President Bush finally comes right out and tells the truth about Social Security

Yesterday, speaking at West Virginia University, President Bush finally said in plain language the truth about the so-called Social Security trust fund:

have just come from the Bureau of Public Debt. I want to thank Van Zeck, Keith Rake, and Susan Chapman. Susan was the tour guide there at the Bureau of Public Debt. I went there because I'm trying to make a point about the Social Security trust. You see, a lot of people in America think there's a trust, in this sense -- that we take your money through payroll taxes and then we hold it for you, and then when you retire, we give it back to you. But that's not the way it works.

There is no "trust fund," just IOUs that I saw firsthand, that future generations will pay -- will pay for either in higher taxes, or reduced benefits, or cuts to other critical government programs.

The office here in Parkersburg stores those IOUs. They're stacked in a filing cabinet. Imagine -- the retirement security for future generations is sitting in a filing cabinet. It's time to strengthen and modernize Social Security for future generations with growing assets that you can control, that you call your own -- assets that the government cannot take away.

I personally would much rather the Social Security tax I'm paying go into a private account. Heck, I'd rather put it in my 401k plan to be honest. The opposition to privatizing Social Security is sometimes just plain stupid. For example, Hans Reimer, the political director of the organization Rock the Vote said:

To us, it's totally black and white. This is the first generation ever that would be asked to pay for their own retirement and Social Security at the same time. This is what private accounts do. They saddle young people with an unfair burden.

Huh? What he apparently doesn't realize is that this "first generation" would not be paying any more than anyone else. The only difference is that some of what they pay would go into a private account and the rest to the regular Social Security fund (which means, of course, it would end up in the general fund, replaced by another of those IOU's).

I don't know if Social Security reform has a chance of happening during this administration. But at least the President is still talking about it and working to make it happen. Yes, Social Security isn't in immediate danger; it will be able to pay full benefits for a while. Currently more is coming in than is being paid out in benefits. The difference, as noted above, is then "borrowed" by the general fund and replaced with treasury bonds. Some think that qualifies as a "trust fund" but that's an illusion as the government is literally borrowing from itself. It's similar to my borrowing from my 401k account. I have to pay back the "loan" with interest, and that interest goes into the account so it's still mine, but that interest doesn't equate to profit. Those bonds will have to be repaid, with interest, and that payment and interest will come from taxpayers. In effect, the government is borrowing from us and then paying us back, using our own taxes to do it. Sounds like a profitable "trust fund" to me....