean of the Senate Fainthearted Faction.
(ed.note: The Senate Deanship was temporarily vacant and held on a contingent basis by Rep. Allen Boyd of Florida, who is fainthearted enough for both chambers. However, Carper has now sufficiently distinguished himself to resume the post.)
--Josh Marshall
Sen. Kent Conrad (D) of North Dakota is going to be on the Stephanopoulos show this weekend. Maybe he can clear up some of those Faintheartedness questions from last month.
--Josh Marshall
I had missed Sen. Dianne Feinstein's (D) opinion piece on Social Security in the San Francisco Chronicle last week. It's worth reading.
--Josh Marshall
Did Rep. Allen Boyd, the Panhandle Poltroon, get the memo?
The Dean of the Fainthearted Faction (Actually through a special motion, Boyd is now Dean of both the House and Senate Factions, because of his profound Faintheartedness) has been telling his constituents that he's for private accounts because it's the only responsible thing to do to make sure Social Security remains solvent for future generations.
"Keeping this vital program intact," he said last week, "for those who depend on it today and in the future, is a commitment I will not ignore."
But yesterday, the cosponsor of his own bill, Rep. Jim Kolbe (R) told the Arizona Republic that "Personal accounts don't solve the problem. I've never argued they solve the problem."
Kolbe went on to tell them that private accounts are essentially a sweetener to get younger workers to go along with big benefit cuts. As Kolbe put it to a hypothetical young worker: "Look, sorry your benefits are going to be cut in the future and you're going to be paying more taxes to support this system, but there is something in it for you."
We were also interested to see that Boyd apparently told the Wall Street Journal that he "opposes big borrowing" to make things right with Social Security. But even Kolbe says their plan costs $600 billion. Actually, $1.1 trillion, but they say they get $500 billion back.
Our man Boyd, always the last to know.
By the way, any progress on getting someone to run against this guy?
--Josh Marshall
Another entry for the Wisdom of Katherine Harris anthology.
This from the AP, Harris talking about President Bush at the Bamboozlepalooza event in Tampa ...
One of those in attendance, Rep. Katherine Harris, R-Fla., quoted the president as saying he recognized the political difficulty involved in tackling such legislation. "He said this is hard.... But he said it's not as hard as sending young men and women off to war," she said.
We've slotted Harris down as FIW in the Conscience Caucus, as if there were ever any question.
--Josh Marshall
Blessed are we that TPM has readers like TPM Reader DP who calls our attention to this hilarious passage in the Hastert interview in the Tribune ...
"You're going to have less money coming in than goes out and indeed, that's a crisis point, that's a problem we have to address," [Hastert] said, calling the program "a Ponzi scheme," but quickly adding that he did not mean it in derogatory way.
Must be hard to have to switch back and forth between Cato-speak and District-speak when it comes to Social Security ...
--Josh Marshall
Rep. Chris Shays (R) of Connecticut is very much in the president's handful on phasing out Social Security. Here's a Charlie Cook article that discusses Diane Farrell and whether she'll decide to challenge Shays again in 2006.
Farrell held Shays to 52% of the vote last November. And as Cook rightly notes, "despite her 2004 loss, Farrell is one of the strongest challengers her party could field in 2006."
Here's Farrell's campaign website from last cycle. And here's her bio.
Financial services industry types notwithstanding, how popular is phase-out in Connecticut? How about in Bridgeport? And in any case, most people who really understand and respect financial markets realize this is a lousy idea anyway. After all, Bob Rubin and John Corzine are both on the right side. And I hear Goldman does some financial services work.
--Josh Marshall
Speaker Denny Hastert (R) of Illinois: "You can't jam change down the American people's throat."
That and more in the Chicago Tribune's interview with Hastert and his discussion of the problems the president is having selling phase-out to congressional Republicans and the American people.
--Josh Marshall
A stumble after a run of good Social Security news articles from the Post.
On A3 today, Michael Fletcher discusses the part of the president's pitch in which he argues that shorter lifespans make Social Security a bad deal or unfair to African-Americans.
Down into the piece Fletcher mentions some of the key critiques of this argument -- the disproportionate benefit African-Americans get from the survivors' and disability portions of Social Security, as well as the program's progressive benefit structure, which also gives a disproportionate benefit to people with low-incomes.
What goes wholly unmentioned is that the way lifespan statistics are used in this argument is inherently misleading.
African-Americans have substantially shorter lifespans than whites -- a fact the president seems concerned about primarily, or perhaps exclusively, as an argument for phasing out Social Security. The argument being that African-Americans don't have as many benefit-collecting years as whites and thus get a worse 'rate of return' on their payroll contributions.
The problem with this argument is that most of the difference in lifespan is tied to death in childhood and early adulthood -- before people have any ability to pay substantial amounts into Social Security and at ages when Social Security survivor benefits are particularly important.
(The issue is discussed in this Paul Krugman column from January 28th.)
This fact receives no mention in the Post article.
--Josh Marshall
Rep. Rick Renzi (R) of Arizona: "We need to know how we can fund it. I'm going to wait and see how we balance the budget and fix Social Security before committing to his plan to create private accounts."
Only just barely; but that gets him into the Conscience Caucus.
--Josh Marshall
The New York Times has one of the first mainstream news pieces I've seen about 'Jeff Gannon' that takes the issue seriously as a hard news story rather than just a 'media story' or a bias piece.
Of particular interest, to me at least, is just how 'Gannon' managed to have access to classified documents relating to the Plame matter. It's not uncommon for journalists to get hold of classified materials. But given the dynamics of that story and how much the White House was gunning for Wilson, it's awfully odd that he would have had this stuff come into his hands for what could at all be called journalistic reasons.
Given all these questions about credentialing and pseudonyms, I'm also curious how 'Gannon' was credentialed at the Republican National Convention, though the RNC certainly has every right to credential whomever they choose, with whatever name they want to go by.
As fate would have it, I sat next to him in the press stands during President Bush's convention speech last September.
I didn't know who he was; he didn't know who I was. And that was probably a good thing all around. (I only found out his story when I looked him up later on the web, after what ended up happening; my recollection is that he gave me his card.) But that didn't stop it from being a surreal experience. Through some sort of double karmic inversion, the women sitting to my left -- 'Gannon', appropriately enough, was on my right ... God not only has a sense of humor, it seems; he is also well-organized -- turned out to be one of the protestors in the hall who lept to her feet mid-speech, tossed on a pink slip and began denouncing the president for about 1.32 seconds before being manhandled out of hall by some security guard who seemed to materialize out of nowhere.
I wrote about it that evening. The 'journalist' mentioned briefly at the end of the post is 'Gannon'.
(ed. note: If you're new to this story, this is the go-to blog.)
--Josh Marshall
Finally, someone sticks up for Rep. Allen Boyd (D) of Florida, Dean of the Fainthearted Faction.
A letter to the editor in today's Tallahassee Democrat ...
Social Security has always been considered the third rail of American politics. This year, President Bush as made it clear that the time has come for an honest, straightforward, and realistic discussion about its future.I commend District 2 Congressman Allen Boyd for his conviction to stand up to those in his own political party and do what is right for the future of Social Security.
Yes, he is a Democrat and I am a Republican and the former chairman of the subcommittee on Social Security in Congress. In politics there is always a temptation to kick the can down the road and hope that problems might disappear. That is not how Congressman Boyd views his job.
He knows that the longer we wait to address the coming crisis, the more difficult and expensive the job will be down the line. So in this new term, along with Boyd's leadership, we will save Social Security for all time, and put it on a path to permanent solvency and stability.
We will need bipartisan commitment in the months ahead. Both parties will be tempted to use Social Security as a political football. Yet, we should all recognize that playing politics with Social Security is playing politics with the future of our children and our grandchildren.
CLAY SHAW
U.S. Rep., R-Fort Lauderdale
Shaw, as it happens, has had a few flirtations with <$NoAd$> the Conscience Caucus.
(ed.note: A note of thanks to TPM reader GA for the catch.)
--Josh Marshall
It's not an official pronouncement exactly. But my friend Ed Kilgore is the policy director of the DLC. And here are his comments about Howard Dean becoming the Chairman of the DNC.
--Josh Marshall
A few days ago I mentioned that an Associated Press story reported that Rep. Heather Wilson (R) of New Mexico opposed President Bush's Social Security privatization plan.
This story, which ran in her district on the 7th simply says: "GOP Rep. Heather Wilson says she's opposed to Bush's plan because she's against investing Social Security taxes in the stock market."
Yet looking at the specific wording of the story and earlier iterations of the same report, I came to the conclusion that Wilson may have bamboozled the reporter in question in an effort to mislead her constituents.
For instance, a more complete version of the AP report, which ran on Sunday, February 6th, reads like this ...
Rep. Heather Wilson, R-N.M., echoed Democrats' opposition to Bush's plan, saying she opposes efforts to invest even a portion of Social Security revenues in private accounts."I don't believe the government should invest Social Security taxes in the stock market," said Wilson, who represents New Mexico's Albuquerque-based 1st Congressional District.
The problem is that this 'government shouldn't invest in the stock market' line is right out of the GOP privatization flimflam playbook. It sounds like opposition to private accounts; but it's not. Privatization supporters don't believe the government should invest in the stock market. They want individuals to do so in their private accounts.
So Wilson, it seemed, was using fingers-crossed, fudging language to bamboozle not only the reporter but her constituents too. And my suspicion in this regard was heightened by the fact that Rep. Wilson's constituent mail on Social Security is filled with the same rhetorical razzmatazz.
The key graf from her constituent mail reads (emphasis added) ...
I have remained firm on my core beliefs about Social Security. There must be no changes in benefits for retirees or near-retirees. That wouldn't be fair to people who need to know that their check will arrive on time and in full. The government should not invest Social Security funds in the stock market. I oppose privatization of our safety net. Payroll taxes should not increase, and we must preserve Social Security disability and survivor's benefits.
Wilson clearly had the playbook open when she (i.e., a staff aide) wrote this email, since to anyone who isn't as obsessed with the Social Security debate as TPM, it sounds like Wilson opposes privatization. And yet, <$NoAd$> given what we've told you recently about the rhetorical gymnastics on this issue, she can say those words and mean she supports carving private investment accounts out of Social Security, i.e., the Bush plan.
In any case, this is where we left things in our last post back on the 6th. So the only thing to do was to call up Wilson's office and find out whether she really was opposing the president's plan or not.
Only that proved a difficult proposition. This week I placed repeated calls to Rep. Wilson's offices in Washington and New Mexico and left voice mails, in Washington and Albuquerque, explaining that I had some follow-up questions about the AP story that placed Wilson in opposition to the president's plan. And yet my calls were never returned. I kept trying. But no luck. Along the way I also placed repeated calls to her Washington spokesman's cell phone. But no luck there either.
I tried the DC office and the cell phone again today with no more success. And then late this afternoon it occurred to me that the problem might be unique to my phone. So I picked up my new New York cell phone and tried one more time.
Bingo.
I finally got Rep. Wilson's spokesman, Joel Hannahs, on the line.
I read Hannahs the following line from this AP story: "GOP Rep. Heather Wilson says she's opposed to Bush's plan because she's against investing Social Security taxes in the stock market." And I asked what it was about the president's plan she opposed.
Hannahs replied that he would "let her words speak for themselves."
I then pointed out that they weren't her words. This was the AP describing her stance. And I was trying to find out whether it was an accurate description.
Does she oppose the president's plan?
Hannahs then told me: "I don't have any comment."
As you might imagine, from that point, the call came to a rather rapid conclusion.
Now, given Hannahs' reticence about disclosing Rep. Wilson's position on this issue, it's still hard for me to say definitively that she's bamboozling her constituents about her position, since her position seems to be a secret. But now I'm awfully suspicious. (Consider that Wilson's office has apparently made no effort to correct the AP story if it is in error.) And my phone exchange with Hannahs makes me think my suspicions are very well founded.
--Josh Marshall
The Center for American Progress has just released a new study detailing one of the more technical but also very real problems with the president's plan.
Regardless of what rate of return one estimates for private accounts over the longterm, in the real world, the rate of return is not a straight line. There are long bull markets, long bear markets, as well as sudden shifts in the stock market in one direction or another.
"While the real rate of return of the stock market has averaged 6.6 percent over the past 100 years," the study notes, "its average rate of return over 35-year periods has fluctuated between 3 percent and 10 percent." That of course does not take into account that you specifically have to cash out at a specific time, i.e., when you retire, and that could come in a trough.
(I say you're forced to do so because under the president's plan you have to use your account to purchase an annuity when you retire.)
What all of this boils down to, of course, is that whatever the average rates of return over time, some folks will do a lot better than others. Some will end up doing poorly enough that they simply won't have enough to support themselves in retirement. And there will be immense -- probably irresistible -- political pressure to at least bring those folks up to the survival level, if not up to a generous benefit. Needless to say, the government isn't going to be able to take the high earnings of the lucky folks to make up for the shortfall of the unlucky folks. So where does the money come from? It's another cost of the whole plan -- though not one it's proponents will make any mention of. Those costs are treated in this study. And the author of the study says they'll amount to another "$600 billion and $900 billion in present value terms to the costs of privatization over the next 75 years."
One other point: Above I used the terms 'lucky' and 'unlucky'. In normal private investing we recognize a substantial element of chance and unknowables. But we don't consider the whole matter an issue of luck or no luck since people make decisions about how much risk they're willing to shoulder, where they want to invest, which companies they think are winners and which aren't, and when they choose to cash out. But as the president's plans have emerged, it's become clear that the range of options you will have is quite limited, as is what you can do with it when you retire. And that means that whether you end up in one of the lucky 'cohorts' or the unlucky ones depends overwhelmingly on what year you were born in.
So using the language of 'luck' applies even more than usual.
Of course, this whole discussion of how you even out the peaks and troughs in market cycles for individual persons and separate generational cohorts only gets us back to why it makes sense to have the element of risk borne not by the individual or groups of people born in the same year, but by society as a whole. And that's what we have now with Social Security.
--Josh Marshall
More on the Social Security politics in Conscience Caucus member Rep. Ginney Brown-Waite's 5th District down in Florida.
--Josh Marshall
"Statement of Jo Anne <$NoAd$> Barnhart"
Commissioner of Social Security
January 28, 2005
“There has been a lot of misinformation lately and I am glad to have this opportunity to set the record straight.“I have never, nor will I ever, ask or direct Social Security employees to promote or advance any specific proposal for Social Security reform. Our job at Social Security is to provide services and benefits and to educate the American public about the programs and finances of Social Security.
“The role the Social Security Administration plays in educating the public, as well as the messages we are using, have not changed in the past decade.”
"Background Information on Conversation Participants"
White House Fact-Sheet Released for Presidential Social Security Event in Raleigh, North Carolina
February 10th, 2005
"Andrew Biggs, Associate Commissioner for Retirement Policy, Social Security Administration (Washington, D.C.)""Andrew was appointed to the Social Security Administration (SSA) in 2003. Before joining SSA, he served as a staff member for the House Committee on Banking and Financial Services, a Social Security analyst at the Cato Institute, and a staff member on the Commission to Strengthen Social Security. He holds a Bachelor’s degree from The Queen’s University of Belfast, Northern Ireland, a Master’s from Cambridge University, and a Ph.D. from the London School of Economics and Political Science."
--Josh Marshall
Senate Dems: "A Privatized Account that Earns the CBO-Projected Rate of Return Would Have its Entire Value Eliminated By the Privatization Tax." See the rest.
--Josh Marshall
The White House fact-sheet on the "participants" in the North Carolina Bamboozlepalooza event <$NoAd$>...
BACKGROUND INFORMATION ON CONVERSATION PARTICIPANTSAndrew Biggs, Associate Commissioner for Retirement Policy, Social Security Administration (Washington, D.C.)
Andrew was appointed to the Social Security Administration (SSA) in 2003. Before joining SSA, he served as a staff member for the House Committee on Banking and Financial Services, a Social Security analyst at the Cato Institute, and a staff member on the Commission to Strengthen Social Security. He holds a Bachelor’s degree from The Queen’s University of Belfast, Northern Ireland, a Master’s from Cambridge University, and a Ph.D. from the London School of Economics and Political Science.
Dawn Baldwin, Teacher, Lenoir Community College (Merritt, North Carolina)
Dawn teaches English at Lenoir Community College in Kinston, North Carolina. She recently purchased her first home in October 2004 and will move into her new home in the next four to six weeks when construction is complete. Dawn has a 401(k) plan through Lenoir Community College and is looking to open an IRA, but Social Security will play an important role in her retirement. Dawn is concerned about the future of Social Security for herself and her son. She says that personal retirement accounts would make her feel as if she had an important role in her own retirement. She wants Social Security reform to happen sooner rather than later so that her son can rely on Social Security.
Noel Council, Retired Senior (Raleigh, North Carolina)
Noel worked as a senior designer for IBM in Raleigh for over 31 years. His wife, Ruth, is a retired nurse. Noel’s retirement income is comprised of his pension from IBM – a tax-deferred savings plan that he started at IBM and now is managed by Merrill Lynch – and Social Security. He says that Social Security is an important part of his retirement income. Noel would like to see his children and grandchildren receive the benefits of Social Security that he and Ruth have seen. He likes the idea of personal retirement accounts because they give the individual more control and ownership.
Cyndi Godfrey, Corporate Communications Manager, Godfrey Lumber Company, Inc.
(Statesville, North Carolina)
Cyndi’s husband, William, and his three brothers own and operate a third-generation lumber company, Godfrey Lumber Company, Inc., which was started by the brothers’ father. Godfrey Lumber has approximately 80 employees. Cyndi works in Corporate Communications at Godfrey Lumber. Cyndi and William are planning for their retirement through their Roth IRAs and a profit-sharing plan. They would like to do more personal investing in preparation for their retirement because they are uncertain of the future of Social Security. Cyndi likes the idea of personal retirement accounts because she feels that they would put her in the driver’s seat when planning her own retirement. She also believes that personal retirement accounts would be beneficial to her employees because they would be part of a system that is updated for this generation.
Matthew “Skip” Long, President and CEO, National Jobs Partnership (Raleigh, North Carolina)
Skip is the President and CEO of National Jobs Partnership, a company that equips churches and faith-based organizations to provide job training and support enabling individuals to secure meaningful employment. He is a former associate pastor at Raleigh Mennonite Church. He is on the leadership team of Christ Our King Community Church in Raleigh. Skip says that ownership is very important to minority communities, and personal retirement accounts would put the individual in control of his or her own retirement. He says that this empowerment regains hope in people’s lives. He also likes that a personal retirement account could be left for future generations because when both of his parents passed away, the money that had been put into Social Security through all their years of work just disappeared. He says that it is important to him to be able to leave a legacy for his children.
Participant #1 is interesting ...
--Josh Marshall
You won't want to miss the Al Franken Show today. There'll be a special announcement. Why not him, indeed.
--Josh Marshall
For those questions to Chairman Greenspan we talked about Wednesday evening, some helpful documentation ...
First the president's view: "The money -- payroll taxes going into the Social Security are spent. They're spent on benefits and they're spent on government programs. There is no trust."
Second, the Greenspan Commission's view: "The National Commission believes that the investment procedures followed by the trust funds in the past generally have been proper and appropriate. The monies available have generally been invested appropriately in Government obligations at interest rates which are equitable to both the trust funds and the General Fund of the Treasury and have not -- as is sometimes alleged -- been spent for other purposes outside of the Social Security program."
And another interesting passage: "The National Commission believes that changes in the Social Security program should be made only for programmatic reasons, and not for purposes of balancing the budget."
(ed.note: Special thanks to reader DS.)
--Josh Marshall
The Arch-Privatizer Pat Toomey and his Club for Growth in the market for a Capitol Hill lobbyist, reports The Hill.
--Josh Marshall
A quick look at some polling data gives a clear idea of why the Fainthearted Faction keeps shrinking and the Conscience Caucus keeps getting bigger.
Start with the most recent Gallup poll just out on Wednesday and go to the most basic question: Private accounts good idea or bad idea?
55% say bad idea; 40% say good idea. They asked the same question a month ago and the numbers were identical. 17% of the public believes that there is a Social Security 'crisis'. (55% say 'major problems' and 23% 'minor problems'.)
When asked about other steps that might be taken to shore up the system, benefit cuts for people under 55 -- which is part of the Bush plan -- are 29% for, 67% against. Raising, or actually doing away with the cap on payroll taxes, gets 67% for, 30% against, something the White House appears to have ruled out.
(Note: The White House has categorically ruled out 'raising payroll taxes'. But there has been at least a bit of ambiguity about whether they would consider raising the cap 'raising taxes' or if that only applies to rates.)
Down the line the numbers are not good for the president or the supporters of phasing out Social Security. Not terrible, mind you, but in the negative on almost every count.
What makes those numbers more telling is that, as near as I can tell, the Gallup questionnaire did not include the one follow-up question that consistently sends support for privatization plummeting -- namely, transition costs and trillions of dollars of borrowing.
For example, in the Washington Post/ABC poll from December 22nd, the initial query on private accounts yielded a respectable 53% level of support. But when they followed up and asked people whether they would support it if the transition costs might reach as high as $2 trillion, support dropped to about 25%, with 69% against.
To say that the bottom dropped out of support for private accounts would, I think, be a fair characterization of that shift.
This dynamic is underscored by a new article of poll analysis out Thursday from the Post. It's an important article painting a complex picture of public attitudes, with potential avenues of advantage for both sides. But one point that comes through clearly is that supporters of the president's plan tend to drop their support in the face of objections much more readily than the president's opponents are swayed by his arguments.
The key passage from the article reads ...
That [transition] cost estimate proved to be the most effective of four arguments against Bush's proposal tested in the polls. While 56 percent said they support a plan for individual investment accounts, more than half of those said they would be less likely to do so after hearing the estimate. More than four in 10 supporters wavered when they heard that personal accounts would not, by themselves, reduce the financial problems facing Social Security.Those opposed to Bush's plan were consistently more resistant to changing their view -- about one in four did -- when confronted with four arguments supporting his proposal.
In other words, support drops dramatically when supporters are pressed with even the most elemntary and indisputable problems with the president's approach. I say 'indisputable' because White House itself has conceded that private accounts won't assure the solvency of Social Security. One might have made that question far sharper by noting that private accounts will actually accelerate the onset of the programs financial problems. On the other hand, people who are opposed tend to remain opposed or, in the not altogether flattering wording of the article, show themselves "consistently more resistant to changing their view."
One might say this is a pretty fair characterization of the disunity and wavering today among congressional Republicans and the unity of the Democrats.
--Josh Marshall
Following up on our earlier posts about the president's apparent desire to default on the US Treasury notes held by the Social Security Administration, two points ...
First, most of President Bush's personal wealth appears to be tied up in bonds. Do his get honored? Or is he out of luck too?
Second, what the president said today almost certainly violates his oath of office in which he swears to "preserve, protect, and defend the Constitution of the United States."
That would be the Constitution which reads (Am.XIV, Section 4): "The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned."
--Josh Marshall
Let's ask Alan.
We and many others had predicted that the president's angle here was to default on the Treasury bonds sitting in the Social Security Trust Fund. And now we can be pretty confident that he plans to do just that since today he said that the Trust Fund doesn't even exist.
Now, here's the thing.
Alan Greenspan headed up the 'Greenspan Commission' (aka the National Commission on Social Security Reform). The Greenspan Commission didn't create the Trust Fund -- it dates back to 1939. But it was the reform package devised by the Greenspan Commission and issued in their January 1983 report that led to the intentional building up of a large surplus in the Trust Fund which would provide excess revenue to help pay for the retirement of the babyboomers in the early decades of the 21st century.
Setting aside all the actuarial and financial gobbledegook, the basic idea was that the boomers and others would start paying not only their own taxes but also advance paying to cover the costs of their own retirement. The Social Security Adminsitration used the monies in the Trust Fund to purchase bonds -- debt that otherwise would have had to have been purchased by private individuals, pensions, foreigners, all the parties that buy US Treasury bonds. (The majority of the US government's debt is in the hands of those folks; and you can be sure they're going to get paid back.)
So if you've paid Social Security taxes in any of the years from 1983 until today, you've been advance paying. And now President Bush just said that that money is gone. So, you thought you were advance paying to cover part of the future expenses of your generation's retirement. But it seems you were just a sucker since President Bush is now saying the money ain't gonna be paid back. You're just fresh outta luck, you could say.
So here's our question: Does Alan Greenspan think there's a Trust Fund? Does he believe those bonds are backed up by the full faith and credit of the United States government? Does he think they will and should be paid back? If he doesn't, he's got a hell of a lot of explaining to do since it was under his guidance that we came up with this whole idea.
Or how about Sen. Bob Dole? He was on the Commission too. What does he think? Does he agree? Or the recently-retired House Ways and Means Chairman Bill Archer (R). He was on it too.
Let's ask all of them ...
--Josh Marshall
President Bush lays the groundwork for defaulting on almost two trillion dollars worth of <$NoAd$> US Treasury bonds, from today at the Commerce Department ...
Some in our country think that Social Security is a trust fund -- in other words, there's a pile of money being accumulated. That's just simply not true. The money -- payroll taxes going into the Social Security are spent. They're spent on benefits and they're spent on government programs. There is no trust. We're on the ultimate pay-as-you-go system -- what goes in comes out. And so, starting in 2018, what's going in -- what's coming out is greater than what's going in. It says we've got a problem. And we'd better start dealing with it now. The longer we wait, the harder it is to fix the problem.
It's what they're after. Just watch.
--Josh Marshall
Finally, finally, finally, FINALLY!
Finally, a major publication -- on its newspages -- has taken up one of the key dishonesties (I was going to say the biggest, but there are so many ...) in President Bush's argument for phasing out Social Security.
As we've discussed here many times, President Bush's gloomy predictions about the demise of Social Security are premised on a 21st century of anemic economic growth while his claims for private accounts are based on a 21st century of robust economic growth.
As Jonathan Weisman and Ben White put it today on E1 in the Post: "To conclude that Social Security is careening toward a crisis in 2042, President Bush is relying on projections that an aging society will drag down economic growth. Yet his proposal to establish personal accounts is counting on strong investment gains in financial markets that would be coping with the same demographic head wind."
--Josh Marshall
Rep. Slaughter (D) of New York calls on the president to explain why a phony 'reporter' from 'Talon News' got accredited at the White House for the apparent purpose of teeing up softball questions for McClellan and the president.
Meanwhile, an eagle-eyed poster at Dailykos asks why this fellow also seems to have been leaked a CIA memo about Valerie Plame.
She references this passage from a December 26th, 23 piece in the Washington Post: "On Oct. 28, Talon News, a news company tied to a group called GOP USA,posted on the Internet an interview with Wilson in which the Talon News questioner asks: 'An internal government memo prepared by U.S. intelligence personnel details a meeting in early 2002 where your wife, a member of the agency for clandestine service working on Iraqi weapons issues, suggested that you could be sent to investigate the reports. Do you dispute that?'"
--Josh Marshall
Conscience Caucus member Rep. McCrery (R) of Louisiana chooses shoulder socket over Social Security!
From CQ Today ...
The White House's lobbying effort on behalf of its Social Security overhaul has already yielded results: A key House subcommittee chairman said Wednesday he has been persuaded to push for Bush's plan.Jim McCrery, R-La., the chairman of the House Ways and Means Subcommittee on Social Security, said the director of the White House National Economic Council, Allan B. Hubbard, sold him on the president's approach in a private meeting on Tuesday.
...
"I'm convinced the president's approach is worth pursuing in the legislative process," McCrery said. "Frankly, I had not thought of the policy rationale they described yesterday."
It's awfully encouraging that the Chairman of the Social Security Subcommittee hadn't realized what the rationale was for the president's <$NoAd$> policy.
Chairman Thomas, you gotta be next, buddy ...
--Josh Marshall
Reuters discusses AARP's plan to strengthen Social Security by raising the payroll tax cap to $140,000, which they say would reduce the long-term shortfall by 43%. They also support having the SSA invest part of the Trust Fund in what I take to be an index fund, which they say would handle another 15%.
This is the plan Conscience Caucus member Rep. Ginny Brown-Waite (R) of Florida is excited about.
(ed.note: As we discussed on Saturday, while phase-out supporters will seek to confuse the issue, having the Trust Fund invest some money in private securities is entirely different from phase-out with private accounts. Whether it's a good idea or not is a complicated question, but it is entirely different from private accounts. For more, see the post.)
--Josh Marshall
We get letters like this about Senator Chafee (R) of Rhode Island almost every day ...
Josh,I have been trying to get a straight answer out of Lincoln Chafee's office for months on where he stands on Social Security. I have gotten nothing from them. I have written two letters. No response. I called his office and was promised a callback, but heard nothing from them. As far as I am concerned, Chafee refuses to give an answer on where he stands on Social Security. I have corresponded with Senator Chafee many times in the past. I have always received a quick and relatively straightforward response, so I can only assume that his refusal to answer is intentional.
Would I vote for Senator Chafee's re-election? No. I would not vote for anyone who will not unequivocally stand up for Social Security. Combine that with his vote to confirm Alberto Gonzales, which to my mind is a vote in favor of torture, and I simply cannot support him. I will be strongly supporting Matt Brown's (likely) run for Senate.
We also get letters like this one ...
Dear Josh-Thank you for everything you are doing to shatter and dispel the falsehoods coming out of the administration about Social Security. I'm a 53 year old who began working at age 16. My mom, widowed at age 36 with 3 young kids, brought us up to believe that in America, you could strive toward your dreams and carve out your own future. She returned to work, of course, but could not have kept our family together without the benefits she received from Social Security and my Dad's veteran's benefits - he was a U.S. Marine who fought on the beaches of Iwo Jima.
I chose a path that allowed me independence in my life. I've been an independent contractor in my profession throughout my career, as has my husband. We pay our own health insurance premiums (currently $967 / month Oxford Health Plans, dig that!) make yearly contributions to our own IRA's, own our house, pay our taxes, and willingly pay our SSA contributions.
Mr. Bush wants to denigrate the service and the sacrifices of my father and my mother by saying their children don't deserve to have the social contract America made with us honored. I know deeply and personally how life can change in an instant, and if anyone wants to talk to me about it, I'll be glad to give them my two cents.
We are facing a galvanizing moment in America as we decide if we are to be a country that understands and lives the humanistic concept of being one's brother's keeper, or if we decide instead to adopt a ruthless, me first, sink or swim approach to dealing with our citizenry.
I pray with all my heart we choose the former.
Me <$NoAd$> too.
--Josh Marshall
Hmmm. Judith Miller assigned to cover the UN corruption beat for the Times. Need we say the obvious?
--Josh Marshall
TPM reader TS writes in with a great idea. With President Bush bringing the Bamboozlepalooza Tour to Philly tomorrow, it seems like a great opportunity for Gov. Rendell to take himself out of the Fainthearted Faction. Yes, Dems who aren't even in Congress can get special Associate Membership in the Faction for particularly gratuitous examples of Faintheartedness. And Gov. Rendell is one of two who has it.
--Josh Marshall
One of the most misleading comparisons President Bush made in his State of the Union address came when he compared private accounts carved out of Social Security to the Thrift Savings Plan available to employees of the federal government.
Now George Will has picked up the cudgel, combining this bogus comparison with the now de rigueur demonization of Sen. Harry Reid, who scares Republicans.
In his final flourish Will writes ...
Begun in 1987, the Thrift Savings Plan, which as of December 2004 had assets of $152 billion, is a retirement-savings plan open to all civilian federal employees, including senators, and all members of the uniformed services.They can invest as much as 14 percent of their salaries in one of five retirement funds. Consider the rate of return of C Fund, one of the five. It is a common-stock fund, so it should represent the risks that Reid thinks should terrify Americans:
In only four of 17 years has the rate of return been negative. But in 11 years the rate has been greater than 10 percent, in eight years it has been greater than 20 percent, in four years it has been greater than 30 percent. The compound annual rate of return for the last 10 years has been 12 percent, and the return over the 17 years has been 12.1 percent.
Reid participates in the plan, but opposes allowing all Americans the comparable opportunity that Bush is proposing. But if the numbers just cited are the result of roulette, the legislators should let the rest of us into the game in which they are prospering.
Who will make the obvious point?
No federal employees put their Social Security funds into the TSP. The TSP is in addition to Social Security. To the extent that there is an analogy to anything it is to an add-on account -- the kind Democrats support and <$Ad$> Republicans oppose. Indeed, the TSP is little different from private sector 401ks, a defined-contribution retirement plan.
Indeed, no less an authority than the Social Security Administration says: "The TSP is a defined contribution plan similar to the 401K plans offered in the private sector. Contributions are made by payroll deduction. Both the money that is contributed and the interest earned are tax-deferred."
Let's give Will the benefit of the doubt and assume he's just ignorant rather than intentionally misleading. Democrats don't think people shouldn't invest in private securities as part of their retirement planning. What they say is that that should be in addition to Social Security, from which workers get a flat guarantee of a base level of retirement income.
The question isn't why everyone shouldn't have the chance to get in on the Thrift Savings Plan. The question is why everyday Americans should have to choose between Social Security and the TSP when federal employees now get to have both.
The point is simple and no more complicated than the elementary concept of diversification in an investment portfolio. Ideally, retirement planning should include multiple sources of income: the guaranteed, threshold level of income provided by Social Security, private savings and an employer-based pension. Each has different levels of risk involved. One key importance of Social Security in this mix is that it is the one part of the equation in which there is a flat, no-matter-what guarantee.
And as long as we're on to this issue of the guarantee behind Social Security, consider this.
In a fact-sheet distributed by the White House last week, the president's budgeteers argued that by diverting 1/3 of his or her payroll taxes into a private account, a worker would forgo 1/3 of their guaranteed benefit from Social Security.
But in a policy memo making the rounds in Washington, Jason Furman argues that this is incorrect. For workers who live their whole careers in the president's private account system -- which would start with kids born in 1990 -- diverting 1/3 of their payroll taxes would result in forgoing 2/3 of their guaranteed benefit.
As Furman writes: "Under the President’s plan the worker would have to give up about two-thirds of future government benefits and be entitled to receive about $5,000 annually from the traditional system – that is only enough to replace 8 percent of one’s pre-retirement income."
We've just added the Furman memo to the TPM Document Collection. So you can read it yourself.
--Josh Marshall
AP: "When Rep. Rob Simmons walked into the White House Tuesday, he was ready to defend his opposition to the president's proposed overhaul of the country's Social Security system. So in the meeting, Simmons, R-Conn., handed President Bush a copy of an opinion piece he wrote, opposing any effort to divert Social Security dollars into personal accounts _ a provision Bush has advocated."
Rep. Simmons of Connecticut just keeps getting Louder and Prouder.
On the other hand, Rep. Chris Shays seems to be a big supporter of replacing Social Security with 401ks-like private accounts.
--Josh Marshall
I don't normally list members of Congress by their hometown. But I did yesterday with House Conscience Caucus Dean Rep. Jo Ann Emerson of Missouri. And for good reason -- because she represents Cape Girardeau, Missouri, hometown of our good friend Rush Limbaugh.
So we do have to ask. Who's more in touch with folks in the 8th District? Jo Ann or Rush?
--Josh Marshall
Social Security scare-talk vocabulary enters baroque phase! Treasury Secretary Snow says the program is "doomed."
--Josh Marshall
Talk about burying the lede!
If I'm understanding the US News squib correctly, the Luntz memo not only says that Brian Williams is an easy mark. Luntz apparently also believes that CNN is now so thoroughly whipped as to be on par with FOX in terms of Bush-fidelity.
[ed.note: I have to thank this blog for setting me straight on this egregious error.]
--Josh Marshall
If you're a supporter of Social Security phase-out, then by all means get over to the Club for Growth website and give these guys some money. Because it's not at all clear they can afford, at present, to run ads against all the Republicans going into the Conscience Caucus.
(ed.note: For those of you who are not familiar with them, the Club for Growth is a public interest group that advocates on behalf of the extremely wealthy.)
--Josh Marshall
I have to tell you I'm a little concerned about some members of the Conscience Caucus and more than a few folks who are trying to get in.
Let's just start with Sen. Linc Chafee (R) of Rhode Island.
First, he's against Social Security phase-out; then maybe he's for it; then he can't make up his mind. Tomorrow who knows? Doesn't this sort of felonious flipfloppery and indecision start to have a corrosive effect on one's chances for reelection?
Better to be in the Caucus than out of it, certainly. And Chafee's still hanging on, if in CUP? status. But Reps. Simmons and Emerson seemed to know they were against phase-out from the get-go.
I know everyone's got to dance once in a while. But once phase-out goes down in flames isn't this the sort of thing Jim Langevin (D-RI) is going to use to clobber Chafee?
--Josh Marshall
A TPM Reader points out this final line in the Free Press's piece on the president's visit to Michigan: "Detroit Economic Club officials said Monday the traditional question and answer period after the speech has been dropped for Bush's visit."
--Josh Marshall
Bamboozlepalooza Tour schedules new dates for North Carolina! But NC has no Democratic senators. Who's the Democratic beard for this trip?
--Josh Marshall
Noam Scheiber catches David Brooks in the act, trying to find the back door to phase-out now that the front door approach may be blocked.
--Josh Marshall
A TPM reader -- SS -- makes a great point. Can we keep this Bamboozlepalooza Tour going?
In Michigan, where the president is today, almost half the Republicans in the congressional delegation are in the Caucus or bucking for entry. Can the president plan a trip to, maybe, Alabama, another hotbed of Caucusism. Or maybe Missouri? Heck, why not Texas? I'd be happy to work up an itinerary.
Late Update: Come to think of it: Ohio.
--Josh Marshall
According to a new media advisory "Senators Olympia Snowe (R-ME) and Joe Lieberman (D-CT), Co-Chairs of the Senate Centrist Coalition, will convene a meeting of the coalition" this afternoon on the Hill. They'll get a briefing from "Maya MacGuineas of New America Foundation [a sensible privatization advocate], Peter Orszag of Brookings Institution [a sensible Social Security advocate] and David John of the Heritage Foundation [an insensible privatization advocate]... on fiscal matters, including budget deficits and Social Security."
Just in case anyone's wondering, reinstatement in the Faction can happen in the flash of an eye.
--Josh Marshall
Frank? Frank Luntz? Calling Frank Luntz? It seems President Bush needs a refresher course in how not to use pejorative terms to describe his own policy.
--Josh Marshall
Hope is the most fleeting of commodities on the bloody and inter-mingled border between Israel and the future Palestinian state. But today, there is at least more than a little of it.
--Josh Marshall
Allen Raymond gets five months for his role in the New Hampshire phone-jamming scandal. We also hear something's bubbling on the Tobin front.
--Josh Marshall
Someday it'll probably be like the AMEX commercial: Conscience Caucus member since January '05.
In any case, before we get to that point, some of the early-adopters are certainly trying to make clear that they've been in the Caucus longer than all these Johnny-Come-Latelies. Today, in The Day of New London, Connecticut, early Caucus member Rep. Rob Simmons (R) reaffirms his Caucus membership and Loud and Proud status.
Rob Simmons, in the Caucus before it was cool.
And right as Rob Simmons is digging in his heels and making sure everyone knows he was a Caucus man from way back, there's Sen. Arlen Specter, first member of the senate Caucus, goin' all wobbly.
Here's Specter from an interview published today by the Washington Times ...
Q. Do you agree with the president's plan for changing Social Security?A. I'm waiting for a specifiation and the details. I have an open mind on it. I'm not going to give the president a blank check, nor am I going to line up with the people who say they're unalterably opposed. I'm against cutting Social Security benefits. I'm against borrowing extensively. But I want to see what the presient has in mind.
Q. Do you support private accounts?
A. I'm prepared to listen.
Q. You sound skeptical.
A. Well, I'm prepared to listen to see how they would be done. How will they be financed? How much money will it take out of the system? We pretty much a pay-as-you-go program, paying out as the contributions are made. How will it work? People are talking about gigantic borrowing. I'm not for that.
Prepared to listen? That chairmanship must be feelin' pretty good, I guess. Or is it Pat Toomey clawing back from the political netherworld?
Because that's sure not what Arlen told his constituents just four weeks ago.
As we reported on January 6th of this year, in his constituent mail sent out on the Social Security issue, Specter told Pennsylvanians ...
On the issue of privatization, I had some time ago considered an idea to place a relatively small portion of benefits in an investment account, providing that the “security” aspect of Social Security was retained and the investment was under professional management. However, with the severe fluctuations of the stock market, I have since rejected that idea.
Considered, rejected, prepared to listen. I just can't keep up.
--Josh Marshall
Back in the day (you remember the day, right?) every time a president came forward with a budget, reporters would pore over the thing. And any line item or provision or assumption that wasn't based on the most rock-solid accounting or didn't take into account the most pessimistic prognosication was instantly given that most infamous of DC budgeting sobriquets: the dreaded "smoke and mirrors."
Nowadays I guess you could say things have changed. How else can it be when an OMB Director can simply state that borrowing a trillion dollars doesn't count as new debt?
"Transition financing does not represent new debt," OMB chief Josh Bolten said yesterday.
And while we're at it, it would be stingy not to recognize that the White House has now given new meaning to phrase 'unified budgeting'. In the Bush White House lexicon that would refer to a budget that included not only the president's 'budget' but also his major new spending proposals.
--Josh Marshall
Let me share with you one of the problems I've been having handling admissions policy for the Conscience Caucus.
Human nature being what it is, the Caucus is like any other club. As the Caucus gets more popular, the admissions policies have grown tighter, more restrictive.
So, for instance, back in the early days of the Caucus, freshman Rep. Dave Reichert (R) of Washington got in merely for telling the Tri-City Herald that "he was intrigued by the idea of personal accounts, but was reluctant to add to the federal deficit." Nowadays, a little aside like that would hardly get you past the first interview. And Reichert's status in the Caucus is actually currently under review since, as near as we can tell, he's been mum on Social Security phase-out ever since.
But this tighter criteria does leave part of the story untold. As we've been reviewing the coverage over the last few days, it is striking just how few Republican senators are willing to go on the record in support of the president's plan. I'm not saying they're opposing it or that they won't sign on soon enough. But the resistance to simply saying, "Yes, I support the president's plan" is pretty telling.
Here's one example.
Of the states on the Bamboozlepalooza tour, there were three Republican senators: Burns of Montana, Hagel of Nebraska and Martinez of Florida.
As far as I can tell not one of them was willing to say they support he president's plan.
When the president was in Montana, Burns said he would "continue to look at it" but still had more questions, particularly about how to pay for it. After Burns got done introducing Bush at the event and a Times reporter asked if he supported the plan, he said he was still "crunching numbers." To yet another reporter, Burns said he was "intrigued" by the president's plan, but not ready to sign on. "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."
Hagel told the Christian Science Monitor that while he supported private accounts in principle, he wasn't ready to sign on with the president's plan. The key graf ...
"There's no question this is a tough sell," said Senator Hagel, who is preparing to unveil his own plan for Social Security in the next few weeks. "Social Security has probably been the most successful, important program we've had in government. Everyone is touched; there should be questions." He expressed doubt over whether a bill could be passed this year. "Next year is OK," he said.
Then there's freshman Senator Mel Martinez of Florida. This is what the Palm Beach Post had to say about Martinez at the Bamboozlepalooza tour's stop in Tampa: "One hint of the difficulty Bush is facing came from U.S. Sen. Mel Martinez, R-Fla., who was applauded by Bush for his support of the president's proposal. But after the event, Martinez said he supports private accounts but needs more detail before he can make a final decision."
Of the three, I'd say Burns (improbably enough) is the only one who's even possibly Caucus material, having read all the different coverage of each of the three over the last week. But just how many Republican senators are there who are willing to say now that they support the president's plan? It's hard to say, not least because many have managed to slip through without saying anything at all. Without having done any sort of organized count, but having looked at comments from a number of them over the past few days, I would not be surprised at all if less than half the Republican caucus is willing now to declare their support for the president's plan.
--Josh Marshall
Perhaps these numbers have already been run (I suspect they have somewhere), in which case I'd appreciate if someone could point me in the right direction. Otherwise, can some economist or reliable number-cruncher crunch forth and figure out what percentage of the population would be required to use more than 80% of their private account 'nest-egg' to purchase an annuity.
Come to think of it, that approach only makes sense if the president were proposing 100% phase-out rather than 30%. And that probably won't be sprung on the public for several more years. So given the fact that the benefit-cut-clawback that goes along with your private account would probably bring monthly payments for many below the poverty line, can someone put together some reasonably concrete numbers on what percentage of private account holders will never really get their hands on the thing because they'll be forced to spend the whole thing, or the lion's share of it, on an annuity?
Later we can get into what a bad deal most annuities are supposed to be.
--Josh Marshall
Detroit Free Press: "A survey of Michigan's congressional delegation shows that at least four of nine Republicans in the U.S. House are withholding endorsement of Bush's proposed personal accounts that would allow taxpayers to invest up to 4 percent of their payroll taxes that now go toward social security."
And apparently one of those four, Rep. Thaddeus McCotter is in the Caucus and Loud and Proud. Says the Free Press: "Opposes Bush's plan of diverting payroll taxes into personal accounts. That plan takes money from the payroll tax, which normally goes to the Social Security trust fund and diverts it to personal accounts for investment. The Social Security pot would shrink, McCotter says."
Late Update: The other three Republicans in the Michigan House delegations are Rep. Candice Miller, Rep. Mike Rogers and Rep. Joe Schwarz. Schwarz is already in the Caucus. But from the descriptions given here in the Free Press run-down it's not yet clear that Miller and Rogers are fully Caucus-worthy. Like we said, the standards for admission are getting tighter! Otherwise we'd end up with most of the House Republicans in there. If you've seen statements by Miller and Rogers which make them true Caucus material, let us know.
--Josh Marshall
Now we know from the White House that there is no Social Security crisis and that private accounts won't guarantee the program's solvency only cost trillions of dollars and require massive benefit cuts.
On the other hand, there is still that Ownership Society Holy Grail, resplendent in all its glory, the ability to pass your private account on to your heirs.
Only, apparently not.
It's been mentioned here and there. But it turns out that you can't do that after all. In fact, probably only if you're an upper-income earner will you ever be able to get your hands on any substantial part of it, let alone pass it on to the kids, the alma mater or your favorite pet.
Under the Bush plan, when you retire you are mandated by law to use your private account funds to purchase an annuity substantial enough to keep you above the poverty line for the rest of your life. (I guess that whole letting people decide what to do with their own money bit only goes so far.) You'd have to figure that for most retirees that would run through pretty much the whole stash or at least the lion's share of it. And when you die, that's it. By definition, you can't pass on this kind of annuity.
So under the Ownership Society the wealthy can pass on their savings, but for middle income folks and the working poor, no such luck. Which, come to think of it, sounds a lot like the rentership society, or whatever benighted age it is we're supposed to be living in now.
So you may not get to pass on your wealth. But at least you have a guarantee that you won't outlive it. Which, come to think of it, sounds a lot like the Social Security, only now with the added benefit of no guarantees and financial services firms to skim off their own cut by managing your account and selling you your annuity.
--Josh Marshall
In December we brought you early word of a controversial new article by Korea expert Selig Harrison in Foreign Affairs.
Harrison argued that the evidence for a North Korean uranium enrichment program (in violation of the 1994 'Agreed Framework') was far more tenuous than the administration had led us to believe.
In the wake of the collosal intelligence failure over Iraq (a mix of political gamesmanship and genuine intelligence failure) such a root-and-branch questioning of consensus opinion gets a far more open-minded reading.
In their next issue to be released tomorrow, Foreign Affairs has a roundtable on the article -- two critiques and a response from Harrison. What makes the exchange so notable is that one of the critiques is co-authored by Mitch Reiss, who was until quite recently the director of policy planning at State, and the former head of KEDO and Robert Galluci, who played a key role in Korea policy and negotiations under the Clinton administration.
The title of their counterpoint -- Dead To Rights -- tells the tale. Their counter-argument is thorough and rejects virtually every point Harrison makes, taking him particularly to task over his explanation of various technical questions which bear directly on how and what we can and cannot know about the North Korean nuclear program.
You'll want to read this.
--Josh Marshall
Rep. Ginny Brown-Waite (R) of Florida feeling the heat back in the 5th District?
This new article in the St. Petersburg Times covers Brown-Waite's town meetings today at which she began by telling constituents about her one-on-one with the president in the limo ride to the Bamboozlepalooza event in Tampa.
"He wasn't happy with me," Brown-Waite told the crowd. This was, she said, after telling the commander in-chief she wanted to "proceed cautiously."
Apparently, at the meetings in Citrus county, she even talked up AARP's plan to ditch phase-out and solve the program's future difficulties by raising the payroll tax cap.
Can the Arch-Privatizer, Pat Toomey, be far behind?
--Josh Marshall
As we told you just after 5 PM this afternoon, we've found the Loudest and Proudest member of the Conscience Caucus. It ain't even close.
She is Rep. Jo Ann Emerson (R) of Cape Girardeau, Missouri.
As you may remember, Emerson was one of the first or first two members of the Conscience Caucus. And in the constituent letter she's now sending out on Social Security she leaves little doubt where she stands.
Emerson begins by telling constituents she "oppose[s] any cut in Social Security benefits for Americans who have, in good faith, paid into the system."
"Not only is Social Security nowhere near exhaustion," she continues, "the projections of bankruptcy do not reflect the many ways in which we can strengthen the system for the future without using aggressive and risky reforms. If Congress would seriously address Medicare reform, balance the budget, and make pension reform a real priority, then the solvency of Social Security would be assured indefinitely."
Later she writes, "I cannot support any plan to allow workers to place any portion of their Social Security taxes in risky investments, especially those that depend upon the stock market to appreciate in value."
And finally, "It remains my opinion that Social Security reform is not necessary at all if Congress would seriously address Medicare reform, balance the budget, erase the trade deficit, and make pension reform a real priority."
You can see Representative Emerson's letter yourself in the TPM Document Collection.
Late Update: We can now report that Rep. Emerson has been chosen as the Dean of the House Conscience Caucus.
--Josh Marshall
Clear the decks!
We have found out who is without a doubt the Loudest and the Proudest member of the Conscience Caucus.
More details to come within the hour ...
--Josh Marshall
A new statement from the office of Senator Lieberman (D) of Connecticut ...
"The President has not yet provided enough specifics about his Social Security reform plan to know what he's really proposing. However, based on what he’s heard so far, Senator Lieberman does have serious concerns about the President's plans. The senator does not support a privatization carve-out plan that would jeopardize retirement security or add to the debt. He would consider reforms that strengthen Social Security and enhance personal savings."
--Josh Marshall
The RNC brings in the legal eagles to defend the Social Security Speech Code.
As you'll see in this article from the South Bend Tribune, the RNC is sending threatening letters to local television stations requesting they stop running anti-Social Security phase-out ads from Moveon.org.
The ad, as it turns out, is demonstrably accurate.
According to the Tribune, the RNC letter reads:
"The advertisement in question falsely and maliciously makes reference to 'George Bush's planned Social Security benefit cuts of up to 46 percent to pay for private accounts ...' "In his State of the Union address, the president said that "Social Security will not change in any way" for Americans 55 and older."
The RNC letter said that "what MoveOn.org calls 'Bush's planned Social Security benefit cuts' is actually a plan that would hold starting Social Security benefits steady in purchasing power, rather than allowing them to nearly double over the next 75 years as they are projected to do under the current benefit formula."
(Note that the phrase "falsely and maliciously" has a <$Ad$> clear legal import in this case and sends a clear message.)
The reference to benefit cuts of up to 46 percent is a reference to the president's widely-reported intention of shifting from wage-indexing to inflation-indexing for future benefits. This is true.
Indeed, their response concedes the truth of Moveon's ad, as long as you know how to decode their rhetorical flimflam.
As you see, they seek to refute Moveon's claim by noting the president's claim that people over 55 will not be affected. Setting aside the highly-debatable point about whether even that is true, the RNC no doubt realizes that there are people under 55 -- in fact, quite a few of them.
The next 'refutation' is even more clear. They say that the president's plan "is actually a plan that would hold starting Social Security benefits steady in purchasing power, rather than allowing them to nearly double over the next 75 years as they are projected to do under the current benefit formula."
I mean, how friggin' obvious does this have to be?
Once again this is a reference to inflation rather than wage indexing of benefits. The RNC's argument seems to amount to the proposition that benefit cuts for which they believe there is an argument are simply not cuts.
All those fencing-sitting Republicans say that we need to have a full debate about Social Security. So why is the RNC trying to use the courts to muzzle any honest discussion of the president's plan?
Late Update: The secret RNC-FactCheck.org axis? Or is someone just an easy mark? We've been sitting for a while on a post about the atrociously bad fact-checking on Social Security being done by FactCheck.org, especially one they did on the Moveon ad. Notwithstanding the fact that the RNC says that President Bush has a "plan that would hold starting Social Security benefits steady in purchasing power, rather than allowing them to nearly double over the next 75 years as they are projected to do under the current benefit formula," I think we've argued pretty persuasively above that this point is bogus. The RNC can use this tortured verbiage if they like. But they can hardly claim that Moveon is lying when they call this a cut since the Social Security Administration itself calls it a cut. And look at how Factcheck.org described the president's plan back on the 1st of the month. They called it a "plan that would hold starting Social Security benefits steady in purchasing power, rather than allowing them to nearly double over the next 75 years as they are projected to do under the current benefit formula." Who's cribbing who here?
--Josh Marshall
A reader chimes in with the following question ...
Dear Josh,Over the years, David Broder has regarded himself as the voice of fiscal responsibility. Yet he also has expressed openness to SS privatization from time to time. Now that we know Bush's plan will require upwards of $4.5 trillion in new federal borrowing over 20 years, what sayeth Lord David? He has been mysteriously silent on the subject of privatization.
We're curious too.
Part of a larger story about Washington's journalistic establishment and conventional wisdom, or the wages of Russertism ...
Ask Fred Hiatt. He may have something to add.
--Josh Marshall
We've mentioned this before and certainly we're not the only ones. But it bears watching and repeating.
It is not just that Social Security phase-out is proving unpopular in some states where President Bush is popular. It's turning out to be most unpopular in some of the reddest parts of the country. Alabama is a good example. Montana is another. Or Rep. Virgil Goode (R) in Southside Virginia. And they're not the only ones.
This isn't particularly surprising when you think about it. These are areas are often older, more rural and have more voters with lower incomes. These are states where President Bush has campaigned on a pseudo-populism which is belied by his own economic policies.
Phase-out is bringing the contradiction to the surface.
--Josh Marshall
TPM reader DD makes a good point.
In Jonathan Weisman's Friday piece in the Post on Social Security he has this passage ...
White House officials responded that even if the accounts produced no more benefit than the traditional system, they would still be valuable."Even if I break even, we would argue I'm still better off because I own the money," a White House official said, speaking on the condition of anonymity. "If I die, it belongs to my estate. If I divorce, it's a marital asset. And it's protected from political risk. Government can't take it away."
If it's a 'marital asset', you really do own it. So what if you go bankrupt? What happens then?
--Josh Marshall
Eyes wide open ...
"Gov. Arnold Schwarzenegger says getting rid of public pension plans for California's state and local government workers is about helping to balance the budget. Peel back the budget wrapping on his plan, though, and you will find the governor's real agenda: the California prong of a national attack on the pension funds that have stood up for corporate reform and the interests of ordinary families and investors hurt by the recent wave of corporate scandal. The governor has proposed privatizing government pension plans and replacing them with individual 401(k)-style private accounts. His proposal strikes at the power of public pension funds, which have used their financial clout to protect the retirement savings of 2 million Californians — teachers, police officers and other public servants."
That's from Phil Angelides, Treasurer of the state of California, in his opinion column in this morning's LA Times.
--Josh Marshall
Strictly house keeping.
This new article in Newsweek contains a brief reference to TPM as a blog covering the Social Security debate.
But down at the bottom of the page, in a box entitled "Sponsored Links" there is this 'sponsored link' ...
"Social Security Reform
Reform or marketing hoax? Get the facts.
TalkingPointsMemo.com"
Click on the link and it takes you to this post.
Given that it's a Google link, it's probably appearing elsewhere too.
Now, in the four years TPM has been around, there are many worse problems we've had to deal with than free paid publicity. But TPM does no paid advertising ever. We didn't pay for this. And we don't know who did. It was only random chance that I even noticed it.
It's certainly no federal case. And the logic of it suggests it was paid for by someone or some organization who agrees with our position and wants to spread the word. We'll be contacting Google to find out who. But we thought it was important to set the record straight.
We don't run ads for TPM or our work on Social Security. Whoever is is not connected with us in any way.
--Josh Marshall
Knock, knock, knock ...
From the Lawrence Journal-World: "Count U.S. Rep. Jerry Moran, of Hays, as a Republican who opposes President Bush's proposal to divert Social Security revenues into private investment accounts. 'I dislike the connection of those accounts with the Social Security system,' Moran said during a visit to the state Capitol. Moran said he feared the transition costs of diverting money from Social Security would add to the deficit and that taxpayers who didn't do well with their investments would eventually seek help from Congress."
--Josh Marshall
First in a series of great Fred Hiatt moments. This from Monday's column ...
"On domestic affairs the Democrats find themselves in a similar box. Since for the most part they cheerfully drank Bush's tax-cut Kool-Aid in 2001, you may not have much sympathy for their quandary."
Number of House Democrats who voted for the president's 2001 tax cut: 28. Number of senators: 12.
--Josh Marshall
I'm actually a little surprised Vice President Cheney said this. But if he wants to be upfront about the folly of his administration's proposal, who am I to complain?
This from Fox ...
"We're going to borrow $758 [b]illion over the next 10 years to set up the personal retirement accounts. We think that's a manageable amount ... Trillions more after that," Cheney said, acknowledging that the personal accounts will help younger workers but will not solve all the problems of solvency.
As the Fox interviewer, Chris Wallace, made clear in the interview, the $758 billion number is itself the product of a little numerical flimflam. As Wallace says at one point in the conversation, "Isn't that misleading? Because under <$Ad$> your plan, the accounts, the program wouldn't actually start til 2009. So, if you take the first full 10 years, when people can actually invest in the program, the cost is over $1 trillion, and for the following 10 years, it's $3.5 trillion. Isn't it a lot more expensive?"
In fact, I think it's considerably worse than Wallace says. But let's leave that aside and assume it was only what Cheney says.
As we've noted repeatedly here, the biggest threat to Social Security is our accumulated national debt -- actually, even more our accumulating national debt. If we only had the debt load we have now and weren't adding hundreds of billions of dollars every year because of the president's policies, we could probably grow our way out of it.
In any case, indebtedness is our problem. And Cheney's solution is to borrow many trillions more dollars over the next two or three decades, in addition to our existing structural budget deficits which are likely themselves unsustainable. And he and the White House now admit this will do nothing to improve the financial condition of Social Security.
Following any reasonable calculation the entire debate should end right there -- though I concede that rational calculation ain't what it used to be.
Look what we hear from the administration's own collective mouth. Their solution to the problem does nothing to solve the problem -- not me saying it, them saying it. However, it does cost trillions of dollars. In fact, it will cost -- by their own estimation -- much more over the next 20 years than it would to keep Social Security going strong for the next 75 years.
At what point does this proposed policy collapse under the weight of its own ridiculousness?
--Josh Marshall
Bloomberg: "McCain, who said he supports the idea 'in principle,' said, 'there's a number of members of the Senate and House who are not happy about President Bush coming to a neighborhood near them.'"
--Josh Marshall
Is Rep. Heather Wilson (R) of New Mexico on the level?
Wilson represents New Mexico's 1st congressional district, which is centered on Albuquerque. She won with 54% of the vote in 2004 and 55% in 2002.
We've been watching the constituent mail Wilson's been sending out on Social Security and it reads right from the Speech Code playbook, sounding like she opposes phase-out but not really saying that at all.
So for instance she says she opposes 'privatization'. But of course under the speech code rules, private accounts aren't 'privatization'. She also says "government should not invest Social Security funds in the stock market." That certainly sounds like it means she's against phasing out Social Security. But the key word here is "government". Under private accounts individuals would be investing their money.
I know it may seem like I'm reading this constituent mail a tad too closely at this point. But, as you can imagine, I've read a lot of this constituent mail at this point. And representative who want to carve private accounts out of Social Security routinely use this "I won't let the government invest" language.
All of this makes her no different from a slew of other members of Congress around the country who are trying to bamboozle their constituents on Social Security. The reason I note her, though, is that the AP is running a story today putting Wilson down as opposing the president's plan.
Rep. Heather Wilson, R-N.M., echoed Democrats' opposition to Bush's plan, saying she opposes efforts to invest even a portion of Social Security revenues in private accounts."I don't believe the government should invest Social Security taxes in the stock market," said Wilson, who represents New Mexico's Albuquerque-based 1st Congressional District.
So my question is this: Did the AP just get bamboozled by Wilson's word choice flimflam? Or is she just one of the only Republicans using the English language with its plain meaning when it comes to Social Security?
--Josh Marshall
Better to reign in the Club for Growth than serve in Congress?
We spoke on Friday about how Pat Toomey, cast out of Congress and down into the Club for Growth, had, with his associates and copartners, set about making war on his former Republican colleagues in Congress over Social Security phase-out.
The Syracuse Post-Standard picks up the story on one Toomey target: restored Conscience Caucus member Rep. Sherry Boehlert (R) of New York.
--Josh Marshall
Birmingham, Alabama Dems adopt an anti-Social Security phase-out resolution.
In fact, Alabama turns out to be something of a hotbed of opposition to phase-out, among both Democrats and Republicans. Of which we'll say more later.
--Josh Marshall
Rep. Harold Ford of Tennessee, former Dean of the Fainthearted Faction, calls Bush phase-out plan "absurd" and "just wrong."
--Josh Marshall
Conscience Caucus induction grab bag ...
Rep. Mike Rogers (R) of Alabama. From the Montgomery Advertiser: "'I'm going to be a pretty hard sell,' said Rep. Mike Rogers, R-Anniston, of Bush's proposal to overhaul Social Security ... Rogers said the president's plan was 'too risky' for his constituents."I represent a poor district," he said, nonetheless praising Bush for attempting to strengthen Social Security. 'I applaud him for getting this up on the table,' Rogers said."
Rep. Joe Schwarz (R) of Michigan. From Gannet: "Another Republican, Rep. Joe Schwarz of Michigan, said Social Security 'has worked well for so long, I don't think it needs any wholesale change.'"
Rep. Tom Petri (R) of Wisconsin. From the Green Bay Press-Gazette: "Petri, meanwhile, has his own proposal that would limit personal accounts to newborns. Their parents would receive $1,000 from the government for investment in the Federal Thrift Savings Plan used by federal employees and the money could not be withdrawn until the infants reach retirement age. The Fond du Lac Republican doesn’t want to meddle with the benefits of current workers or retirees. 'I would like to hear him say that Social Security is a contract between the generations in the United States and that we will maintain and improve that contract, not undermine it,' Petri said."
--Josh Marshall
Rep. Jo Ann Emerson (R) of Missouri, early member of the Conscience Caucus, now upgraded to Loud and Proud status. More on this breaking development coming next week.
--Josh Marshall
