Clinton Needs To Be Questioned Very Hard on Social Security

I think Lambert Strether is absolutely right–we need to follow the money. Because Hillary Clinton’s call for GRAs (guaranteed retirement accounts) is very troubling–though not for her bundlers and heavy hitter donors (boldface mine):

Check out this beat sweetener for potential charismatic technical spokesperson, Teresa Ghilarducci, in the National Journal (hat tip AH), where we see the Clinton code of omerta fully operative:

[Ghilarducci] will not talk about how many times—or when, or where—she has met with Clinton … Though Clinton has begun her campaign on a decidedly liberal note, it’s anything but clear how far she’ll go in adopting the kind of agenda that Ghilarducci advocates. Clinton gave “retirement security” a shout-out in her campaign launch speech on Roosevelt Island, but there were no specifics. [That’s putting it mildly. –lambert] “The retirement issue will come a little bit later in the campaign, when more people are paying attention,” Ghilarducci says.

Good to know; Ghilarducci seems pretty clued in, for an “informal economic advisor.” Here’s the “retirement security” policy that Ghilarducci is pushing: GRAs.

Ghilarducci’s big idea is to create government-run, guaranteed retirement accounts (“GRAs,” for short). Taxpayers would be required to put 5 percent of their annual income into savings, with the money managed by the Social Security Administration. They could only opt out if their employer offered a traditional pension, and they wouldn’t be able to withdraw the money as readily and early as with a 401(k). The government would invest the money and guarantee a rate of return, adjusted to inflation

What this sounds like is a way to funnel people’s retirement funds to Wall Street. After all, if you want to force people to save more, you could just increase Social Security taxes and payouts. But if you think the Mad Biologist is being cynical, just listen to Ghilarducci her very own self (boldface mine):

I expected verbal fireworks. Instead, it went down more like a cordial afternoon tea. [Far rightwing faithtankers] Moore and Laffer extolled the virtues of low taxes, less regulation, and overhauling Social Security, Medicare, and Medicaid. The audience of money managers nodded along, but Ghilarducci reined herself in. She rested her chin on her hand. She gripped a bottle of water. At one point, her face registered bemusement, but only a little. When her turn came to talk, Ghilarducci argued politely for the importance of the government’s role in moving along the economy. She made the case for older folks having more money in retirement. And, sounding nothing like a fire-breathing populist, she appealed to her audience’s self-interest: getting to handle people’s extra retirement cash.

Somewhere in our political discourse there has to be room for a Democrat who doesn’t give the store away to the likes of Pete Peterson and his ilk. Strether sums it up well (boldface mine):

All about the fee fees, just like I said. (But wait! you say. It’s a government-run program. But as the sausage to pass the bill gets passed, I’d bet that the managing the funds will be outsourced; allocating streams of rent is, after all, the function of the market state.)

So, once you understand what the GRA is really for — entrenching money managers in the retirement system, hopefully forever, just as ObamaCare did with the health insurance system — the defects of the program fall right into place…

So, it would be great if the Clinton campaign figured out that improving a proven and popular program like Social Security would be an electoral winner, besides being the right thing to do. Then again, they’ll get a cut of the fee fees, called “campaign contributions,” or possibly “donations to the Clinton Foundation.” “I’m thinking it over”

Between equivocating about Social Security and her deficit hawkishness, even if Clinton wins, it’s going to be a shitty four years. And for the love of the Intelligent Designer, it should not be hard to get a Democrat who doesn’t try to privatize everything.

This sucks.

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2 Responses to Clinton Needs To Be Questioned Very Hard on Social Security

  1. Colin says:

    The idea of a sovereign, currency-issuing government investing $ in financial markets in order to have more $ to pay retirees later is absurd. Balancing production with consumption during a period of increasing percentages of retirees in the population is not necessarily trivial, however, the Federal Government investing $ now it can always issue in the future anyway will not guarantee that there will be enough goods and services in the future to meet the needs and desires of future retirees. Forcing workers to save 5% of their salary now does not ensure that 25 years from now there will be enough doctors & nurses, nursing homes, prescription drugs, TrustyCanes, or what-have-you for those workers, but it does reduce their standard of living NOW. Saving $100,000 is not the same as saving $100,000 of a doctor’s time. The latter is something that cannot be saved; it’s not like money. What is important is what resources will be available to meet future needs. Those resources are material and human and have almost nothing to do with money. No amount of money can buy the health care we need in the future if there are not enough doctors. Money is merely a convenient way of transferring goods and services–sort of the photon of the financial system-but those goods and services need to exist.

    It would be far more rational for the Federal Government to look for real policy solutions for provisioning a sufficient future supply of medical personnel, prescription drugs, and broader consumer goods for retirees to consume and then commit to paying for a certain amount of those things (but that will never happen).

  2. Robert L Bell says:

    Here we see the flaw in the Sanderista strategy of bloviating and muck flinging: for people who don’t really pay much attention to politics, how does one differentiate this particular article from the typical content free screaming and shouting? Perhaps you might add a banner headline that indicates “we are serious this time, pay attention, this is truly important” followed by some bullet points describing how this is important and legit and you really are serious this time.

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