Social Security
A 9-year-old shills for Social Security privatization
By Jerry Mazza
Online Journal Contributing Writer

Mar 5, 2005, 21:21

Step right up, it�s the greatest carnival on earth. As reported originally in The New York Times, and carried as far as the China Daily, 9-year-old Noah (ain�t he cute)? McCullough of Texas has agreed to shill (stump) for George W. Bush�s Social Security privatization proposal.

It�s not quite a meeting of the minds. Noah has an "encyclopedic command of presidential history," which earned him five appearances on that noted political forum, the "Tonight" show, and some off-beat experiences in the presidential campaign last year. Bush weighs in with a sub-par 91 IQ, but does actually act like a 9-year old when he can�t get his way.

That is, he keeps pushing privatization, despite the fact that he knows it will do absolutely nothing to improve Social Security today or in the future. What Bush needs to do is simply raise or eliminate the taxable income cap of $90,000, or raise somewhat the tax that workers pay, as Reagan did in the 1980s, to increase revenue streams. Believe me, it ain�t rocket science. And we really don�t need either boy wonder to sell privatization to us. Because the big P will cost $4.6 trillion (which will have to be borrowed) in the next two decades to set up 155 million accounts in all, plus play Wall Street handling fees of $60-$90 billion dollars a year. That ain�t rocket science either, but simple arithmetic.

I mean I know Noah beat Howard Dean in a trivia contest at the Democratic National Convention and wrote eloquently for his local newspaper about his trip to see the inauguration. But privatization and Social Security aren�t trivia. And I wonder if Noah mentioned in his news story that 50,000 cops were brought in to wall and haul away inauguration protestors if they got near Junior. Or the fact that Junior was afraid to get out of his car and walk among the people until he hit the gated compound surrounding the podium. I�d love Noah�s take on that. The funny thing is Noah�s mother, Donna McCullough, is a former teacher and claims she�s a Democrat. And the kid shills for Bush. Wow.  How about a trip to the Jackson ranch?

Now I assume if Noah�s a volunteer spokesman on Social Security, he�s got all the numbers on it. Like the 47 million Americans who receive it. And how for two-thirds of the elderly, SS is the major source of income. For the remaining one-third, it is their only source of income. In fact, more than 9 in 10 retirees now get Social Security benefit payments each month.

Also, Social Security also goes to kids who never get a chance to go to work because they are seriously disabled. It goes, too, to the children of a disabled or non-disabled parent(s) receiving Social Security. Also benefits go to widows or widowers of passed on recipients so the former can get through life. See this is real help for real people in real life. It�s not a game show on TV, Noah. And George, it�s not a my-will-is-stronger-than-your-will thing. It�s a survival thing for millions of seniors and their family members. Get that through your aspartame-riddled brain.

See Noah, Social Security provides guaranteed benefits based on what the worker paid in: taxes of 6.2 percent on lifetime income, another 6.2 percent matched by employers. Right now, recipients receive benefits that are pegged to the growth in wages while they�re in the work place. The White House would like to change all that and peg benefits instead to inflation, which grows at a slower rate than salaries do. The effect on retirees would be that their SS benefits would no longer keep pace with living standards. It would mean Social Security would more and more replace less and less of one�s previous wages once you retired. That current wage replacement rate is now about 33�35 percent. It would fall to 20 percent for young workers and keep falling under this privatization plan.

In fact, all the real action in terms of lowering the Social Security deficit comes from changing how benefits are computed. It doesn�t have anything to do with individual accounts. So the government can reasonably raise taxes or caps or cut benefits and make relatively painless adjustments. Or the government can unreasonably go and borrow trillions of dollars for private accounts, which won�t improve Social Security one whit, but will only siphon off money from the Social Security Trust Fund and put it into the pockets of Wall Street profiteers.

Consider also that Social Security like few things in our government works efficiently. Administrative costs run just about 0.6 cents of each buck paid out in benefits. The English system of private accounts gulps 15 cents on every buck of benefits. And believe it or not, in this age of Enron, Bush�s favorite charity, Social Security has a minimum of fraud and/or abuse as government audits have repeatedly shown. Are you listening ,Noah, George, Karl, and Dick?

Then too, just three-quarters of Social Security�s income pay for all the benefits presently. The other quarter goes into the Social Security Trust Fund, where it gathers interest from Treasury Bonds. Now by 2016, given the sagging economy, outsourcing jobs, corporations turning full-time employees into part-time employees, the number of people paying into Social Security will be decreasing as the recipients are increasing. If we had a thriving economy, not an enormous deficit economy, a job-building not a job-destroying economy, an economy prepared to eliminate tax cuts for the rich, not make them a $10-trillion permanent entitlement, the Social Security income stream would greatly improve. But even if the above doesn�t happen, Social Security can pay out until 2042.

Actually, the non-partisan Congressional Budget Office did an independent investigation of Social Security�s finances and came up with an even brighter picture. They found that it could pay all benefits through the year 2052 with no changes whatsoever. Furthermore, according to both sets of projections, the changes required to keep the program solvent through its entire 75-year planning period are smaller than the changes made in any of the decades from the 1950s to the 1980s. So what�s the problem here, Noah?

Well, the big problem Social Security faces is redeeming the $1.67 trillion of government securities in the Social Security and Disability Trust Funds when they may be needed to pay benefits. That Social Security money was spent by politicians like Mr. Bush, his dad, and President Reagan on other government programs. And that includes those gluttonous tax cuts for the rich in the past four years. But the truth is, Noah, your pal Junior and his friends are trying to claim that money isn�t there. See the money can�t "not be there," because the Social Security Trust is holding U.S. Treasury Bonds for the money borrowed from it. And by law, they have to be honored, not blown away as empty IOUs. Just like Japan�s $750 billion in Treasury Bonds or China�s $450 billion in Treasury Bonds, and everybody else�s UST Bonds have to be paid. The SS Trust�s bonds must be paid. Period, no questions, no razzle-dazzle needed.

What�s more, that naughty Junior spent every dollar of surplus income that came into the Social Security Trust during his first four-year reign. Yup, that's $500 billion dollars. Bad boy! The only other president to burn up every dollar of surplus SS Trust income during his administration was, guess who?�you�re a trivia nut. It was Junior�s papa, George H. W. Bush. Wanna guess his IQ, Noah? Ninety-eight. You see a trend here?

Also, here�s the thing about privatization, aside from the cost to taxpayers to set it up. If you put a piece of your payroll taxes in a personal account, your future benefits will be reduced by an amount equal to the amount you would have to pay back if you had borrowed the money at a real interest rate of 3 percent. Wrap your young mind around that. This is just fancy language for privatization being a loan. According to an administration spokesperson, you have to "borrow, speculate and hope." That�s not security. In fact, you�re paying back in benefits whatever you make in the market. And then you will be asked to buy an annuity, to guarantee your income won�t sink below the poverty level. That�s not security either, Noah. I hope your mom reads this and helps you understand. Even a whiz kid like you should know what he�s selling, up front, as the adults say.

Now I also know that Progress for America (PFA), the lobbying group for Junior, which spent $45 million backing him last year, plans to dump another $20 million on Social Security disinformation this year. It�s blown $1 million on TV spots so far and is working to send disinformation experts around the country. Like Thomas Saving, a trustee of the Social Security Trust Fund, Rosario Marin, a former United States treasurer, both of whom should know better. And then there�s you, Noah, signed (dare I ask for how much?) to spread the fake word, even though you won�t be eligible to collect Social Security for nearly 60 years.

You�re going to a bunch of states to soften people up for the president�s visit to follow. You�ll be on radio, with more liars probably than you�ll meet in a lifetime. Stay away from Rush Limbaugh. He�s a major drug-head. I�m surprised your mama would even let you hang out with people like this. It�s like a lamb fronting for the wolves. I certainly hope you don�t run into Jeff Gannon, the gay prostitute who was playing reporter in the White House, and lobbing softball questions to the president, and who has even been reported to be visiting George�s sleeping quarters. The story has it, well, it�s not so nice to tell but Gannon�s brought some other gay prostitutes to visit members of Congress, the White House staff, and even board members of the Federal Reserve. There is also a story surfacing that talks about GHW Bush�s involvement with pedophilia prostitution. Noah, frankly, I think these guys are dangerous, and you should stay far away from them.

If you were my child, and I�ve got three, two grown, one 16, I wouldn�t bring you within shooting distance of them. I also understand this trip was the big idea of Stuart Roy, a former aide to Representative Tom DeLay, (R-Tex.), who just came aboard the DCI Group, a political consultancy in Texas with ties to guess who: the Republican Party and Junior. This company, Noah, is up to its ears involved with Progress for America.

PFA�s president, Brian McCabe, is a partner at DCI, and the old organization has a contract with DCI. In the 2004 campaign, the Progress for America Voter Fund shelled out about $800,000 to DCI. I guess Mr. Roy knew you, Noah, because you live in suburban Houston, part of Mr. DeLay�s district. It�s said you even got to meet the old hammer.  According to Roy boy, "We�ll have Noah there as the face of Social Security reform . . . It�s about the next generation."

You know what, Noah, they�re lying again. It�s not just about the next generation. It about folks today, too, and how your grandparents and older people are going to live when their benefits start getting slashed to potato peels. As to the next generation, there won�t be any Social Security left if Junior has his way. Even those pathetic privatization accounts will probably have gone bust after the Republicans and their friends on Wall Street have fully looted the system.

Now, I also read that you got interested in presidents as a 5-year old after a kindergarten election. But this isn�t kindergarten and these guys aren�t even playing by kindergarten election rules, one vote for one kid. Read up on how they pressured the United States Supreme Court to stop the 2000 election recount in Florida, or how people were kept from voting, and how voting machines were tampered with. I know, too, you�ve read 3,000 books on presidential history. Read some more about Franklin Delano Roosevelt who started this Social Security Program in 1933, in the middle of a terrible depression brought on by Republicans like Herbert Hoover, who just stood by as the economy went bankrupt. See, the stock market crashed because people were buying stock with borrowed money (on margin) sort of like privatization is urging them to do, and the super rich folks just sat back and laughed as all the little guys went right down the hole to Wonderland.

But you�re a smart boy, Noah, I daresay a brilliant boy. I know that after 27 trips to the first Bush presidential library at Texas A&M University in College Station, you actually had a meeting with the first President Bush. And now you plan to run for the White House in 2032. And you want Social Security taken care of, because you want to be president by then. Well, your friend Junior can save Social Security quite simply as I outlined in the opening paragraphs. If he goes to privatization, even if only in a small way, a tiny infinitesimal way, it will be the beginning of the end. Once his pals get a foot in the door, they�ll jam it open and loot the system like Ken Lay did Enron.

Social Security�s retirement fund will not only be bankrupt. The program will be gone altogether, especially if the boys find a way to cheat the Trust Fund out of its $1.6 trillion debt holdings in Treasury Bonds. So Noah, dear heart, my advice is, save politics until you get a little older, wiser, and tougher. Right now stick with trivia on the "Tonight" Show and enjoy being nine. It�s a great time of life. Trust me, all things will become clear to you in time, all things. Including who the good guys are and who the bad guys are.

Jerry Mazza is a freelance writer who resides in New York City. Reach him at

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