Monday, January 03, 2005

Cue the Actuaries

Social Security. Who could predict the future of such a giant program with costs in the trillions? Those are some pretty hefty numbers that amateurs like you and I should not attempt to lift at home. So bring in the professionals: The Actuaries. These are people for whom calculus is like simple arithmetic to you and I. Numbers are their life. They get this kind of stuff.

I wonder what the actuaries have to say about the President's claim that Social Security is headed for a $10 trillion dollar deficit. A deficit that could (cue scarry music) bring down the whole program (cue scarry music up an octive), threaten the economy (cue orcestra stab), and ruin the lives of countless of our hard working American citizens. Gotta love the Bush dramatics. Cue the actuaries:
Well, the $10 trillion figure is the closest you can get to pulling a number out of the air. Make that the ether. Starting last year, as the groundwork was being set for the emerging debate, the Social Security trustees took the liberty of projecting the system's solvency over infinity, rather than sticking to the traditional 75-year time horizon. That world-without-end assumption generates the scary $10 trillion estimate, and with it, Mr. Bush's putative rationale for dismantling Social Security in favor of a system centered on private savings accounts. The American Academy of Actuaries, the profession's premier trade association, objected to the change. In a letter to the trustees, the actuaries wrote that infinite projections provide "little if any useful information about the program's long-range finances and indeed are likely to mislead any [nonexpert] into believing that the program is in far worse financial condition than is actually indicated."

As it often does with dissenting professional opinion, the administration is ignoring the actuaries. But that doesn't alter the facts or common sense. If the $10 trillion figure is essentially bogus, so is the claim that Social Security is in crisis. The assertion that doing nothing would be costlier than enacting a privatization plan also turns out to be wrong, by the estimates of Congress's own budget agency.
Ah yes. Little if any useful information. Next the Bush administration will tell us that they know just where the Social Security shortfalls are, and that they need to preemptively take out this threat to our economy by letting Joe American invest his own money in the stock market. The doctrine of preemption is quite elastic, you know.

Let's face it. What this whole latest scam by the Bush administration is focused on not repaying Jr.'s debts created in large part thanks to his tax cuts for the rich elite. Josh Marshall explains where our debt is came from and how Bush is trying to scam his way out of repaying it:
But about $3 trillion of those dollars we needed to fund the 1980s and 1990s deficits we managed to borrow closer to home. We borrowed it from the Social Security (and a few other government) trust fund(s).

Almost the entirety of President Bush's Social Security phase-out plan comes down to a simple proposition: finding out how not to pay it back.

Now, admittedly, this is an approach that the president is rather familiar with from his own business career at various failed energy companies. But it is, in so many words, a straight up con -- one of vast scale, and one which virtually no one in the media ever frames in just these terms.
That's right boys and girls, it's a con. A con of epic proportions. Just like Iraq and WMD. There were no WMD in Iraq. Social Security is healthy and successful.

Fool me once, shame on me. Fool me twice...