Monday, December 20, 2004

The more you think about it, the more the Iraq invasion sums up everything about the Bush administration.

Saddam Hussein posed an implicit threat to the United States. He was a Bad Guy, after all, and he didn't like America. He didn't have the capability to explicitly threaten the United States or any US allies in the Middle East. He didn't have WMDs. Nor WMD programs. Nor any WMD-related program activites. But there was a scientist in Iraq who kind of dabbled in growing nasty molds in his refrigerator. And we knew Saddam was a Bad Guy. And someday he could give those nasty things to terrorists or take a nuclear pot shot at Israel or incinerate the atmosphere and destroy all life on Earth -- some day, you know! So -- voila -- implicit threat becomes explicit threat. Time to invade. There is no alternative.

This same logic is being used now to gut Social Security.
Over the next decade, the federal government may need to borrow around $2 trillion to fund the individual account plan most favored by the Social Security commission that Bush appointed in 2001. For the decade after that, the bill would be even larger.

. . . Officials are beginning to push the argument that this borrowing wouldn't amount to new debt at all. Instead, they maintain, it would simply convert implicit future debt into explicit current debt.

What's implicit debt? The administration uses the phrase to describe the long-term financing gap between the money Washington is raising for Social Security through the payroll tax and the cost of benefits promised to future retirees. The Social Security actuaries place that gap at $3.7 trillion over the next 75 years, and $10.4 trillion through, literally, infinity. Bush and his aides are highlighting the larger, scarier number.

The White House case is that financial markets are already considering these large unfunded future obligations when setting interest rates today. Their theory is that even if Washington adds trillions to the national debt to fund individual accounts, the markets won't raise interest rates � as long as the overall restructuring plan eliminates Social Security's long-term financing gap.
Of course, there is no $10.4 trillion debt because, well, we're in the present not the future (and I'd love to see the evidence that capital markets are 'pricing in' this $10 trillion right now). We don't know what future governments will do. But assuming a ridiculous totally unbelievable worst-case scenario -- namely that these future American leaders will do nothing about the future funding gap other than borrow money year by year to close it -- suddenly the funding gap is a tin pot dictator building up weapons of mass financial destruction with help from wishy-washy one-worlders who like French cheese.

What other choice do we really have but to invade the sonsabitches at the Social Security Administration? After all, raising the retirement age by a couple of years and eliminating the $90,000/yr. payroll tax cap is nothing but weak-kneed appeasement. And we know what happened when Neville Chamberlain tried that, don't we?

Funny how current threats like global warming -- evidence of which you can find in your own backyard -- and a current account deficit of 5.6% of GDP and growing larger with no end in sight are matters of little immediate concern. However, that monster lurking out there in 2042 must not only be slain now but in the most reckless manner possible.

Actually, come to think of it, there's nothing funny about that at all.


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