Thursday, January 20, 2005

Bush Unleashed

By: UnrepentantNewDealer

"Hail to the Hypocrite"

President George "Hypocrite" Bush was sworn in for his second term today. I'm sorry if that sounds a bit harsh, but that's the way the truth is. Bush's command of the English language has never been all that strong, but his speechwriters are generally up to the task of creating a memorable turn of phrase. Not so today.

Despite its turgid language, I found myself nodding along in agreement as Bush talked about the importance of the spread of freedom to the safety of our own nation, that it must be

"The policy of the United States to seek and support the growth of democratic movements and institutions in every nation and culture, with the ultimate goal of ending tyranny in our world... We will persistently clarify the choice before every ruler and every nation--the mortal choice between oppression, which is always wrong, and freedom, which is eternally right... We will encourage reform in other governments by making clear that success in our relations will require the decent treatment of their own people. America's belief in human dignity will guide our policies... All who live tyranny and hopelessness can know: The United States will not ignore your oppression, or excuse your oppressors."

I was nodding in agreement with these lofty principles in which I have always strongly believed, until I remembered this administration's track record. Sure, Bush can talk the talk, but has he walked the walk? To have successful relations with America, a ruler has to reject oppression and embrace freedom and treat their countrymen with dignity? Huh. That's funny. I seem to remember Russia having relapsed into despotism under Vladimir Putin during Bush's watch. Freedom and democracy in Russia being destroyed with barely a peep from this administration. But, wait, that's right, Putin is an "ally" of America in the "War on Terror." Besides Bush looked into the former KGB thug's eyes and declared him a good man.

The "president" of Pakistan, Pervez Musharraf, is an army general who seized power of a nuclear-armed Pakistan from a democratically-elected government. He keeps total power and has no appetite for such quaint concepts as rule-by-ballot-box, rather than by bullets, or for any sort of balance of powers or checks and balances. Like Putin, Musharraf imposes tyranny on his people. But, oh wait, that's right, Musharraf is also an "ally" in our fight against the Islamic extremists.

There are numerous other examples. Saudi Arabia and Burma come to mind. Most grievous is the situation in Darfur. A president who says that the relationship between the United States and another nation is dependent on how that nation treats its people would surely not have stood silently by while the government of Sudan and the government-trained Janjaweed militia wipe out the black African population of Darfur province. Yet that is just what Bush has done. If there were any case of a nation that needed a "regime change", it would be Omar al-Bashir's Sudan.

The Genocide Convention (to which the U.S. is a party) defines genocide as an attempt to wipe out a political, religious, or ethnic group "in whole or in part", and obligates all signatory nations to use whatever means necessary, including military force, to prevent or stop genocides. Because of this obligation, previous presidents, to their everlasting shame, have been reluctant to call a genocide by its name. Not this president. His administration condemned the atrocities in Sudan as genocide... and has done nothing since. How morally reprehensible can you get: to cheerfully acknowledge the presence of evil and do nothing to stop it when you have the power to do so? Edmund Burke's famous quote is eternally relevant: "Evil triumphs only when good men fall silent." The silence of this administration on Darfur speaks volumes.

So, rather than the cause of freedom being the chief foreign policy aim of the Bush administration, it seems that the United States has no problem with the peoples of Pakistan, Russia and other nations being denied their "God-given rights" so long as their despotic rulers deign to support our "War against Terror." "The United States will not ignore your oppression, or excuse your oppressors"? Tell that to the black Africans in Darfur who are not merely being oppressed but are being exterminated. We ignore their oppression and excuse their oppressors because while saving the lives of millions of people is good in principle, in this case it would not serve any vital narrowly-defined "national interest."

So, it's not that I object to the words the president said. The sentiments he expressed are admirable. But actions speak louder than words. And the actions of this president give the lie to the lofty words he uttered today. Except for one brief moment under Clinton, when we intervened to stop the Kosovo genocide, America has never put the spread of freedom and the defeat of oppressive rulers at the top of its foreign policy agenda. We allied with Stalin to oppose Hitler, when they were merely two sides of the same evil coin and Stalin killed far more people than Hitler did. Sometimes such undesirable alliances are necessary in wartime. The policies of nations are guided by self-interest. But, Mr. President, if we are going to ally ourselves to such despotic rulers in the name of fighting this "War on Terror", spare me your platitudes about how "ending tyranny in our world" is America's "ultimate goal." Put your money and your actions where your mouth is or shut up!

Sorry if that seems too harsh. But as an idealist who actually believes America should live up to those lofy ideals, I will not be silent in the face of evil. Nor will I be satisfied with our leaders merely mouthing the words of freedom. If the president changes course and makes the words he spoke today a reality in his second term, history may yet look on him kindly. But he has given me little cause to expect anything less than rank hypocrisy from this president.

Social Security Re-rebuttal

While I'm leery of getting into an endless battle of rebuttal and counter-rebuttal, I think the matter of Social Security privitization is sufficiently important to warrant a spirited debate:

"The problem with these projections is that they are based entirely on this "trust fund," which is, in essence, a giant pile of IOUs built up from over half a century of the government skimming the surplus off the top to pay for other social programs. The assumption is that the government will eventually have to make good on these with real money, but that may not be the case."

The first claim is that the Social Security trust fund has been depleted by Congress to pay for other programs. This is a favorite claim of politicians, who love to claim that their opponent either has or will "steal" from the trust fund. Unfortunately, contrary to what you may have heard, they can't. According to the Social Security Administration "The assets of the funds provide automatic spending authority... No legislation is needed to spend a portion of trust fund assets on benefits or administrative costs (the Social Security Act limits expenditures to benefits and administrative costs)" [Emphasis mine].

Thus, according to the federal government, the government is prohibited by law from spending money in the Social Security trust fund on anything other than benefits and the administrative costs of running the program.

The second claim is that the Social Security Trust Fund is composed of "a giant pile of IOUs." Akerman makes the claim that this pile of IOUs has built up because the government has been taking money from the trust fund. In fact, again according to the SSA, "most of the money flowing into the trust funds is invested in U. S. Government securities. Because the government spends this borrowed cash, some people see the current increase in the trust fund assets as an accumulation of securities that the government will be unable to make good on in the future. Without legislation to restore long-range solvency of the trust funds, redemption of long-term securities prior to maturity would be necessary.

"Far from being 'worthless IOUs,' the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government. It is thus likely that legislation will be enacted to restore long-term solvency, making it unlikely that the trust funds' securities will need to be redeemed on a large scale prior to maturity."

The government has never defaulted on its debts, and it's unlikely it would default in the case of Social Security's Trust Fund. And another myth bites the dust...

After making the claim that the government might not be able to pay the IOUs, Akerman then goes on to dismiss that possibility as "irrelevant" anyway. He views privitization as an improvement in the system and "If a system can be made better, even if it's okay now, our duty is to improve upon it." Well said. He then attempts to rationalize privitization: "Since only a certain percentage of the total current tax could be shifted to mutual funds (not stocks, technically), there would still be enough money in the system to pay it out (with deficits, yes, but not overly major ones) until the private system earned profits." The key part of the argument seems to be that while there would be deficits, they would not be too large, and the private system would soon make up for the deficits. So, nothing to worry about right? Wrong! As I wrote in my last blog post:

The administration acknowledges that the costs of the "transition" over the first 10 years would be between $1 trillion to $2 trillion. According to Krugman, the plan proposed by Bush's Social Security Commission in 2001 "would cost an additional $3 trillion in its second decade, $5 trillion in the decade after that and another $5 trillion in the decade after that. By the time privatization started to save money, if it ever did, the federal government would have run up around $15 trillion in extra debt."

So, $15 trillion in extra debt, on top of the $7,613,772,338,689.34 national debt (according to the Treasury Department's Bureau of the Public Debt at equals... let's see... subtract the four, carry the one ... A LOT!! Rounding, the number is about $23 trillion. We would go from having an almost $8 trilllion national debt today to a $23 trillion debt by midcentury, simply from privitization alone. And let's not forget extra non-related government spending over that period, which is bound to swell the national debt still further.

This is not merely an abstract matter. It will have real consequences. We have never had a national debt anywhere near that large. The reason economists warn against large national debts is that their consequences can be economically devastating. As in Great Depression-type devastation. By which point, any eventual savings from privitization by midcentury would be essentially irrelevant. With privitization, there would be deficits, they would be massive, and the system would almost certainly not be able to make up the deficits anytime soon, if ever.

But it gets worse for the proponents of privitization. As Paul Krugman points out, "financial markets would, correctly, treat the reality of huge deficits today as a much more important indicator of the government's fiscal health than the mere promise that government could save money by cutting benefits in the distant future. After all, a government bond is a legally binding promise to pay, while a benefits formula that supposedly cuts costs 40 years from now is nothing more than a suggestion to future Congresses. Social Security rules aren't immutable: in the past, Congress has changed things like the retirement age and the tax treatment of benefits. If a privatization plan passed in 2005 called for steep benefit cuts in 2045, what are the odds that those cuts would really happen?"

Any eventual savings under the system would likely be diminished by administrative overhead costs. Of the money that Social Security takes in, 99 percent are spent on benefits, and less than 1 percent on administrative costs. In Chile's privitized retirement pension system, management fees are roughly 20 times as high. That is about average for privitized pension programs. All these fees decrease the returns individuals get from their accounts.

And none of the privitizers' arguments mention the fact that the government, according to a number of economists, in the interests of reigning in deficits, is likely to cap the returns individuals could get from their personal accounts to the level of returns those who choose to remain under the current system would get, with the excess going right back to Uncle Sam to pay down some of the massive debt this mad privitization scheme would create. So much for the individual reaping the benefits of privitization, despite the fact that stocks would have a better rate of return than the current system. The choice is between getting guaranteed benefits of a certain amount or being able to get benefits up to but not over that certain amount. Why gamble with your retirement, and risk getting less, rather than more, when you have a sure thing in Social Security?

"When a person is allowed to make a decision, no matter how small, they begin to take pride in that decision's outcome. With the sense of ownership over these funds, people are much more likely to increase their productivity, thereby increasing not only the amount of invested funds, but the amount of taxes flowing into the "old" system."

I'm not quite sure what Akerman means by that. If an individual has an individual retirement account rather than a government-administered one, why would that lead to that individual increasing their productivity on the job? There doesn't appear to be any causality, no reason why the one would lead to the other. Is Joe Q. Public going to say, "Wow, now that I have a private retirement account, rather than Social Security, I'm going to work a lot harder! Because I 'own' this account, I am now going to care about planning for my retirement, and I never cared about this when I had a government retirement benefits program"? It appears to be a logical fallacy, the result of wishful thinking. Like so much of the President's agenda, I guess we're simply supposed to take it on faith.

Lastly, Akerman terms my conclusion that the administration's Social Security privitization plan is part of a larger pattern of rolling back all the progressive reforms of the Twentieth Century to be a "conspiracy theory." Well, let's look at the evidence. These extremist conservatives have philosohical objections to government-run social programs (such as Social Security, Medicare, etc.) and government-imposed regulations on businesses (which, in their eyes, includes everything from the Endangered Species Act to worker's safety and labor rights laws, to laws protecting the safety of America's food supply, water supply, and pharmaceutical drugs.) Any government intervention in the economy is viewed as heresy. Businesses should be free from the burden of government regulations. These are the opinions expressed by prominent conservatives. Akerman says that "One should be taxed proportionate to their means, but the current system does not do that. The tiers remove the equity from the system by arbitrary measures." Yet the current system does in fact do this. Those who can afford to pay the most in income taxes (the rich) do, those who can least afford to bear the burden (the poor) pay the least. The current debate among conservatives in Congress and in right-wing think tanks is not whether to abolish the income tax, but whether to replace it with a flat tax or a nationwide sales tax (both of which would shift the burden of the tax system off the rich and onto the backs of the poor and middle class).

I am reluctant to call them "conservatives". Traditionally, the word "conservative" has meant resistance to change, preferring to maintain the status quo. On the other hand, a "reactionary" seeks not merely to maintain the current status quo, but to return the nation to a previous status quo. It is indeed apparent that these "conservatives" are in fact radicals, reactionaries bent on undoing all the reforms of the Great Society, New Deal, and Progressive movement. Clinton's 1996 reelection campaign slogan was "Building a Bridge to the Twenty-First Century." The Reactionary Republicans' slogan could be "Building a Bridge Back to the Nineteenth Century", as they seek to reestablish the status quo that existed between government and the economy and business in the late Nineteenth Century (as well as to return the status quo between church and state to at least Seventeenth Century norms.) Just as world leaders persuaded themselves that Hitler did not have reactionary goals of resurrecting the former glory of Germany, despite the fact that he had laid out all his plans in writing in advance in Mein Kampf, so today many persuade themselves that Bush in his second term will reach out to Democrats and fashion a moderate, mainstream agenda. They ignore the history and stated goals of the Reactionary Republicans. Bush governed from the hard right in his first term, despite the fact that he lost the popular vote. Still, he had to moderate his positions somewhat in his first term, and postpone certain actions, such as Social Security privitization, until his second term. Now that he has been narrowly reelected, so that he can claim a "mandate", it would be preposterous to suggest that he will be a moderate.

During the past 4 years, we had the Reactionary Republican Bush, but he was prevented from pursuing his full agenda by the threat of not being reelected. Now that he no longer has to worry about that threat, now that Americans have inexplicably reelected this man, we shall not have a more moderate, more thoughtful, more compromising Bush. Rather, we shall have Bush unleashed. The amount of damage he managed to do in 4 years even with the impending election is bad enough. I shudder to imagine what havoc this man will create over the next four years. My only consolation is that Bush and the Reactionary Republicans will probably screw things up so badly, Republicans will be effectively locked out of national office for a generation. As cleaning up the mess his policies would create could take generations, that is a small consolation indeed.