Josh Marshall has been weighing in on the proposed Social Security reform, noting that “to the extent that we have a problem, it is not a Social Security problem, but an accumulated national debt problem.”
After 1980 we started borrowing money big-time to finance our deficits…So where’d we borrow the money? …about $4 trillion of that debt was borrowed on the open market — individual Americans have them in their investment portfolios, or pension funds hold them, or the Chinese, Japanese and the Saudis and others have them in bonds.
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).
….Let’s say there’d not been a Social Security — President Bush’s dreamworld. We’d still have had the same deficits. The difference would be that we’d have had to borrow from private borrowers in the US and abroad.
So “reform” means a partial default on debt borrowed against a program that payroll taxpayers were paying into. All the while incurring more debt.
As Kevin Drum puts it, “Bush needs to be sent down to stinging defeat on this, and any Democrat who hasn’t figured that out ought to step down and give his seat to someone who does. If congressional Democrats can’t manage a united front against an obvious political ploy aimed straight at the heart of the social safety net, they might as well pack up and go home.”
Given the often pathetically meek public face Democratic politicians are putting forth on the issue, it’s good to have at least writers who can articulate some principles for the Party.
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