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Posts Tagged ‘Privatization’

There is a saying that goes, “Those who do not learn from history are doomed to repeat it.”  Clearly, one of the things that the Tea Party, the Republican Party, and conservative American organizations like the CATO Institute have not learned is that their policies with respect to Social Security are diametrically opposed to the lessons of history. These people conveniently forget the origins of Social Security, the reason it was created, and why it is necessary now and for the foreseeable future. A good history of Social Security can be found at the Social Security website.  In brief, while Republican President Herbert Hoover stood by helplessly at the beginning of the Great Depression, millions of Americans lost their jobs, their savings, their homes – everything. Among the hardest hit were senior citizens. Some of these might have had some sort of private pension, but it went up in smoke along with the rest of the economy.  Many of the seniors lost all of their savings because of the collapse of the stock market and the failure of the banks. It was only when Franklin Roosevelt, a Democrat, became President that our Social Security system was created – and it saved thousands upon thousands of senior citizens from becoming homeless and from facing the very real prospect of starvation.

Now we hear the newest “words of wisdom” from the CATO Institute and other right-wing organizations: Privatize Social Security.  These people are either fools or they take us for fools – or both.  If you would like to know how Social Security would be if it were privatized, just take a look at your 401k account. That is a privatized pension plan – a gift from that “great” Republican economic genius Ronald Reagan – the man who drove us trillions of dollars into debt with his foolhardy concepts of Reaganomics. The problem is that Republicans think he did a great job, even while he drove the U.S. debt to historic levels. Another foolhardy concept that came to fruition during the Reagan era was the 401k Plan. Until then, people had employer pension plans; however, the creation of 401k plans let the employer off the hook i.e. the employer’s responsibility ended when the employee retired – the employee would then obtain his retirement income from his 401k investments. Most employers terminated their retirement plans and their employees were told to invest in the stock market in order to create a nest egg that would fund their privatized pension. So, how’s that working out for everyone out there? All set to retire?

The privatization of Social Security is nothing more than yet another Republican scam designed to force people to invest in the stock market.  If this happened it would create another stock bubble similar to the one created by the 401k investments that began in the Reagan years. And what would happen the next time the stock market gets overheated and crashes, like we have seen just recently? You guessed it. You can kiss your privatized Social Security account goodbye – but don’t worry, the government will save the banks. So that’s good.

It is truly amazing that Republicans, Tea Party people, and conservative “thinkers”, like the CATO dudes are actually advocating this. One can only conclude that they feel pretty smug about their own situation. They have plenty of money themselves so they don’t need Social Security anyway. I’m sure that’s true for all the wealthy Republican bankers – but the poor Tea Party people? What are they thinking? Do they really think they don’t need Social Security?

As for those CATO guys, I wouldn’t buy a used car from any one of them.

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