(WORKING ON THIS. PATIENCE.)
SOME PRELIMINARY THOUGHTS ON
THE QUESTION OF SOCIAL SECURITY REFORM
Back in the old days when America was truly a grass-roots democracy and most folks earned their living by the sweat of their brow, there was a saying -- born of bitter experience in the daily struggle for life -- that "You can't cure an egg-sucking dog." Farmers' wives and chore boys know that an egg- sucking dog will hang around waiting for a hen to produce an egg, and then ravenously devour her latest production while the hen voices her indignation for all, hopefully including Farmer Brown, to hear.
Well, the egg-sucking dog of American politics is the Republican Party -- or more accurately the financial sector of our economy, the financial elites as Kevin Phillips calls them (Wealth and Democracy, 2003) -- as it developed after Teddy Roosevelt's departure from the political scene. Ever since the Republican Party has contrived to minimize the taxes imposed on the rich and powerful and, when Social Security was first enacted during the Great Depres-sion -- an unhappy result of unbridled speculations by the Wall Street crowd so beloved by political figure-heads such as Bush and Schwarzenneger -- has done everything it could to kill one of the few governmental programs that has really worked to the satisfaction of most Americans, "the great unwashed," as some of the aristophiles of my own family were wont to describe people who worked for a living.
How do I know this? Well, ever since the Eisenhower campaign I have been a very active Republican, working on and running many political campaigns. I was twice the Republican Party's candidate for Congress in a Northern California district which favored Democrats by a 3 to 1 margin. So I was a sacrificial candidate. But it gave me access to many meetings in which the hatred of would-be Kingmakers for Social Security, trial lawyers, and anything else that would empower the little guy and gain him some measure of freedom from the economic and legal shackles the Big Money Boys believe are in their most vital interests to keep working stiffs in their place. (Why did I become a Republican, you may ask? Because the Democratic Party, in its own way, was and is just as bad. And because I was a damned fool who thought the two party system could be made to work if Republicans returned to their basic values.)
So George Bush's preoccupation with wrecking our Social Security insurance program -- which worked very nicely over the years in spite of the many raids on its Trust Fund by the politicians of both major parties that have created a debt of nearly four trillion dollars that Bush and his crowd just can't find ways and means of repaying -- is an old, old, story, even with George W. (Perish the thought that his famous tax refunds to the rich and famous had anything to do with the problem.)
At one time, the Republican Party, the party of Lincoln and Jefferson, stood for solid, grass-roots American values, prudence and responsibility in fiscal matters, and concern and respect for individual rights and liberties. But, bit by bit, as American evolved from an essentially agricultural to a industrial society where the marshalling of capital for railroads and mass production ventures became essential, the financial sector came to dominate the production sectors of our economy.
In the first half of the 20th Century two world wars, which devastated the economies of Europe and Asia, left the United States as the world's dominant manufacturing and production society and invested our people with a prosperity which also made us the world's dominant con-sumption society. And in both production and consump-tion, the financial sector came to dominate all aspects of American economic life. Then, after WW-II, first in a fit of altruism and then driven by the demands of "bottom line" finance, huge elements of our heavy and light industry were transferred to Asia and Europe -- and later to South and Central America -- in search of cheap labor, and our farmers were driven from the land, to be replaced by great agricultural corporations, and the men and women who earned their daily bread in our fields, our mills and mines and factories lost their jobs.
And nobody asked "Where did our people go?" The ones who tilled the soil, who labored in all manner of productive enterprises. No one asked and no one, except the dispossessed, seemed to care. Certainly not the stockholders; they were doing very well indeed. Not the powerful labor unions whose leaders' primary concerns were retaining their control, their positions of power, and who cut their own deals. (Vide the ILWU's $27 million sell-out that made container shipping possible and allowed an ever growing river of Asian manufactured goods to flood our marketplaces, displacing more of whatever home grown production remained. And none of the feckless politicians of either major political party bothered to consider what were the consequences of every increasingly efficient production and ever increasingly inefficient consumption economy. Even though it was obvious that a train wreck of monumental proportions was shaping up.
It all seemed so statistically neat. More and more new jobs were being created by the computer and entertain-ment industries. The unemployed numbers seemed to be low -- most people didn't bother to ask how those statistics were generated, or what happened to the people who had lost their jobs. True, the welfare numbers were growing astronomically, but we all knew that was just because a bunch of shiftless niggers were breeding irresponsibly. (Don't get your water hot. This is irony.) Unmentioned was the fact that half of the people on welfare were white. Besides, a facade of consumption efficiency was maintained by all those welfare checks and food stamp programs, paid by the taxpayers at large, of course.
And no one counted the homeless and mentally defi-cient Ronald Reagan first unleashed upon Californians even though they were in plain view, pushing their shopping carts from here to there, sleeping in back alleys near restaurant dumpsters, shitting in our parks. And who knew, or even cared, how many were living off of the burgeoning illegal drugs industry, even though our prisons were filled to the brim and overflowing and our judicial system in a state of collapse. The druggies and the dealers and their lawyers were spending money like it was going out of style, which also created the appearance of con-sumption efficiency.
Nor need we mention the army of government emp-loyees from D.C. to the smallest local district, or the horde of "students" living off their parents and easy government guaranteed loans while learning virtually nothing of any real employment value in the forest of lesser institutions of "higher" learning that proliferated like mushrooms after a spring rain. Hardworking moms and pops holding down two or more jobs to pay for that new, low down payment dream house with all the fixings also purchased on easy payment plans, just didn't have time to teach their kids how to work by cutting the lawn or doing chores for neighbors. (Who ever dreamed that the tax collector would want more and more money as the assessed value of that house rose year after year?) And then there came those hardworking Mexicans and other immigrants, legal or otherwise, who were willing to work for practically nothing. So why punish the children?
And don't forget the Cold War, and Vietnam and then the Gulf War -- nothing like a good war and huge military budgets to stimulate consumption. And so around the world the wheels of industry spun and spun, and Americans consumed and consumed. The Great Toad that devours everything, even, in time, itself.
And then the stupid rag-heads had to go and pull 9/11! Hell, it was only a matter of time before we again collapsed in our mad pursuit of money at any price.
And George W. Bush, riding high on the strength of his forthright reaction to 9/11, decided he had a "mandate" from the people to return to his boyish dream of getting rid of Social Security. Wow! Did he ever get a wake-up call. But did he heed it? No way. He just kept repeating the old mantras: America owes her greatness to the Gods of the Free Market. Trust the Market. "On average" it will make the "average" investor a tidy profit -- on average. Don't tax the rich; they are the investors who make the wheels of industry spin. Yeah! The wheels of Asian industry. And who finance it all with tax free government bonds and inflation protected I-bonds. The working people pay the taxes; the rich loan the taxpayers their money. Just like the good old war days, when the poor boys went into combat while the rich boys got jobs in D.C. and everyone made money.
Of course with the stock market there are downs to go with the ups, but those are only market "adjustments." If you have enough smarts and get out of the market at the right time you can minimize your losses, and retain enough "capital" to get back in the market again, "at the right time." Just the kind of game working people can play with the 6.2% of their earnings they will save if Social Security is "reformed."
Great idea, George! Simply great! Don't blame anyone except yourself and Karl Rove if the Democrats take over the House in a few months, and immediately start im-peachment proceedings. You know, good Christian that you are, the Bible said, "As a dog returneth to his vomit, so a fool returneth to his folly." (Proverbs 26:11.)
Hey, we started out talking about a dog, an egg-sucking dog. And now we're back to a dog again. How neat! Or is it "ironic?"
Anyhow, with these minor points off my mind, I thought we'd start off the debate -- and hopefully a flood of letters -- by an e-SOCIAL SECURITY REFORM column Marie scat-tered far and wide early last year when George IV renewed his campaign to knock Social Security in the head.
NEW HORIZONS IN POLITICS
Let the sunshine in.
Marie Pangloss, editor.
Santa Barbara, California
February 6, 2005
LIES, POLITICS, AND SOLUTIONS TO THE DAY’S PROBLEMS
A lot of misinformation and outright lies are being tossed about by those who support the Bush Plan to “reform” Social Security.
For example, Michael Tanner, Director on Social Security Choice of the ultra conservative Cato Institute, on January 14, 2005, wrote: “The Social Security payroll tax is already 12.4% of wages, or one-eighth of a worker’s total annual wages. It is the biggest tax the average household must pay.”
Well, not quite. In point of fact only (and I hesitate to use the term “only” because it’s a mighty hefty chunk) 6.2% of the Social Security tax is paid by the “worker,” the little guy who is a member of the “average household.” But, oh, how Cato—whom we know to be one of the most vocal supporters of Bush’s plan to “reform” Social Security — weeps for the poor working stiff, whether he or she works in the factories, the fields, the hospitals, or the offices, at hauling garbage, making movies, serving food and cocktails or making beds.
Why can’t Tanner and the other mouthpieces for Cato and the Heritage Foundation, propaganda organs that are fancifully called "think tanks" by the Big Business interests who lavish money on them, at least appear to be honest when they toss their numbers around. Most Americans know that the right wing Republicans aren’t worried about the little guy who works for wages to support his "average household' and bears the major tax burden in these United States. What they want and have always wanted, at least as long as I have been a Republican, is to get rid of Social Security, one way or another, by hook or by crook, and Mr. and Mrs. Average American be damned.
Why? Well, “why” indeed. BECAUSE THE OTHER HALF OF THE SOCIAL SECURITY TAX COMES OUT OF THE EMPLOYER’S PROFITS. (Unless the worker is self-employed, as I was for over 40 years and then he pays both sides up front and doesn't get an income tax deduction like larger busi-nesses and corporations do.) And we simply must do everything we can to keep that bottom line — the only line on the balance sheet corporate executives and stockholders really care about -- as large as possible, even if it means exporting our industries, outsourcing our services, shifting the tax burden from the rich and very well-off to the middle class and working people, and knocking Social Security in the head.
And they want to let us “invest” our Social Security money in the Stock Market. Give me a break. They must think we’re simple in the head, like we can’t remember 3 years back when the Market went in the toilet and hasn’t climbed out yet. Hey, why not let us go to Vegas and play Red or Black on the roulette table? It’s the same game, the market will either go up or go down, Red or Black, and the House (the stock brokers and financial advisers) will still take its cut. But oh, they say. On “average” the Market makes money for the gamblers. Yeah, well, on “average” the rich get richer and the poor get poorer. On “average” the smart money, the insiders, always win and the suckers always lose.
The President is just kidding himself with his rhetoric. The people—those who support him and those who oppose him in this ill-advised adventure--know what the fight is all about. Maximize that bottom line and let Mr. and Mrs. Average American fend for themselves. Hey, that’s Free Enterprise, the Free Market Economy, the American Way. And just to be sure the little guy remains powerless, get rid of the trial lawyers, too. It’s not about being fair, or just, or helping those who can’t help themselves; it’s just some more of that old power game, King of the Hill.
Does the President really want to “save” Social Security? Well, a couple of obvious plans—which no one wants to talk about—come to mind.
Number one would be to pay off all those IOUs in the Social Security Fund, establish a panel of experts to manage the Fund with powers to make the kind of sound investments private sector trustees are obliged to make (but no more government bonds, we’re already $7 trillion in the hole as it is), give them a seat on the stock and bond exchanges of the nation (no sense in making the brokers any richer), hold them civilly and criminally liable if they pull an Enron, and guarantee the security of the fund with “the full faith and credit” of the US. Then they might make some money over the long haul.
Or number two, which would be a sure winner, and expected (on the basis of Market activity for the years 1999-2002) to produce some $1.3 trillion per annum, is an even quicker fix, and carries an added bonus as a solution to the Income Tax disaster. Just impose a small sales tax of one half of one percent on stock market trades, and apply the proceeds to the retirement of the Treasury Bonds held by the Social Security Fund to replace all those Social Security tax dollars many Congresses, both Democrat and Republican alike, have been so happily spending over the years.
What a happy solution! A twofer, a two-for-one solution to Bush’s two first priority programs, Income Tax and Social Security Reform. Just a teeny weeny little tax on tax stock trades of one half of one percent dollar value--which might bring a yip or two from the stock brokers, but really shouldn’t worry them because it is far less than the commissions they charge.
And who knows, perhaps the brokers won’t complain? After all, they didn’t shrink from paying Dick Grasso some $139.5 million for his 7 year tenure as their Chairman and CEO. (Now there’s a retirement package for you! Not bad for a guy who started out as an $82.50 per week clerk and rose to the very top where all he had to do was ring a cowbell and cheer the lads on. But that’s the American Way, folks. A truly inspiring and heart-warming story.)