Social Security: Living on Borrowed Time

Posted on December 18, 2004

In President Bush's weekly radio address, he said of his plans to revamp Social Security: "I'm open to good ideas from Democrats and Republicans." So, let me get this straight. He still doesn't have a specific plan yet for tinkering with the elderly's social safety net? That's not terribly reassuring. The White House keeps floating trial balloons to see what kind of reaction they get.

So far, the reaction has been remarkably cool, especially considering the fact that we still haven't even heard the details for this supposedly sweeping change. If one supposes that Bush's plan is to allow workers under 30 to take a small percentage of their incomes and put them into private accounts, the estimated transition costs will be between $1 trillion and $2 trillion. Because our government has recklessly spent the money that the current retirees have been paying into the system for the last forty years or so, the system relies on the earnings of today's young workers to fund current benefits payable to retirees. This shortfall will have to be met by our borrowing from the Chinese and anyone else who's willing to continue to finance our profligate spending spree.

But the word is that the countries that hold much of our debt are increasingly unhappy with our free-spending ways. And aren't the countries buying up our debt also doing arms deals with terrorists? Is this really a good idea to owe these people a lot of money? And exactly how much did Bush just ask for in additional funding for the Iraq War -- $100 billion or so? But we'll get that money back in oil revenues, right? Oh wait, Bush made sure that that provision was taken out of the Iraq spending bills -- Iraq doesn't have to pay us back for the cost of "liberation." Not to worry. I'm sure our international creditors will be just as generous when the time comes.