Tuesday, January 18, 2005

More Rahm Emanuel

I wrote some thoughts on Sunday about what a pathetic job Rep. Emanuel did on Meet the Press. Mine were off-the-cuff remarks suggesting that if this was the best we can do on the issue of Social Security, we are in BIG trouble. There was a lot not to like about Emanuel's performance in addition to how really aggressive Russert was with him as compared to spit and polish Dan Bartlett, but we already know Lil' Russ is against us.

Today Josh Marshall gave the same issue a thorough going over and it is worth a read. I won't improve on what Marshall said except to on the issue of how we communicate as an opposition party he is right on.

Lat night I happened to catch Robert Reich on some show hosted by Pat Buchanan, who I find to be insufferable, but that is beside the point. Reich was great. He was on message both about the lack of a real crisis and how the Democrats ought to be responding. Here is a bite.

BUCHANAN: All right, let me ask you this, Robert. Look, throughout the years, everybody knows Social Security is headed up to the point where it‘s got to be repaired. It seems to me the president is showing a lot of courage in stepping up to this, saying let‘s take a hard look at it, make sure it‘s there for the baby boomers and for their children. Why aren‘t the Democrats helping out?

REICH: Pat, I was a trustee of the Social Security trust fund, so I know what I‘m talking about when I say that there‘s absolutely no crisis here. There‘s no problem. Social Security will be fully funded all the way through the 21st century.

In fact, the Congressional Budget Office, you know, an arm of the Republican Congress, said that Social Security is going to be fully funded up to 2054. Now, there are a lot of problems this country faces before the next 50 years. This is not a crisis. This is not a problem. This is entirely manufactured.

BUCHANAN: Entirely manufactured, not a crisis.

Let me read you something somebody said about seven years ago, President Bill Clinton. Let me read you his quote here. He said, there should be no new spending, or more importantly no tax cuts—quote—and this is Clinton—“before we take care of the crisis in Social Security that is looming when the baby boomers retire.”

Robert Reich, Clinton did nothing about it. We‘re seven years down the road. If Clinton said there was a looming crisis in 1998, why is it wrong for the president to suggest we have a crisis we might want to deal with it right now?

REICH: Well, look, I can‘t—Bill Clinton isn‘t here on your program. I cannot understand and quiz him with regard to exactly why he said what he did.

MATTHEWS: Was that demagogic on his part? Was that demagogic?

REICH: Maybe it was. I can‘t get into his head. I can‘t tell you.

But, Pat, listen to me, I can assure you on the basis of every economic report that I‘ve read, on my own experience, on the basis of my serving on the trust fund of the Social Security trust, I can assure you that there‘s no problem. And it‘s been blown way out of proportion. In other words, there might be way out in the year 2070-something, conceivably, there may not be enough money pay for it. But we‘re talking about so far in the future that it‘s not even worth talking about.

And let me explain to you why. And this is very, very important for viewers to understand.
***
BUCHANAN: That was President Bush last week talking about revamping part of Social Security.
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BUCHANAN: Well, where would you get the general revenues, except by higher taxes or by borrowing, which deepens the debt?

REICH: Well, I‘ll tell you one thing, Pat. You‘re not going to get the general revenues if you require $2 trillion more money into the Social Security system by diverting the money into private accounts. That‘s what is going to happen.

You see, these private accounts are not going to be costless. They‘re going to cost a lot of money. Social Security is a pay-as-you-go system. Today‘s payers into Social Security are supporting today‘s retirees. Where in the world are you going to get the money if you divert all of this money into private accounts. It just doesn‘t make sense. It‘s mathematically impossible.

BUCHANAN: All right, what are you saying? We‘re going to have to tax or borrow to get the money for the private accounts?

REICH: For the private accounts, yes. There will be a deeper deficit or maybe taxes will have to go up. Who knows how the administration is going to pay for it. Private accounts have two—Pat, look, it‘s a dumb idea. Social Security isn‘t in trouble and private accounts are going to cost $2 trillion. The deficit is already out of control.

***
REICH: Medicare is a problem. I‘ll grant you that. And we do have to have Medicare reform. Medicare is going out of money. It‘s going to go bust.

And that‘s exactly what we ought to be focusing on. But Social Security isn‘t a problem. If we have the same kind of economic growth that we‘ve had since the Civil War on average, more than 3 percent a year, Pat, I can show you. I can bore you to you tears with the numbers, but we are not going to have a problem with Social Security. We will have a problem with Medicare.
***
REICH: Well, if you allow people—if you say Social Security isn‘t a problem, but we‘re going to expand the ability of people to put away money in personal accounts, we‘re going to provide more tax benefits, so the average person can create more savings, that‘s great. That‘s wonderful.

In fact, I‘ll give you a better idea. Why not exempt the first $10,000 of income from Social Security altogether and take the ceiling, instead of the $90,000 ceiling? Right now, you don‘t pay any Social Security taxes anything over $90,000. Lift the ceiling so you pay for the difference. So the first $10,000 is exempt. That would give people the opportunity to save. But that‘s not what the administration is talking about.

BUCHANAN: Now, listen, well, there‘s no doubt the polls show 49-40 that the country isn‘t behind the president thus far on Social Security reform. He intends to go all out for this Robert Reich. When he does, if he goes to the wall on this, and he‘s got a Republican Congress, do you think he can win it?

REICH: I don‘t, Pat. At least I don‘t if the Democrats stick to their guns, tell the truth, and make sure the public knows that there‘s no crisis.

Look, in 1994, Bill Clinton, when we really did have a health care crisis, we had 38 million people who have health insurance, Bill Clinton tried to go to the public with a Democratic Congress and sell his health care proposal. And the Republicans said in unison, there‘s no health insurance, health care crisis in America.

BUCHANAN: OK.

REICH: And that really destroyed the entire momentum. Democrats ought to be doing the same thing now.

BUCHANAN: OK.

Robert Reich, thanks. It‘s always a pleasure.


Yep, a pleasure. And that, I believe, is how it is done: don't put up with their nonsense and up the ante on the stuff you can beat 'em on.

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