Lies and Levity

October 10, 2002

Last fall, the President's Commission to Strengthen Social Security put forth three proposals designed to change the soon to be bankrupt pay-as-you-go Social Security system into one that would provide solvency, choice, and security with the introduction of personal retirement accounts.

The Commission's proposals have been met with a lack of feasible alternatives from those opposed to personal retirement accounts. Instead, those opposed to Social Security reform rely on scare tactics and misleading representations of the word "privatization."

Recently, the Democratic National Committee sent out a fundraising email that included a video depicting President George W. Bush laughing deviously while pushing wheelchair bound seniors over a cliff to their deaths. As Marc Racicot, chairman of the Republican National Committee, points out, "The D.N.C.'s activities reflect desperation and serve as further proof they are a party unable or unwilling to offer positive solutions to important problems."

The video, which can be seen at http://www.democrats.org/social_insecurity/, completely misrepresents the nature of private account alternatives, as well as the funding crisis faced by the current system.

In the animation, the narrator opines, "Instead of guaranteed benefits, your retirement would be tied to stock market returns. And what if George Bush had gotten his way? Since he proposed his plan, the Social Security trust fund would have lost 40% of its value. That would mean big benefit cuts, or working longer."

This narrative is filled with false and misleading statements.

First, President Bush has never proposed investing the Trust Fund in the stock market. It was the Clinton administration, in fact, that made such proposals. Under the Bush proposals, the trust fund would be unaffected by swings in the market since it would continue to hold nothing but government bonds. Workers could choose to invest part of their payroll taxes in a personal account, and those with accounts could choose to invest part of that money in broadly diversified stock index funds. But the only administration that proposed mandatory investment of the trust fund in the stock market was that of Bill Clinton and Al Gore.

Second, there is no such thing as guaranteed benefits in the current system; there are only promises, which cannot be kept without large infusions of additional revenue. Benefits have been cut before, and it can happen again.

Third, the video asserts that the President's plans would force tax increases or benefit cuts. In fact, the higher returns on personal accounts reduce the need for tax increases and benefit cuts.

When asked about the offensive video, DNC spokeswoman Maria Cardona replied, "We are trying to have people visualize in a humorous way the reality of the Social Security privatization plan."

Yet there is little humor to be found in portrayals of the President pushing seniors to their deaths, and even less in tactics designed to delay the reforms that Social Security so clearly needs.

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