Uneasy Rhetoric

Talking Points Memo has an excellent analysis of the smoke-and-mirrors of Bush’s so-called embracing of indexing Social Security benefits.

For a liberal like me, such a move might not be such a bad thing in and of itself, except for two points that TPM brings up:

1. Indexing would make Social Security look much more like a program for poor people than a program for all Americans. I once heard the former president of Sweden speak about why social programs were popular in his country and he said, essentially, it was because everyone benefited in some way. This is the magic of Social Security. Currently, everyone benefits. As a bonus, it has helped keep the poverty rate among elderly Americans low (and it allows our employers to offer much more crappy retirement plans, if we get them at all).

Making Social Security into an anti-poverty program will immediately reduce its popularity.

2. Bush still wants to create a Social Security system without the current system’s security. Indexing is just a way of making it more popular with liberal Republicans and conservative Democrats and, more importantly, a way of cutting benefits to recoup some of the enormous costs the US would accrue during transition to his new system.

Social Security may not have the kind of returns that the magic market has at its best, but, for many, it is also a hedge against the magic market at its worst.

As TPM says:

Social Security is the sheet anchor [?] of the modern American middle class. It’s why working Americans can approach retirement with an assurance of security and a modicum of leisure. It stimulates economic vitality by creating a floor of security that facilitates economic risk-taking in investment and business. It’s why parents don’t have to shortchange investment in children’s education by supporting parents in their old age. It provides economic security to families hit by catastrophe and misfortune in mid-life.