The Jaker

The president is probably going to talk a lot about ownership and individual choice. I think those are great concepts, and I can support those -- but in addition to the current Social Security system, not as a replacement for it.

Look, you may own your home; a lot of Americans do. I bet you have insurance. Ownership and insurance have to go hand in hand.

Social Security is the insurance. Senior citizens in our country can always rely on it to make sure they're not desperately poor in their old age.

Should we have ownership and choice in addition to that? Yes, we should. But we should never do anything to undermine that insurance. That is one of the bedrock principles of our country.

Yet to be decided are several big questions, including how large the private accounts should be, how much guaranteed benefits would be cut and how to pay as much as $2 trillion needed in the first 10 years to effect the transition to a new system.

1. Gradually raise the cap on taxable income. Currently only earnings up to $90k are taxed for social security (6.2%). That's regressive (ie. Bill Gates pay a much lower % of his income into social security than I do... will he really notice the difference?).
2. Direct investment in stocks. If it's really all about getting a better rate of return, let's invest the social security "trust fund" in equities, rather than T-bills. But in one large sum, not millions of smaller accounts. It's far more cost efficent, and you get a smoothing pattern because of the pooled risk - ie. you won't be screwed if it's a recession and your private account sucks at the time you want to retire. Republicans want private accounts to push their "ownership society" that they think produces more Republicans; but their plan is clearly economically inferior.

Zogby has found evidence that stock ownership significantly alters the way people vote. For example, members of labor unions, traditionally backers of Democrats, were far more likely to vote Republican if they owned stocks. Ditto for low-income voters. Source

We are committed to saving Social Security and when we push to save Social Security, we have an historic chance to broaden our party to include more young Americans. [Emphasis mine]

Admit the goal is zero, and people will rethink birth control. "Seven percent of American women who do not use contraception account for 53 percent of all unintended pregnancies," Clinton said. That number drew gasps from her pro-choice audience. I bet if she translated it to abortions, it would knock folks in Ohio out of their chairs. How many abortions are you willing to endure for the sake of avoiding the word "condom"? Clinton says we can cut the abortion rate through sex education, money for family planning, and requiring health insurers to cover contraceptives.

Dagoberto Sáez, for example, is a 66-year-old laboratory technician here who plans, because of a recent heart attack, to retire in March. He earns just under $950 a month; his pension fund has told him that his nearly 24 years of contributions will finance a 20-year annuity paying only $315 a month.

"Colleagues and friends with the same pay grade who stayed in the old system, people who work right alongside me," he said, "are retiring with pensions of almost $700 a month - good until they die. I have a salary that allows me to live with dignity, and all of a sudden I am going to be plunged into poverty, all because I made the mistake of believing the promises they made to us back in 1981."

On the Senate floor Wednesday, Sen. John McCain, R-Ariz., suggested Democrats are sore losers. Rice had enough votes to win confirmation, as even her Democratic critics acknowledge, McCain said.

"So I wonder why we are starting this new Congress with a protracted debate about a foregone conclusion," McCain said. Since Rice is qualified for the job, he said, "I can only conclude that we are doing this for no other reason than because of lingering bitterness over the outcome of the election."

President Bush carried Florida handily last November. But there was something else on the Florida ballot that got little national attention -- an initiative to raise the state minimum wage to $6.15 an hour.

The initiative was put on the ballot by the community organizing group ACORN and a coalition of unions, MoveOn, and others with 975,000 signatures. The minimum wage initiative was opposed by nearly all Republicans and business groups.

Not only did the initiative win by a stunning 72 to 28 percent; it won in every single Florida county, even rock-ribbed Bush territory.

• Barbara Boxer standing up against 99 other Senators to support an investigation into election abnormalities in Ohio
• Barbara Boxer and John Kerry holding Condi Rice accountable for the Bush Administration's reprehensible foreign policy, and voting against her
• Hillary Clinton making sensible noises on finding common ground with abortion opponents
• Harry Reid's performance so far as Minority Leader, including introducing 10 bills as the Democratic Agenda for the 109th Congress, symbolic as it may be

But this can only be a stopgap. We have about a year and a half to recruit, fund, and elect Democrats to reclaim Congress.

President Bush is like a financial adviser who tells you that at the rate you're going, you won't be able to afford retirement - but that you shouldn't do anything mundane like trying to save more. Instead, you should take out a huge loan, put the money in a mutual fund run by his friends (with management fees to be determined later) and place your faith in capital gains.

The Post: Will you talk to Senate Democrats about your privatization plan?

THE PRESIDENT: You mean, the personal savings accounts?

The Post: Yes, exactly. Scott has been --

THE PRESIDENT: We don't want to be editorializing, at least in the questions.

The Post: You used partial privatization yourself last year, sir.

THE PRESIDENT: Yes?

The Post: Yes, three times in one sentence. We had to figure this out, because we're in an argument with the RNC [Republican National Committee] about how we should actually word this. [Post staff writer] Mike Allen, the industrious Mike Allen, found it.

THE PRESIDENT: Allen did what now?

The Post: You used partial privatization.

THE PRESIDENT: I did, personally?

The Post: Right.

THE PRESIDENT: When?

The Post: To describe it.

THE PRESIDENT: When, when was it?

The Post: Mike said it was right around the election.

THE PRESIDENT: Seriously?

The Post: It was right around the election. We'll send it over.

THE PRESIDENT: I'm surprised. Maybe I did. It's amazing what happens when you're tired. Anyway, your question was? I'm sorry for interrupting.

The Post: So have you talked to Senate Democrats about this?

Q: Is the Army broken?

A: Yeah, I think so. We're on the brink. We are in a situation where we are grossly overdeployed, and it is unlike any other period in the 229-year history of the Army. We have never conducted a sustained combat operation with a volunteer force, with a force that we have to compete in the job market to hire every year. Every other force that we've ever done this with, going back to the Vietnam period to something comparable, has been a draftee conscript force.

So what we are all worried about is that the manpower situation will come unglued. ... The Army is people; it's not weapons or platforms. Somebody once said, "A soldier's not in the Army; they are the Army." And the quality of the soldiers [has] been the enormous advantage we've had since the volunteer force was put in place, and the quality of the noncommissioned officers corps.

Well, that is a married Army, among other things. You may recruit soldiers, but you retain families. And I think we're all concerned that we are teetering on the brink here and that if we can't get to a lower operational tempo, or at least have some point in the future that we can set our sails against where it might occur, that the Army on the manpower side's going to come unglued.

In any case, Social Security could capture the return on stocks, without putting individuals at risk, by investing in equities directly. This would also achieve another frequently stated objective: keeping the government's hands off the Social Security trust fund. That option would be far more efficient, in economic terms, than separating the money into 150 million disparate accounts. Costs are much lower for one big investor. And more important, in a system of individual accounts, benefits will vary with individual choices, and some people will make poor ones. In Sweden, where the retirement system has included private accounts since 2000, the majority of Swedes made excessively risky investment choices by putting money into stocks at the market top, according to Richard Thaler, a University of Chicago behavioral economist. Finally, pooling the investment pools the risk, and thus reduces the danger of retiring at the wrong time. In a system of personal accounts, someone who retired after a market crash would be out of luck.

So it is notable that all the current proposals to privatize involve the economically inferior option of individual accounts. But privatization advocates aren't motivated solely, and perhaps not even primarily, by economics. Glenn Hubbard, Bush's former top economic adviser, wrote in Newsweek that an ''obvious objective'' of privatization is ''to advance the president's ownership society agenda.'' Such pro-free-market sentiment has a long lineage. Remember Senator Vandenberg, who fretted in the 30's that public ownership of private securities would amount to socialism? Even though state pension funds and some U.S. agencies, including the Federal Reserve, put some pension money in stock-index funds, conservatives still react as if such a solution for Social Security were akin to turning it over to the Kremlin. Peter Ferrara, a former White House staff member under Reagan and now senior fellow at the Institute for Policy Innovation, who has been proposing Social Security privatization plans since the late 1970's, told me that economics ''was not my primary motivation. It was ideological. We don't want the government controlling that much investment.''

We hear... that it could get crowded for the Democrats in 2008. John Kerry has said he won't rule out running again, and now comes word Tipper Gore is telling friends that Al is eyeing another race himself.

A conservative government sweeps to power for a second term. It views its victory as a mandate to slash the role of the state. In its first term, this policy objective was met by cutting taxes for the wealthy. Its top priority for its second term is tackling what it views as an enduring vestige of socialism: its system of social insurance for the elderly. Declaring the current program unaffordable in 50 years’ time, the administration proposes the privatization of a portion of old-age benefits. In exchange for giving up some future benefits, workers would get a tax rebate to put into an investment account to save for their own retirement.

George W. Bush’s America in 2005? Think again. The year was 1984, the nation was Britain, the government was that of Margaret Thatcher -- and the results have been a disaster that America is about to emulate.

We don’t have two parties at loggerheads. We have one party of moderates and one of extremists.

to gut federal programs for the poorest Americans to make way for tax cuts, a mission to Mars and other presidential priorities.

In addition to the illegality of these actions taken by your Administration, we believe that the act of bribing journalists to bias their news in favor of government policies undermines the integrity of our democracy. Actions like this were common in the Soviet Union, but until now, thought to be long extinguished in our country.

These revelations regarding Mr. Williams are the latest – and most disturbing – in a series of actions by your Administration to manipulate public opinion through covert propaganda. On May 19, 2004, the GAO found that your Administration illegally spent taxpayer funds on covert propaganda by paying Ketchum Incorporated to produce fake news stories promoting the image of the new Medicare law.

There are moments in history when civilisation redefines itself. Times when momentum builds to bring down a status quo that people are no longer willing to
accept. The abolition of slavery was one. So were the fall of the Berlin Wall and the end of apartheid.

When it comes to the wanton loss of lives to extreme poverty and disease, 2005 might be such a moment. Right now it seems unthinkable: the year has begun on an incomprehensibly tragic note in Asia. Yet momentum has been building to make this the year when the world finally gets serious about changing the future for its poorest people. The coming 12 months are a test for us all - especially the leaders of G8 nations, whose vision and resolve have never been more on the line.

History's judgment will be harsh if we fail, precisely because we are the first generation with the power to succeed. New tools and ideas are creating opportunities that were, very recently, unthinkable. Conventional wisdom used to be that foreign aid could not buy measurable results. That attitude -with its ally, indifference - is erodingin the face of dramatic progress, particularly in health.

It allows the Republicans to focus on the issues, the agenda that is before us, and not to have Tom DeLay be the issue. I feel like we have just taken a shower.