Friday, May 06, 2005

Angry Angry Bear

I may be wrong in reading a sarcastic and angry tone in Angry Bear's post on social security, but he does call himself Angry Bear after all. After quoting Bush explain his plan, Angry Bear says
Granny is too smart to think her checks will not be mailed. What makes granny upset is how the White House is flat out lying to her smart granddaughter who is working hard in college. Granny might even be smart enough to know that with no reforms, the kid’s Social Security checks will be only 80% of what is currently promised but that beats the 50% of what is currently promised that would come from the Pozen plan. Let’s also imagine that the kid’s parents are both 45 years sold working hard at jobs paying $45 a hour. The parents have paid a lot into the Trust Fund for 20 years and will continue to pay a lot into it over the next 20 years, but would receive a modest benefit cut relative to what is currently promised if the Pozen plan goes into effect.
But this is true. Grandma is OK. Mom and Dad are less OK. Daughter is toast. Angry Bear also sounds incredulous when he says
So if I own a Treasury bond, that is a real asset but it is not a real asset when a Trust Fund owns a Treasury bond.
But again, this is true. When you hold a treasury bond it is your money. When the government holds a treasury bond for you it is their money, and you may or may not get something depending on various political decisions.

At its heart, the muddle over social security reflects the muddle over other, basic questions, such as "should people save for themselves or should the government save for them", "should the government take money from rich people and give it to the poor or not? If they should, how much?". As social security stands, it saves for no one, and takes from both rich and poor young people and gives to rich old people.


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