Baseball Crank
Covering the Front and Back Pages of the Newspaper
February 9, 2005
POLITICS: Alternatives

Gerry Daly on Kevin Drum and the Democrats and their approach to Social Security:

I have a simple question for Mr. Drum. The last time I checked, Democrats can still introduce legislation. They may not have the votes, but they can introduce their own plans. If they are unified and can peel off some Republicans such as Lincoln Chaffee, Olympia Snowe, and Susan Collins, they might even be able to pass something. And if it does not pass, they will be able to point to their plans during the next election cycle. Why are they not doing so?

Let me answer my own question with a guess. The reason is because Democrat politicians believe that their preferred alternatives would be political poison. Keep the death tax and roll back the Bush tax cuts? Sounds like a plan for cementing the view of the Democrats want to raise taxes. How about private Social Security accounts as an add-on? Most people have something already (401-k plans, IRAs)- and it would send a disasterous (for Democrats) message: private accounts are good, and those who can afford it can have them, but those who are barely getting by, you are out of luck . . .

The main obstacle to Democrats' alternatives to Bush's reform proposal is not Republican objection, but rather fear of voters. Especially on the matter of raising taxes; voters just went to the polls after the Democrats ran against Bush's tax cuts, and Democrats lost.

So the Democrats are reduced to making incoherent arguments:

It's George Bush who's insisting on a private account plan that even his own people admit won't do anything to shore up Social Security's finances. It's George Bush who's insisting that the only cures he'll consider are ones that include huge - but quiet - benefit cuts...

The facts: Social Security has modest problems that are many decades out. They could be easily solved with small benefit cuts combined with small tax increases.

If "small benefit cuts" are part of, in Mr. Drum's analysis, an 'easy' solution, then how can it be that Bush's plan "won't do anything to shore up Social Security's finances" when it includes "huge - but quiet - benefit cuts"? If benefit cuts are part of a solution to shore up Social Security's finances, wouldn't a plan that includes benefit cuts at least be doing something towards that end, directly contradicting the "won't do anything" claim? And if private accounts "won't do anything to shore up Social Security's finances", then why would Democrats be "happy to support add-on private accounts"? Do the Democrats often support things that don't do anything (or at least, that they think won't do anything)? Or do the Democrats think that private accounts have some positive, desirable benefit? What might that benefit be, and could it be part of the reason they are in Bush's plan?

[snip]

The Democrats could negotiate with the American people. They could do so by offerring their own detailed plan. If Republicans blocked it, then Democrats could use that during campaigns. What the problem for the Democrats really is, is that their solutions are distasteful to Americans. As such, the Democrats are pretty much stuck with a strategy of trying to claim there is no big problem (contrary to things that party leaders like Bill Clinton had been saying for the last decade) and trying to make sure that people do not understand the President's plan and how the two parts of it (the indexing change and the private accounts) fit together.

. . . Reid was arguing that he did not object to having some portion of Social Security money invested in the private sector, but that he did object to letting individuals do it:

REID: Well, but, see, that's easy, Tony, to throw those words out. My father, probably as smart as any of the three of us, but he had no education. My father never graduated from the 8th grade. And to think he can invest his own money, he couldn't do that.
This highlights one of the main reasons that Democrats will not offer "Bill Clinton's proposal for the government to invest part of the Social Security trust fund in the stock market" (Drum's description). The argument for that as opposed to Bush's personal accounts boils down to who do voters trust with their money- themselves, or government? The Democrats, or at least Reid, take the position that government is to be better trusted than individuals. The Republicans position is the opposite. This difference in political philosophy has been a theme of the past few elections, and the Democrats have not liked how those have turned out.

And on a side note to my side note, I cannot help but wonder about something. If Senator Reid, from Nevada, thinks that the President's proposal for individual private accounts amounts to "gambling", and that this is bad because there are those who have lesser education who couldn't make good choices, then why is he not trying to get gambling either outlawed in Nevada, or at a minimum pushing for some sort of means testing whereby those who cannot afford to gamble or are less bright than most are prevented from doing so?

(Emphasis mine; read the whole thing). Meanwhile, as if to cement the negative perceptions of Democrats on this issue, Dales points out that the governor of New Jersey is planning to tax 401(k) contributions.

Posted by Baseball Crank at 7:16 AM | Politics 2005 | Comments (6) | TrackBack (0)
Comments

I don't trust my own knowledge of Social Security enough to get into a debate on the merits, so I'll limit myself to political comments:

1) Bush hasn't even fully released his own plan yet. Can we wait for that before we get on the Democrats' case for not having an alternative?

2) If the Bush administration has demonstrated one thing in their tenure, it's that they have NO interest in compromise. Given that, why should the Democrats propose anything? It won't influence the Republican plan, it will just give them something else to attack. Let the Republican plan run aground, THEN try to come up with something better.

3) Given that Bush needs some Democratic support to get this through the Senate, and that at this point there's very little indication he'll be able to get any, a lot of the Republican rhetoric I'm seeing, about how the Democrats are destined to lose, strikes me as BS. At the moment, the Republicans aren't winning, and saying otherwise isn't enough to change that.

Posted by: Devin McCullen at February 9, 2005 9:50 AM

Nice work Devin, couldn't have said it better myself.

Posted by: Mr Furious at February 9, 2005 10:23 AM

Bush at least is addressing an upcoming problem. The Democrats right now are perceived as having no solutions. Refusing to come up with any alternatives only cements this idea.

Posted by: Robert at February 9, 2005 3:28 PM

Devin -

1. I agree with you that there's no need for the Dems to have a plan rolled out now. But I think Gerry's right that they will have real problems if they don't present a counter-proposal at all once the GOP plan is on the table. They may be trying to follow the Gingrich/Gramm model on HillaryCare, but the GOP's theme was that an all-encompassing federal health insurance program was a bad thing and not needed. For the Dems to follow a similar "just say no" strategy they need to argue that the present system is sustainable as is, and/or that there's no fiscal consequence to waiting four more years to do anything.

2. Because they are then acknowledging that they don't have a better idea.

3. I don't think that who's winning is at all clear yet. I agree that getting Dem senators to sign on and GOP Members/Senators to hold the line will be hard. The fact that the end result is not yet inevitable is precisely why it matters whether the Dems present an alternative or not.

Posted by: The Crank at February 9, 2005 4:15 PM

If Bush doesn't compromise, then why did all those Democrats vote for Kennedy's education plan, CFR and the tax cut (remember, 12 Democratic senators voted in favor)?

Wasn't the idea to represent constituents instead of a party?

Posted by: Ricky at February 10, 2005 12:40 PM

Polls indicate that a large majority favour removing the $90,000 cap on payroll taxes: if we combine this with a proportionate *increase* in projected benefits for those earning over the cap, then the great majority of the projected 'underfunded liability' disappears and very modest future cuts, if any, are required.

Hence, no political suicide. You don't even have to say 'reverse the tax cuts': just say 'remove the cap'.

Only an utter hack would ask the Democrats to come up with a plan when the President hasn't got one himself - or if he has no-one knows about it. Since the "Bush plan" is so incoherent, it's also rather silly to expect coherent critiques of it, from Democrats or anyone else. There is a 'Graham Plan', to be sure, but no-one will vote for that because it's so much worse than doing nothing.

Your quoted post makes valiant efforts to misrepresent various people. First, Drum said that the private accounts would not help the SSA's finances. Which is completely correct. Gerry Daly misrepresents that as saying 'benefit cuts will not help the finances'.

Next Reid. The question is not, should gambling be allowed with the part of your income that is not taxed at source, the question is, should it be *mandatory* to gamble with what used to be your Social Security contributions. Harry Reid seems to understand the difference.

I'm afraid you also mistake the role of Social Security in the average person's consciousness. Security means that you can come back to it even after you screw up everything else. It's not all that much but it is *guaranteed* to be there. The only entity that can provide such a guarantee is the government.

I think people understand the value of having a 'mixed economy' in their plans for retirement. Social Security is a very popular programme just as it is, which is a Socialist scheme. That's what Socialism is, when the government forces you to use your money a particular way rather than letting you play with it. And people like it in small doses.

This is a winner for Democrats if they can find the right language. Obviously, 'socialism' is not part of that... ;)

Posted by: Thomas Dent at February 10, 2005 8:09 PM
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