Bush Advisers OK Social Security Plan

http://story.news.yahoo.com/news?tmpl=story2&u=/ap/20050128/ap_on_go_pr_wh/social_security

President Bush's advisers have settled on a proposal for structuring the personal accounts they hope to create in Social Security, while on Capitol Hill Senate

Under a plan recommended to Bush, the private accounts would resemble many company-sponsored retirement plans, with just a handful of investment options. By default, workers would be enrolled in a "life cycle" account, in which investments become more conservative as investors age, if they do not choose one of the other options, according to two officials speaking on condition of anonymity.

On Friday, Senate Democrats were to hold a session aimed at showcasing the problems with Bush's overall plan to let workers divert a portion of their Social Security taxes into individual accounts that could be invested in the stock market. Among those testifying before the panel were a pair of workers from the Social Security Administration (news - web sites) complaining that the employees are being used for political purposes to sell the Bush plan to the public.

"The president is certainly going to use his megaphone to convince people this is a crisis, and he's dead wrong on that," said Sen. Byron Dorgan (news, bio, voting record), D-N.D., chairman of the Democratic Policy Committee, which works to promote party policies on the Senate floor and is sponsoring Friday's session. "We have to make the case that he's wrong."

meaning that people that buy bond funds will suffer when rates rise.

These lifecycle accounts do not have a "guarantee element".

I still think this is all a set-up for a Value Added Tax when this appraoch is defeated.

<http://www.omaha.com/index.php?u_pg=1638&u_sid=1320317>
from todays buzzflash....

Nice :headbang:

More conservative than what?

remember this wording next time a Bushbot tries to tell you there's no risk involved in the new SS plan.

"Just a handful of investment options." People think they're actually going to be given money, and they're clueless that the money that's now taken from them will still be taken and will just be placed somewhere else, with choices controlled by the government. But "it's YOUR money"! Idiots.

It's not OK.... it's ok when WE THE PEOPLE say it's ok.

that was the expected response from them :-(

The "private" accounts morphed into "personal" accounts. Apparently, the focus group connected 'private' with corporate pirating.

Sometimes I wish I were 80 or 90 years old because, unless this country gets back on track, I'm certainly not looking forward to living the next 30-40 years.

You are NOT going to gut social security with your fake crisis and your fake "privatization".

Not now. Not ever.

$5000 is a tiny amount for a retirement fund - someone paying 4% of their $30,000 salary would build that up in about 4 years; and it would provide on the order of $300 a year pension. The vast bulk will be that 'second tier', which this story seems to say will be put into mutual funds - at their present management charges, no doubt. If Bush starts going on about the low charges his scheme would have, check whether they're available for all investments, or just that first $5000.

decisions of an appointed Board overseeing the accounts can be changed--ultimately, to allow Wall Street "management fees" to soak up a full 20 percent of FICA. The 20 percent figure comes from Peter Diamond of MIT, probably the world's foremost expert on the economics of privatizing Social Security.

Most likely, Wall Street will keep pretty quiet about the alleged benefits of privatized Social Security for workers initially, then jump in with tens of millions of dollars of lobbying and ads once the White House plan has gathered some steam, then insist on leaving details like this vague in the basic legislation, and finally pounce on the regulation and oversight process once vague legislation has passed.

:kick:

So he could use surplus money in SS system to pay back war costs?

Many people will be at mercy of Predatory Stock Markets and The Wall Street Wolves with Bush's SS Plan, wouldn't they? :eyes:

Bryn

The title has PRIVATE in it. That's good- the WH HATES the term:bounce:

President Bush's advisers have settled on a proposal for structuring the personal accounts they hope to create in Social Security, while on Capitol Hill, Senate Democrats were launching an effort to defeat the plan altogether.
...
Yet to be decided are several big questions, including how large the private accounts should be, how much guaranteed benefits would be cut and how to pay as much as $2 trillion needed in the first 10 years to effect the transition to a new system.
...
The government would be responsible for keeping track of how much money is in each worker's account and give the lump sums to a financial services company to invest, a mechanism aimed at keeping administrative fees low, they said.

That would mean only a limited profit potential for Wall Street. More money might be available for industry if a second tier of investments were permitted. Under this model, once a worker's account reached a certain level, he or she could choose from a broader range of investment options. Any number of mutual funds could be approved for investment at this stage.

http://www.washingtonpost.com/wp-dyn/articles/A44525-2005Jan28.html

Oh, those pesky minor details...

...how large the private accounts should be, how much guaranteed benefits would be cut and how to pay as much as $2 trillion needed