| My earlier diary, "Obama's 'Mandate' To Slash Medicare, Medicaid & Social Security", focused attention on the fact that Obama's potential intention to slash Medicare, Medicaid and Social Security is wildly at odds with what his great mass of supporters wanted, and consciously voted for. Now I want to pivot, and focus attention on the small handful of folks who stand to gain exactly what they wanted from him, even though it went diametrically against the overwhelming majority of his supporters. It is, in large measure, the presence of such people in high levels of influence that substantially heightens my concern that Obama might actually take this sort of ill-advised action.
Fortunately, I don't have to do anything at all, except to quote liberally from an op-ed earlier this week, by economist Dean Baker, co-directeor of the Center for Economic and Policy Research (CEPR), in The Guardian Unlimited, "Redefining Chutzpah: Wall Street Goes After Social Security, Again". Baker begins:
The classic definition of "chutzpah" is the kid who kills both of his parents and then begs for mercy because he is an orphan. The Wall Street crew are out to top this. After wrecking the economy with their convoluted finances, and tapping the Treasury for trillions in bailout bucks, they now want to cut Social Security and Medicare because we don't have the money.
That paragraph pretty much says it all, in terms of laying out the basic foundations of this fight. In fact, given how tenacious, how vicious, and how deeply entrenched these bastards are, we're going to be fighting them for a good long time, so you may want to print it out and tape it to you refrigerator. Or tattoo it onto your eyelids. Because they will do everything imaginable to make you forget that simple truth.
More from Baker on the flip. |
Baker promises "some very serious pain inflicted on the politicians" if Congress does try to take away people's Social Security and Medicare, as Obama now seems ready to start planning for. If this does go forward, it's going to up to us to help lead the charge, but many, many others will be on the frontlines with us. Still, almost no one is talking about it yet. He continues:
Unlike Robert Rubin's Citigroup, Social Security is solidly funded long into the future. According to the latest report from the Congressional Budget Office, it can pay all promised benefits through the year 2049, with no changes whatsoever....So, the claim that Social Security is going broke is inaccurate, or in less polite circles, a lie.
For those who don't know, there was a Social Security crises back in 1983, we came pretty close to running short on funds. So a deal was struck, and people have been overpaying ever since to build up a surplus that will start being drawn down around 2017-2019 or so. This surplus will fully cover all but the heartiest of Boomer retirees. As Baker said, there is no problem until at least 2049.
Baker again:
Many people, most notably investment banker and Concord Coalition founder Peter Peterson, have questioned the solvency of Social Security based on the fact that its trust fund is held in U.S. government bonds. Peterson and others derisively refer to these bonds as "IOUs."
.... Mr. Peterson and his followers apparently want the government to default on the bonds held by the Social Security trust fund.
It bears noting that Fannie Mae and Freddie Mac's toxic bonds were guaranteed by the U.S. government-even though they were not legally backed by it, unlike Social Security's government bonds, which are, well, U.S. Government bonds. Why the federal government should back up non-government bonds, while refusing to pay government bonds is a mystery that only Wall Street bandits can fathom.
So far, they've gotten away with murder, so I guess they think that genocide would be just as easy. Baker has a somewhat different idea:
There is no reason that these bonds cannot be paid back, but if there is a serious push to default on the bonds held by the trust fund, then we should insist that Peter Peterson and other wealthy people who hold government bonds also share in the pain from default. Instead of having a full default on the trust fund bonds and full payment on the bonds held by Mr. Peterson, maybe we should make everyone take a 15 percent haircut, getting back 85 percent of the value of their bonds.
Naturally, this is the last thing that Peterson and his mob have in mind. Which is why it should be the first thin we have in mind: mess with us, and you'll go down, too, sucker.
Next, Baker turns to Medicare, which is where the real action is:
Although Social Security is paid for long into the future, Medicare does face problems due to the explosion of private sector health care costs. The way to address Medicare's shortfall is to fix the private health care system, as President Obama has pledged to do. If health care costs are contained, so that they only grow due to the aging of the population, and otherwise move in line with per capita income, then Medicare will be an affordable program. The problem is not the aging of the population, the problem is a broken health care system.
Again, to underscore just how broken and anomalous our health care system is, let me repost the chart I first posted last April, in my diary "Medicare Myths--Don't Blame The Boomers":
Baker elaborates:
If it were not for the political power of the pharmaceutical, insurance, and doctors' lobbies, we would have fixed health care long ago. If Congress cannot stand up to these special interest groups, then why not just let retirees take advantage of the health care systems in countries with less corrupt political systems?
And that's really what it comes down to: America's corrupt political system. Between the bondholders, the financiers, and the health industry special interests, everybody's being taken care of, except the American people as a whole. Keep that in mind, if Obama really does go through with this, and tries to shove this down our throats. Because if he does, it will put the lie to all his talk about fighting political corruption. He will, instead, become the number one crusader on behalf of political corruption.
Baker reminds us that these new attacks "are especially pernicious", coming as they do after the boomers have lost so much of their savings vanish with the housing bubble, and stark market crash.
Tens of millions of baby boomers who thought they were well-prepared for retirement two years ago now find themselves with little or no home equity and very little left in their retirement funds. As a result, they will be almost totally dependent on Social Security and Medicare.
Which, of course, is the exact opposite of what the privatizers were telling us just a few years ago, when Bush was pushing his scheme. Social Security was a money pit, we were told, the private markets were the fount of unlimited prosperity, if only the mean old liberals would let go!
The attacks are made even worse by the fact that the attackers, people like Robert Rubin and Peter Peterson, promoted policies that led to this collapse, and personally profited to the tune of tens, or even hundreds, of millions of dollars. In other words, after pushing the economy into a severe recession and destroying the life's savings of tens of millions of working families, the Wall Street crew now wants to take away their Social Security and Medicare. This can almost make killing your parents look like a petty offense.
Indeed. Having these scoundrels inside the Democratic Party is one of the most pernicious political evils of our time. If we allow it, they will destroy our country as well as our party. And then they will cry, because they have nothing left to loot, pilage and destroy. |
