The Clinton Social Security privatization plan will go to the congress looking like a donkey in drag---what will come out of the congress will look like a raging bull elephant in heat.
Nathan, the Supreme Court made a ruling Monday in the case of Hughes Aircraft Co. vs. Jacobson, 97-1287. Have you heard any discussion of this lawsuit or court ruling.
Your email pal,
Tom L.
Netcom wrote:
> From: Tom Lehman <uswa12 at lorainccc.edu>
> To: lbo-talk at lists.panix.com <lbo-talk at lists.panix.com>
> >Meanwhile, Oberlin's own hindsteiner Bob Kuttner is confusing the issue
> with
> >his support of the Clinton privatization plan.
>
> Let's be clear: Clinton has no privatization plan. He has a stock
> investment plan (which I rather like for the reasons Milton F. hates it).
>
> The other part of the plan is a supplemental private savings plan, the USA
> accounts, which are more analogous to IRAs than to Social Security. And
> from the details I have seen, they look a lot better for working class folks
> than IRAs.
>
> IRAs are based on tax free savings, which benefit those who have high tax
> rates (ie. rich folks) a lot more than those who have low tax rates.
> Essentially, income taxes were cut for rich people with much less gain for
> working class folks.
>
> By matching contributions with government money, the proposed USA accounts
> are essentially transferring money from the progressive income tax
> collection to working and middle class savers. The proposal I've seen says
> that something like $600 of saving would be matched with another $400 cash
> match by the government. That is direct transfer of wealth.
>
> The biggest criticism of the USA accounts are that many poorer folks can't
> afford to save, so won't get the benefit, but since the savings needed
> ($600) is low, that is a lot less of a problem. The old IRA system meant
> that to get the equivalent of a $300 cut in taxes (useful only for those
> paying tax), a working class person in the 15% tax bracket had to save
> $2000- a much more burdensome approach for less benefits than the USA
> account.
>
> The USA account is not perfect but it is a radical improvement over IRAs for
> helping working class folks save for retirement. Social Security is not
> enough for most people, so supplementary pensions are needed. We can fight
> to demand that businesses provide them (and even integrate USA accounts into
> them to encourage every worker to get one), but this does sound like a
> straight up improvement on what we have now with IRAs and 401Ks that benefit
> rich folks.
>
> --Nathan