Social Security
TAX PAYER DOLLARS to BAIL OUT the "Privatized" "Ownership" funds
over:
$221,000,000,000.00
Something is very wrong here, and it is the decisions of Mr. Bush.
So far, it is OVER $221.2 Billion of OUR TAX PAYER DOLLARS to BAIL OUT the "Privatized" "Ownership" funds. In the following articles you will see just how DANGEROUS private, owened, retirement funds can be.
I also note, the "CEO's" and others who have been found guilty of embezeling (stealing) from these funds, they do not go to prison and seldom pay back any of their "gain".
Bush of course wants to END or at least REDUCE the PENALTY'S for corporations or people who may be guilty of these crimes.
23 Billion + $80 billion + $1.6 billion + $109 billion + $6.5 billion + $198.1 Billion = $221.1 Billion.
Social
Security
All things are related, and the wrongful
idea to "Privatize" virtually everything is one of them. Social Security was
designed to provide security during times of economic discord, such as when the
Stock Market flops. To “Privatize” Social Security and place the monies for
retirement and necessary health care in the stock market completely defeats the
“secure” part of this protection. Designed after the crash of ’29, it was
necessary to assist people so they could get necessary medical care and shelter.
An example, the recent stock market “crash”
lost many peoples savings and planned retirement monies. Indeed, President Bush
has appropriated monies to help
corporations pay the “benefits” to their recipients.
But how about the rest who lost vast sums in this crash? Also, the corporations
will keep “the stock” and eventually receive huge dividends when these stocks
recover.
Social Security has for years received more
revenue than was used. The government of course had no conscience to place these
funds into the General Account and spend away as if this was extra tax revenue.
This money is “owed” the SS Trust fund Now however, it balks at supplementing
SS, however gifts corporations? Below Bush gift’s corp’s $81.6 BILLION Dollar!
If Bus didn’t “give away” to his corporation welfare recipients, we could have a
good basis for Social Security.
Something is very wrong here, and it is the decisions of Mr. Bush. eggy
1. A Warning For Social Security "Reformers"
2. Bush OKs Pension Aid to U.S. Companies
3. Pension Benefit Guaranty Company
4. AARP Opposes Bush Plan to Replace Social Security With Private Accounts
5. Goodbye, Pension. Goodbye, Health Insurance. Goodbye, Vacations.
A Warning For Social Security "Reformers"
Bernard Wasow
The Century Foundation, 11/17/04
While the administration is preparing its drive to replace part of Social Security with private investment accounts, an obscure government agency is planning to go to Congress to ask for a bail-out. The Pension Benefit Guarantee Corporation (PBGC), which guarantees private pension plans, just announced that its net liabilities are double earlier estimates, more than $23 billion. (WOW Government (OUR MONEY) bailing out Bushkies “Private” “Ownership” funds? Why not stay with ol Social Security? eggy)
"…it is imperative that Congress act expeditiously so that the problem doesn't spiral out of control," said PBGC executive director Bradley D. Belt. These net liabilities are likely to balloon to much higher levels if troubled airlines continue their slide into bankruptcy.
Are Social Security privatization and trouble at the PBGC related? You bet. The trouble at the PBGC illustrates the great risks involved in retirement planning, risks that have swamped enough private pension plans to require a Congressional bailout. Yet the Bush administration is proposing to wind down the only part of retirement income that is secure—guaranteed against the business cycle, inflation, and corporate malfeasance—and replace it with risky private accounts, with no guarantees at all.
When Social Security was introduced in 1935, it was understood that public pension benefits would never provide a comfortable retirement income. Private pensions and private saving would constitute the other two legs of the "three-legged stool." Nearly 70 years later, with average Social Security benefits at about $10,000 per year, Social Security can hardly be called generous.
Private pension plans still are essential to a decent retirement, but they increasingly are moving away from guaranteed benefits (and even these guarantees were subject to change) toward employers' contributions to employees' saving for retirement. Among the remaining "defined benefit plans," enough have gone belly up to create the crisis at the PBGC. Traditional private pension plans—at Pan American Airways, Bethlehem Steel and other failed companies—are sufficiently underfunded that Congress is being called in to bail them out.
Individual private accounts are no more secure than the pension accounts set up by companies to pay traditional retirement benefits. Some private accounts will crash and burn, just as some corporate accounts have proved inadequate. In fact, there is every reason to believe that individual private accounts will on average produce lower returns than professionally managed corporate pension funds.
The demise of Enron illustrates these risks. Not only were employees blindsided by the collapse of their high-flying employer, but a large group of them had accumulated unbalanced 401k individual retirement accounts, heavily invested in Enron. Their retirement accounts went up in smoke at the same time as they lost their jobs. Couples on the verge of retirement saw their private retirement accounts lose hundreds of thousands of dollars in days. All they had left was Social Security.
Even a well diversified retirement account cannot avoid the fluctuations that knock 20 or 30 percent, or more, off the value of the market every few decades. Anyone who had to postpone their retirement after the dotcom bubble burst in 2000 is still waiting for the market to recover.
The bankruptcy of the PBGC, with its anxious call for a Congressional bailout, should send a clear signal to the debate about Social Security: we still need social insurance to guarantee a minimum retirement income. Private accounts produce too many risks, too many surprises, for us to count on them as a replacement for Social Security guarantees.
Bernard Wasow is a senior fellow at The Century Foundation.
http://tcf.org/4L/4LMain.asp?SubjectID=4&ArticleID=774
Bush OKs Pension Aid to U.S. Companies
4/10/2004
CRAWFORD, Texas (Reuters) - President Bush signed into law on Saturday a measure aimed at saving U.S. companies more than $80 billion in pension contributions over two years, days before many firms make quarterly payments.
Businesses lobbied hard for the bill, which would provide about $80 billion in pension accounting relief through the end of 2005 for some 31,000 companies with traditional "defined benefit" pension plans. Those cover about 35 million workers and promise a specific payout based on salary and service.
Many traditional pension plans are underfunded because of the weak stock market the last few years and current low interest rates, and companies are struggling to keep up with the payments as profits have shrunk in part because of the struggling economy.
The relief comes from replacing a formula for calculating pension contributions. None of the aid comes from government payments.
The law goes into effect in time for the next round of payments, set for Thursday, and is intended as a temporary measure to help keep plans afloat while Congress works on longer-term pension reform.
There would also be $1.6 billion in extra relief through waivers of payments for a handful of steel companies and major U.S. commercial airlines particularly hard hit in recent years, such as bankrupt United Airlines, a unit of UAL Corp. <UALAQ.OB These companies would receive waivers for payments.
Some Democrats were angered by the legislation because it contained little help for plans sponsored by more than one employer, which cover mostly union workers like in the construction and trucking industries.
Massachusetts Democratic Sen. Edward Kennedy said less than 4 percent of the 1,600 multi-employer plans, which cover more than 9 million workers, now qualify for help.
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http://www.boston.com/business/articles/2004/04/10/bush_oks_pension_aid_to_us_companies/
Pension Benefit Guaranty Company
Corporate bailout looms in pensions
The Pension Benefit Guaranty Company, the federal agency that insures corporate pensions for 43 million workers, is likely to go broke by 2020, according to an independent analysis reported last week in the New York Times.
If the agency indeed goes broke, either taxpayers will have to spend an estimated $109 billion to bail it out, or millions of Americans could wind up without their guaranteed pensions. Either way, Americans will be left to clean up a mess left by large corporations not making good on their promises to provide pensions. Many large corporations are falling increasingly short when it comes to the money they have put aside in their pension plans for employees.
In other pension news, reports indicate that IBM is getting close to settling a lawsuit that charges that the company discriminated against 140,000 older workers by changing its pension plan in the 1990s. Compensating the employees for lost pensions could cost $6.5 billion.
WASHINGTON - US Airways, trying to raise money and avoid liquidation, has asked a judge for permission to skip a big pension payment due this week.
This is its first move since filing for protection against creditors over the weekend.
The No 7 US airline, which filed for its second bankruptcy in as many years on Sunday, got permission to continue operating using money from a loan it secured last year with the help of Government guarantees.
But US Airways told the court it cannot make the US $110 million ($170 million) payment due today for pension plans covering members of the International Association of Machinists and the Association of Flight Attendants, and it may ask to terminate those plans.
"The debtors believe they would not be able to meet their obligations under the pension plans and survive," the company said.
US Airways aims to slash its costs and become more like the discount airlines that threaten its survival.
US Airways has said it must cut costs by $US 1.5 billion. It hopes to get $US 800 million from unions that yielded nearly $US 2 billion to help the airline out of its first bankruptcy.
"We're still talking, we talk every day, we're still working hard," chief executive Bruce Lakefield said outside court about so-far-unsuccessful efforts to win concessions from the unions.
Lakefield did not rule out the possibility that labour contracts could be rescinded if the talks fail but the court would have to agree.
Conservatives, Keep Your Hands Off My Social Security
"The real danger is not that Social Security is unsound, but that its enemies might convince the public to accept "reforms" that would destroy it. Who are the enemies? They are the ideologues and the selfish. The ideologues would eliminate government programs in the name of ideological purity. The selfish lust after the fortunes to be made if even a small portion of Social Security were "privatized." Neither group is concerned with the consequences of their actions for others." (Max J. Skidmore, "Social Security and Its Enemies: The Case for America's Most Efficient Insurance Program" - Westview Press, 1999)
"The social security program was initiated in 1935...The program has become so well accepted that it is somewhat difficult to remember that a little over a quarter of a century ago, when it was first proposed, there were many people who doubted whether it was economically possible or socially desirable or whether it could be made to work at all." (Eugene J. McCarthy, "A Liberal Answer to the Conservative Challenge" - 1964)
Today employed workers in America are eligible for coverage of the most successful insurance program in the history of this country whereas initially, only about 60% were covered and while the age has been increased recently most Americans age 65 or over either are drawing benefits from Medicare or will be eligible when the worker retires, whereas, in 1940 only 8 percent of all Americans over 65 were eligible for such benefits. We have come a long way, not as far as many other countries in the industrial world, but we have made strides toward providing a safety net - until George Bush became president. Not only has social security benefits not kept pace with the cost of living, but since Dubya, the premium cost to social security recipients has increased more than it ever has since it's inception in 1935.
"The original Social Security Act covered only employees working in industry and commerce....coverage has been extended to workers in nearly all kinds of employment, and also to the self-employed, including those who work on farms and in private households, in government, and in private nonprofit organizations. Legislation passed in 1956, which brought members of the uniformed services into the program..." (McCarthy)
Social Security has played a significant role in meeting many of the basic needs of the disabled. There are also provisions for the needy and social security provides an essential safety net. Today, everyone benefits from the social security program. To turn back these gains would be a national disgrace.
The program has been violently opposed by conservatives, not only when it was first introduced, but ever since, with numerous efforts to end it, reduce it's effectiveness, privatize it, and effectively gut it.
"When the social security program was first proposed, spokesmen for organized business, and conservative members of Congress, attacked it vigorously. They argued that social security would bring about the collapse of capitalism and the American system of government. It would lead to socialism, to government control of industry and the lives of citizens. It would, said James L. Donnelly of the Illinois Manufacturers' Association, destroy initiative, discourage thrift and stifle individual responsibility. Unemployment insurance would relieve people of the necessity to make a living; old age and survivors' insurance would relieve them of the necessity of saving money for retirement. Furthermore, some questioned whether the system could operate on a sound financial basis." (McCarthy)
"Some of the most outspoken members of the House of Representatives were Republicans from the state of New York. They were disturbed not only by the economic aspects --the payroll tax and the government's role--but about a proposed requirement that wage earners be fingerprinted." (McCarthy)
"New York Congressman Daniel Reed warned: "Then the lash of the dictator will be felt, and 25 million free American citizens will for the first time submit themselves to a fingerprint test and have their fingerprints filed down here with those of Al Capone and every jailbird and racketeer in the country. That is what it means, and it means that no man can go to an employer and get a job until he goes there with a card issued by the Bureau and can answer the questions and prove that he has been fingerprinted; and if he is not, and they employ him, he is subject to a fine of $1,000 or 5 years imprisonment, or both. That is what you are trying to do in this bill, and it is in harmony with the dictatorship program launched under the New Deal and to be carried on by it. It is carrying out a program of Karl Marx from beginning to end, the domination of the citizen and the destruction of private industry. This is only one more effort under a dictatorial program to regiment labor and make them submit themselves to this federal test before wage earners can go to an employer and get a job to earn their daffy bread." (McCarthy)
"...New York Republican Congressman, James W. Wadsworth, stated: "This bill opens the door and invites the entrance into the political field of a power so vast, so powerful as to threaten the integrity of our institutions and to pull the pillars of the temple down upon the heads of our descendants. . . ." (McCarthy)
The record ....is a solid historical repudiation of these arguments.
Roosevelt, by implementing programs in his "New Deal" essentially established an extensive safety net which was referred to as a "second bill of rights."
"Notwithstanding continued lip service to freedom of enterprise and rugged individualism, Americans have in practice accepted the doctrine that in a modern industrial economy, where most workers are wholly dependent on their jobs with gigantic corporations, it is the government's solemn responsibility to see that no man starves and that the basic rights of all men are adequately protected. Thus the right of workers to organize, flouted by employers for over a century, was made the law of the land; the benefits of social security became the essential right of nearly all who needed them; and the goal of economic democracy was stated and sanctioned as a worthy ideal." (Charles A. Madison, "Leaders and Liberals in 20th Century America" - F. Ungar Pub. Co., 1961)
"The only true threat facing the system--apart from possible problems with Medicare--comes from a skillful and well financed propaganda campaign, a campaign that has convinced many citizens and policymakers that Social Security is in dire need of reform--that it must be "saved." A close look at most major "reforms" reveals that they are clever attacks designed to demolish the world's most successful and most efficient income-maintenance program." (Max J. Skidmore)
Roosevelt's New Deal, which included social security, unquestionably altered the relation of government to the people and conservatives have been trying to turn back the clock on the social gains of that New Deal ever since.
Keep Your Hands Off My Social Security!
http://www.g0lem.net/PhpWiki/index.php/SocialSecurityLiberalism
AARP Opposes Bush Plan to Replace Social Security With Private Accounts
By ROBERT PEAR
Published: November 12, 2004
WASHINGTON, Nov. 11 - Gearing up for battle over the future of Social Security, AARP, the influential lobby for older Americans, said Thursday that it opposed President Bush's plan to divert some payroll taxes into private retirement accounts. But it supports new incentives for private accounts that supplement Social Security.
Working closely with Congress and the White House, AARP helped shape legislation adding drug benefits to Medicare last year. Social Security is an even bigger issue, politically and financially, and lawmakers said Congress was unlikely to make major changes in Social Security over the organization's objections.
Marie F. Smith, president of the organization, said, "AARP adamantly opposes replacing any part of Social Security with individual accounts.'' But Ms. Smith added that the group supported incentives for people to establish personal retirement accounts in addition to Social Security.
John C. Rother, the organization's policy director, said, "We favor private accounts when they are in addition to Social Security, but not as a substitute.''
The fight over Social Security, pitting Mr. Bush's vision of an "ownership society" against the Democrats' determination to preserve a cornerstone of the New Deal, is reflected in a battle over the proper terminology.
The White House dislikes the word "privatization,'' which it sees as a misleading and imprecise way to describe Mr. Bush's ideas for Social Security. Democrats insist that the term is accurate.
E-mail messages circulated within AARP in recent weeks indicated that the group would avoid the word whenever possible.
One message, by an editor of an AARP magazine, says, "There is a new forbidden word at AARP: Social Security privatization.''
Another e-mail message, by a manager of its Web site, says, "The term 'privatization' is stricken from our vocabulary forever.''
David M. Certner, the organization's director of federal affairs, said "privatization'' had no fixed meaning or definition. To some people, he said, it means "getting rid of the entire program'' - a goal not favored by the White House.
Martis J. Davis, a spokesman for the organization, said it was sensitive to the views of younger workers and retirees.
"Younger people think private accounts make sense,'' Mr. Davis said. "Polls by some organizations suggest that young people believe in flying saucers more than in Social Security. We have a problem with that. We don't want to end up being perceived as dinosaurs, and we don't want to be labeled as greedy geezers, because we are not.''
In interviews this week, three Republican members of Congress - Representative E. Clay Shaw Jr. of Florida and Senators Lindsey Graham of South Carolina and John E. Sununu of New Hampshire - said Mr. Bush would make a major effort next year to overhaul Social Security.
"The election results have given new life to proposals for Social Security reform,'' Mr. Graham said.
Mr. Sununu said, "The president is very committed to an approach based on personal accounts.''
House Democrats have begun to devise a strategy to oppose private accounts.
"Privatizing Social Security will divert trillions of dollars from the trust funds and force significant benefit cuts,'' said Representative Robert T. Matsui, Democrat of California.
In general, Social Security payroll taxes are credited to the Social Security trust funds, and revenues not needed to pay benefits in the current year are invested in government securities. White House officials and many Republicans in Congress say workers could get higher rates of return if some of their retirement savings were invested in private stocks and bonds rather than in government securities.
Mr. Shaw, who is chairman of the House Ways and Means subcommittee on Social Security, said private accounts were "the only way we can take care of our kids in the future, when we'll have more retirees and fewer workers.''
White House officials said it was unfair to portray the president as supporting privatization.
"I do not favor 'privatization' of Social Security,'' Mr. Bush wrote last month in the AARP Bulletin. "Those workers who do not want a personal account would continue to receive their benefits from the federally administered Social Security system. Even those who choose a personal account would continue to draw traditional Social Security benefits.''
Mr. Bush said his proposal would give workers ownership and control of their accounts, allowing them to pass wealth to their heirs. But AARP says retirees would bear a substantial investment risk and would have to accept lower guaranteed benefits under the president's plan.
The Cato Institute, a libertarian research center, established a Project on Social Security Privatization in 1995, but in 2002 it was renamed the Project on Social Security Choice.
"Republicans in Congress do not like the word 'privatization' because it does not poll well,'' said Michael Tanner, director of the project. "The word polls more poorly than the actual concept, in part because people do not understand what it mean.
http://www.nytimes.com/2004/11/12/politics/12benefit.html?oref=login&oref=login&th
Goodbye, Pension. Goodbye, Health Insurance. Goodbye, Vacations.
Welfare capitalism is dying. We're going to miss it.
By Daniel Gross
Posted Thursday, Sept. 23, 2004, at 1:37 PM PT
For some employees near the end of their careers, the golden years may be looking a little more like lead. Both United Airlines and US Airways are making noises about terminating their pension plans. Lucent recently said it would slash retiree health benefits yet again. The inability or refusal of companies to live up to promises and commitments made to workers seems to be largely a cyclical phenomenon, a symptom of temporarily sick industries (airlines) or of a company plagued by poor bets and bad management (Lucent). But it is also a sign of the troubling collapse of welfare capitalism.
Welfare capitalism is a term used by historians and economists to define the distinctive style of capitalism that emerged in the 20th century. Until the turn of the 20th century, fringe benefits, insurance, retirement plans, and health benefits—the perks we have come to define as essential to employment—simply didn't exist. Employers had compensated employees solely with wages.
But that changed with the onset of industrial capitalism. In Europe, governments responded to industrialism by developing state-run systems of unemployment insurance, health care, and pensions. But—in yet another example for American exceptionalism—the private sector took the lead in the United States. After the age of the robber barons and various bitter strikes, forward-looking companies began to take action on their own. They were influenced by a range of factors: noblesse oblige, paternalism, and the emerging fields of industrial psychology and human resource management.
Henry Ford led the way. In January 1914, Ford Motor Co. instituted the $5 day. Over the next several years, Ford took steps to ensure that its employees remained healthy, loyal, and above all, efficient. It opened an infirmary and established the "Sociological Department" to both keep tabs on and look after the welfare of its workers. In 1922, Ford cut the work week from six days to five.
In the roaring 1920s, when other highly profitable companies began to emulate Ford, welfare capitalism began in earnest. Companies built cafeterias and health clinics, sponsored baseball and bowling leagues, and granted days off for the opening of deer season. Corning Glass Works began providing health insurance in 1923. The same year, U.S. Steel slashed its workday from 12 hours to eight. In 1927, International Harvester began offering two-week paid vacations. All this was all done without government mandates and largely without the influence of unions.
Welfare capitalism proved a phenomenal success—socially, economically, and politically. America's industrial complex was ultimately unionized, but with relatively little upheaval. Even with the rise of the welfare state in the '30s, corporations continued to assume responsibility for the well-being of their employees. It was part of a grand bargain between labor, capital, and government that allowed for remarkable growth, innovation, and rising standards of living for decades. It also served as a bulwark against socialism. By endowing labor with dignity, welfare capitalists made industrial work a ticket to the middle class.
But just as the New Deal Coalition started to fray in the 1960s, so too did welfare capitalism. American businesses—and workers—increasingly began to face competition from all over. They began to have difficulty competing with companies from countries where more robust welfare states bore the burden of providing pensions and health insurance (like Germany and Japan). They began to have difficulty competing with low-wage competitors in countries where welfare capitalism had yet to take hold, like Mexico, China, and India. And they began to face competition from newer domestic companies that never bought into the ideas of welfare capitalism.
In the 1920s, competitive pressures led companies to become more paternalistic to unskilled workers. But now, the pressure is all in the other direction. With each passing year, more and more retailers have to compete with Wal-Mart, and more and more manufacturers have to compete with China. Even enlightened employers like Starbucks can't ever hope to offer the sort of programs that International Harvester and Ford did back in the 1920s. And so welfare capitalism is slipping away. Health care insurance has increasingly become decoupled from work. According to this Kaiser Family Foundation study, 61 percent of workers are covered by employers' health insurance, down from 65 percent in 2001. And pension plans, which guaranteed a retirement income to employees, are being replaced by 401(Ks), which offer no such certainties.
Most free marketeers would argue that this is simply the price of progress. Now that we're competing in global markets, welfare capitalism as practiced in the mid-20th century is simply untenable. And companies that aren't burdened with expensive benefit programs can be more agile and thus more profitable. But it isn't just the workers of Lucent and US Airways who are going to pay for the long goodbye of welfare capitalism. We all will.
When companies decide they no longer want to—or can't—meet the promises they made to employees, they push them wherever possible onto the federal government. The Pension Benefit Guaranty Corp. has been remarkably busy taking over the pensions of bankrupt textile, steel, and other manufacturers. The PBGC closed last year in its worst shape ever, with an $11.2 billion deficit, and will doubtless require a large taxpayer bailout. The establishment of the new drug program entitlement for Medicare will similarly relieve many older companies of meeting the obligations they made—and impose massive costs on the rest of us. And as companies providing health care become the minority, the Fords and General Motors of the world may increasingly agitate for a larger federal role in health insurance.
The more welfare capitalism declines, the more the federal government will have to fill the gap, and the more America will look like Europe.
Daniel Gross (www.danielgross.net) writes Slate's "Moneybox" column. You can e-mail him at moneybox@slate.com.
Photograph of auto worker on Slate's home page by Rebecca Cook/Reuters.
http://slate.msn.com/id/2107108/