WUI (Writing under the influence)

Somebody once said we are all Americans, sometimes born in the wrong places.
On a warm autumn day in 1986, while enjoying beer with my college buddies,
I decided to join my new homeland.

I've come to appreciate the ideals that helped create this great country.
Liberalism, political-correctness, multiculturalism and moral equivalence
are destroying it.

This old house Grovenet Wal*Mart Visiting Poland American wine better than French.

Wednesday, March 16, 2005

 

Token conservative

My recent post (the relevant part is at the end) on the GroveNet mailing list was forwarded to John Schrag, the new editor of Forest Grove News-Time and the author of the article in question. Amazingly, he agreed that the article may have been one-sided and that the letters to the editor on the subject of social security were also one-sided. So he invited me to reword my post and send it as a letter. First, I apologized for less than flattering words directed at the paper but explained that this wasn't the first time News-Times seemed to agree with one side of a controversy. I also agreed to write a letter. Lastly, I expressed a wish for a "token conservative" that every major paper seems to have nowadays who would write from time to time on the behalf of the silent majority in our town.

John Schrag mentioned in passing my compliant in his column last week summarizing his first 30 days as the editor.
Similarly, as an on-line critic noted on grovenet last week, too many of our stories rely on a single source and fail to seek out opposing points of view. I agree.

Not only did he agree, he asked me to write a column instead of just a letter on the social security debate. And I did. It was published today. There is no electronic version so I post it here in its entirety.

The only thing they have left is fear itself

“This is a classic case of a solution in search of a problem.” This is what Congressman Wu has said about President Bush’s proposal to allow younger workers to divert some of their payroll taxes into voluntary personal accounts. Indeed, the Democrat flatly rejects that the social security program is in crisis and in need of a major overhaul.

It is very disingenuous of the Congressman to say this about the program that, after running deficits for 7 straight years between 1975 and 1981, had to be resurrected from near bankruptcy in 1983. Each time social security ran into trouble it was “fixed” by raising taxes. Changes may have been incremental but the program today is far from the retirement insurance system FDR created 70 years ago when only the first $3,000 was taxed at the rate of 2%.

Wu says that any problem (I didn't think there was a problem) can be fixed by making workers more productive. Supposedly, higher productivity would result in higher wages. The higher the wages the more money would go to the social security program.

There is one fundamental flaw with this reasoning. As the Congressman very well knows, social security benefits are indexed to wages so if the wages go up so will the benefits. So to pump more money into the ailing program, Democrats would have to raise the cap ($90,000) or the rate (12.4%) or both, resulting, yet again, in higher taxes. But how much more can we tax our incomes before the social security program brings down the whole economy?

The answer already exists. Germany, where a social security program was introduced by Otto von Bismarck in 1889, is today in dire economical straits. It has the highest unemployment (12.5%) since the 1930s and its economy will be lucky not to shrink this year. With already high taxes, high unemployment and stagnant economy, German government struggles to maintain the promises of its numerous welfare programs. But Congressman Wu hopes that following the same policies in the US will bring different results. As Albert Einstein once famously said, it is insanity.

When all other arguments fail, Congressman Wu resorts to Democrats’ favorite persuasion technique: can’t reason with them, scare them. By painting dramatic pictures of retirees losing their money on the stock market just when they need it for their retirement, Wu prefers to keep his constituents frightened and ignorant so they blindly keep on voting for the misguided policies he advocates. No wonder almost every day I encounter seemingly intelligent people who have no clue how safe long-term investing is if one follows a few simple rules (hint: ENRON employees didn't follow those rules.)

Social Security will have to be reformed without raising taxes. The reform should include indexing benefits to inflation. Younger workers should have the option of investing part of their payroll taxes in personal accounts so they can take more responsibility for their retirements.

So why would Congressman Wu oppose this and many other President Bush’s policies? Tax cuts (for the rich) have helped the economy recover from almost uninterruptible stream of adversities. Aggressive foreign policy is bringing freedom to the Middle East and security to the US. But it is the idea of ownership society -- educated people breaking the shackles of dependency on the government with financial freedom to live their own lives -- what Congressman Wu and other Democrats fear the most. They are stuck obsessing about past, blinded by partisan zeal. The party of New Deal has become the party of No Deal.

News-Times changed my title to "Fear on Social Security is party line for Democrats."

Comments: Post a Comment

Links to this post:

Create a Link



<< Home

Archives

October 2004   November 2004   December 2004   January 2005   February 2005   March 2005   April 2005   May 2005   June 2005   July 2005   August 2005   September 2005   October 2005   November 2005   December 2005   January 2006   February 2006   March 2006   April 2006   May 2006   June 2006   July 2006   August 2006   September 2006   October 2006   November 2006   December 2006   January 2007   February 2007   March 2007   April 2007   May 2007   June 2007   July 2007   August 2007   September 2007   October 2007   November 2007   December 2007   January 2008   February 2008   March 2008   April 2008   May 2008   June 2008   July 2008   August 2008   September 2008   October 2008   November 2008   December 2008   January 2009   February 2009   March 2009   April 2009   May 2009   June 2009   July 2009   August 2009   September 2009   October 2009   November 2009   December 2009   January 2010   February 2010   March 2010   April 2010   May 2010   June 2010   July 2010   August 2010   September 2010   October 2010   November 2010   December 2010   January 2011   February 2011   March 2011   April 2011   May 2011   June 2011   July 2011   August 2011   September 2011   October 2011   December 2011   January 2012   February 2012   March 2012   April 2012   May 2012   June 2012   August 2012   September 2012   October 2012   November 2012   January 2013   February 2013   March 2013   May 2013   July 2013   September 2013   October 2013   November 2013   December 2013   January 2014   March 2014   April 2014   May 2014   June 2014   July 2014   August 2014   September 2014   October 2014   November 2014   December 2014   May 2015   September 2015   November 2015   December 2015   March 2016  

This page is powered by Blogger. Isn't yours?