President Franklin D. Roosevelt signed the Social Security Act on August 14, 1935. On the 75th Anniversary of the Social Security Act becoming law President Obama gave an impassioned address declaring he is dedicated to making sure Social Security benefits are protected for older Americans.
In his address President Obama reminded Americans of the dangers of privatizing social security. However, in spite of recent ups and downs of Wall Street, the President states that privatizing Social Security is still a cornerstone of the Republican political agenda.
President’s Weekly Address Honoring Social Security
President Obama said in his Weekly Address to Americans:
“One thing we can’t afford to do, though, is privatize Social Security. An ill-conceived idea that would add trillions of dollars to our budget deficit, while tying your benefits to the whims of Wall Street traders and the ups and downs of the stock market.”
“Some Republican leaders in Congress don’t seem to have learned any lessons from the past few years. They are pushing to make privatizing social security a key part of their legislative agenda if they win a majority in Congress this fall.”
Banks Get Big Fees if Social Security is Privatized
Behind the green door of why Republicans are pushing for privatization of social security is a big fat secret out in the open.
Who benefits? The Banks and financial institutions that would manage the privatized Social Security money that you earned. Of course it is framed as being for your benefit. However, the big winners are the folks that get hefty fees for all the transactions and management that would result from privatizing your social security.
It would be like playing russian roulette with your nest egg savings.
Of course not every banker is a snidely whiplash type of person. However, Wall Street in general tends to have a herd mentality and that mentality is based solely on profit for Wall Street, as the housing derivatives catastrophes reveal.
In the name of profit for the bank or brokerage firm, some institutions like Goldman Sachs will even double cross their own investors in the name of making profit for themselves. Remember, the institutions that would manage your nest egg have to always keep increasing their quarterly profits so their shareholders are happy. The games played on wall street keep changing to avoid new regulations.
We still do not know the entire black hole of debt created by the synthetic collateralized debt obligations (CDOs) that were created by slicing and dicing bad mortgages and repackaging them into securities that were bought up like chocolate by firms eager to turn a quick profit.
Wall Street Wizards and Social Security
All those crazy crazy exotic securities created by wall street wizards came into existence due to the cozy relationships between the folks on various regulatory boards with the firms they regulated. Also, not much regulation happened under G.W. Bush and the Republican congress that suffered under the notion that wall street could just police itself and that the market could do not wrong. We see how well that went with the collapse of the economy in 2007 and when all the skeletons in the closet started breaking down the doors. The Madoff Pyramid Scheme was just a little symptom of what was to follow.
But hey, Republicans must have short term memory problems because their one-note samba approach to dealing with every problem under the sun seems to be:
Cut taxes and privatize social security…
Cha Cha Cha!
GOP Rep: Let’s Privatize Social Security And Cut Benefits
Where most people clearly understand the scientific concept of cause and effect, many Republican leaders do not seem to grasp even this fundamental law of the universe.
Social Security and the Market:
The benefit of Social Security now in 2010 is that it thankfully has a set formula for payout to you the beneficiary that is not affected by the ups and downs of the market. If Social Security were privatized as Republicans propose, the market fluctuations would be tied to your benefit.
Under G. W. Bush there were some Republican policy and public relations folks who claimed that they “created their own reality.” Even if these folks achieved that feat, whatever reality they created was not the one most Americans chose to take part in based on the overwhelming majority that voted for President Obama in 2008.
Any thought of privatizing Social Security should be put to rest once and for all as a bad idea whose time should never come.