A blog focusing on politics in Central Illinois.

Saturday, February 19, 2005

A response on a response

Gary Sawyer, editor of the Herald and Review, posted a response to my response on his social security posting. His first statement, which should be done, was to remind people I am indeed anonymous, and that should be considered when thinking about how much stock to put into my posting, Poor Richard would be shamed. He then goes on to state that my response was to post a link to the Dem's Social Insecurity Plan Calculator, when in reality my response was, well gee Gary, either you're misleading us, or you dont understand the issue and here is why. And, for you viewing pleasure again here is a recap:

He then goes on to say this:
Of course, no one in the Social Security debate is advocating taking all of the Social Security money and putting it in a private account, or stuffing it in a mattress.President Bush has mentioned private accounts of relatively small amounts – 1 to 5 percent of an individual’s contribution.
And this is where I lose Gary, he is either misleading us, or just plain doesn't get the issue. I'm leaning towards he just plain doesn't get the issue. You see here's the problem, when he says only small amounts 1 to 5 percent of an individual's contribution, what he means to say is 1 to 5 percent of an individual's social security tax which is 6.2 percent. And, I would say that taking up to 80.6% of an individuals contribution to set aside in a private account is not a "relatively small amount"
Then from there I go on to present the idea of since you are going to use such an incredibly bias calculator to prove your stance is right, then I'm going to use an incredibly biased calculator to prove my stance is right. And, that statement is what Sawyer tries to pin my response on. In reality my response is, and remains to be, I don't think you really get the issue.

I still don't think he gets the issue all the way, he is correct in saying that the investment plans are not incredibly high risk, and indeed are rather conservative and safe, however he explains that the Heritage Foundations calculator should be looked at because it looks back. It says here is how much more money I could have, if this had been an option for me from the start. That is a strange way to base a calculation on, mainly because you're proving you're argument by basing it on something that never existed, and still does not exist. A person cannot say social security privitization should be looked at, because hey look at how much money I could have now, that is ignoring the, at very least, trillion dollars of transition costs. And well a trillion dollars is A TRILLION DOLLARS! A better way to look at it, is by looking forward and saying this is what is going to happen to me if we cross over now. I'm open to the idea of letting people who are just starting their security investment invest in private accounts if we can provide a way to pay the transition costs. In today's papers we read that the transistion costs could be covered if the caps on social security were lifted, so taht income over 87,000 dollars was taxed as well, which it is currently not.
So in essence my response is two fold, first off Gary my response was not look at the Dem calculator, it was I don't really think you understand the issue, and oh yeah here's another bias response. And secondly, if the republican party wants to create private accounts they must be willing to lift the tax caps on social security to cover the transitions costs to support that plan, and by doing so add another trillion dollars to the federal government from taxes over a decade. If the conservatives claim to be conservative, prove it, hold the line, privatization is not the way to go.