Social Security "Reform":
Stop This Huge Attack in Its Tracks!

Jan 10, 2005

In a memo to Republican lawmakers that was leaked to the press on January 5, Peter H. Wehner, the Bush administration’s Director of Strategic Initiatives, described the White House plans for the upcoming fight to "reform" Social Security.

The memo confirms that the Bush administration intends to cut Social Security benefits by as much as 40% over the next decades.

The memo then gives the broad outlines of the Bush administration’s campaign to convince the public to accept this enormous attack. The message the White House will try to convey is that "we are on an unsustainable course... the current system is heading for an iceberg... the notion that younger workers will receive anything like the benefits they have been promised is a fiction, unless significant reforms are undertaken."

To get that message across Wehner proposed: "We will focus on Social Security immediately in this new year. Our strategy will probably include speeches early this month." He ends by saying, "That reality needs to be seared into the public consciousness; it is the pre-condition to authentic reform."

In other words, the public is about to be bombarded by the entire spectrum of the political establishment, including bi-partisan, high-minded sounding organizations like the Concord Coalition, and all the other self-proclaimed experts whom the news media will feature non-stop from now on. They will tell us over and over again that Social Security is in crisis. This is what they will try to " sear into the public consciousness."

A Campaign of Lies

From beginning to end, everything they will say is a complete lie.

Lie Number One has already been exposed by this memo: the assurance by Bush and everyone else that their "reform" of Social Security won’t cost future retirees anything. No, they plan on cutting benefits by 40%.

Lie Number Two is that Social Security is running out of money, that "it is heading for an iceberg." No, it is not. Social Security is NOT running out of money. Not even the official reports of the Social Security Administration and Congress dare claim this. At most, they say there might be a possible small shortfall in 40 or 50 years, which is not exactly around the corner, as Bush and others want us to believe. And as many economists have pointed out, even these predictions are very slanted, based on the assumption that over the next half century there won’t be appreciable growth in the economy, employment or productivity, which is highly unlikely. This is why many economists say that there won’t be a shortfall in Social Security.

Bush will tell us that all he wants to do is to "save" Social Security. Of course, if that were really the case, he wouldn’t break up Social Security into private individual accounts, privatizing Social Security. That’s the worst thing to do. Much of the money in those accounts would be eaten up by Wall Street companies, charging big commissions and fees... every single year. On top of that, many people will watch their holdings decline when stocks go down, as people with 401(k)‘s learnt so painfully during the recent stock market dive.

Giving Social Security to Wall Street won’t save Social Security for retirees. But it would hand hundreds of billions and trillions of dollars over to the big financial corporations so they can speculate with it and profit from it for themselves.

This would transform an entitlement which pays a pension for as long as a person lives into the equivalent of a 401(k) account that will very often run out of money and stop making payments long before someone dies.

This is a huge, across-the-board attack on the single most important gain that working people won over the course of many, many decades of struggle.

Won in struggle it will be defended the same way

This gain, the right for anyone who worked to have a pension, was won in the big workers’ struggles of the 1930s, the same struggles that built big unions for the first time in the major industries. Over the next decades, especially as a result of the widespread black movements from the 1950s into the early 1970s, Social Security was both extended to more sectors of the population and the benefits were boosted. By the early 1970s, for example, an automatic cost-of-living clause was added, giving seniors a small, but obviously very vital protection from inflation.

As these struggles receded starting in the 1970s, what had been won came under attack. In 1977, under Jimmy Carter, the inflation coverage was partially reduced. In 1983, with Reagan as president and the Democrats controlling Congress, a cost of living increase was delayed for six months and the retirement age boosted. In the 1990s, Clinton introduced a sneaky cut in benefits, by twice revising down the cost of living formula. These benefit cuts may not have been obvious then, but they have built up over time.

Then in the late 1990s, after Clinton was re-elected for his second term, he began to talk about carrying out many of the same kinds of reforms that Bush is pushing today at the beginning of his second term. This so-called reform has been in the works for a long time, and support for it has never strictly come from the Republican party, but from the Democratic party as well. The person Bush appointed to head his commission that recommended privatizing Social Security and handing the money over to Wall Street was the Democratic liberal from New York, the late Senator Daniel Patrick Moynihan.

What has kept both Republican and Democratic politicians from carrying out this outright attack has been the fear that it could provoke a huge reaction from the population. In fact, Social Security has been called the "third rail" of American politics. Even today, after decades of relative social quiet, even after so many big attacks against the population have succeeded, the politicians still fear that they could awaken a hornet’s nest by beginning to dismantle Social Security. According to the Wall Street Journal of January 6, Republican legislators told Bush’s main political advisor, Karl Rove, that "they were scared to death" of what would happen if they supported such a measure.

Every time a politician says he or she wants to save Social Security, watch out they are preparing to attack it. Every time they say they want to reform it, working people should get ready for battle. They want to take it from you.

If our grandparents and great grandparents in the 1930s were able to fight to win Social Security, we ought to be able to step up and fight to keep it.