The GOP/Bush propaganda machine has been spewing its latest mantra, this time about the supposed “social security crisis.” Laura Tyson in Business Week:

After years of repeated warnings by conservative political thinkers, the word crisis has become the mental frame that shapes the way many Americans think about Social Security’s future. But as a recent Brookings Institution book by Peter A. Diamond and Peter R. Orszag demonstrates, Social Security does not confront a crisis; in fact, its solvency for future generations can be ensured through modest benefit reductions and modest revenue increases.

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A major lesson of this analysis is that Social Security can be put on a solid financial footing without dramatic change. In contrast, President Bush is using the specter of an impending crisis to justify allowing workers to divert up to 4% of their payroll taxes into private, individually controlled retirement accounts. This would reduce payroll tax revenues available to cover promised Social Security benefits by as much $2 trillion to $4 trillion, transforming an imaginary crisis into a real one. The Bush Administration has recently indicated that it plans to finance these transitional costs of creating private accounts through additional government borrowing. But the amounts involved are as much as an added $100 billion a year in government borrowing for the next decade, rising to $350 billion a year after 20 years. Additional borrowing of this magnitude on top of already large government deficits could spook global investors, triggering sharply higher interest rates on U.S. government debt and a collapsing dollar. But President Bush has been silent about the possibility of such a crisis. He has also been silent about the fact that individual accounts would require paying financial management fees that could amount to more than 25% of Social Security’s current 75-year funding gap.

According to a Boston Globe op-ed piece by Robert Kuttner, “Simply restoring pre-Bush tax rates on the richest one percent of Americans could bring the Social Security system into balance indefinitely, without reducing promised payouts by one penny.”

If there is no crisis, why are Bush and company so intent on creating that impression? Marie Cocco in Newsday:

So why does Bush want to create a crisis that doesn’t exist and provide a solution that doesn’t fix it? Because he is an economic Darwinist. In Bush’s view, the financially strong should be helped to prosper. The weak should pay the bill.

This philosophy has guided his mammoth tax cuts. It underpins Bush’s answer to Americans without health insurance. He wants them to insure themselves through still more private savings accounts.

She goes on to explain how Social Security “was created to shield us against capitalism’s sharp edges,” and concludes with a warning:

This game of roulette would, of course, have winners. They are corporate chieftains and other Bush business allies, the same donors who fund his campaigns. They contribute as much as $250,000 for his upcoming inauguration. A celebratory check in that amount would pay 13 years of Social Security benefits for an average retired couple.

Now these donors pledge a multimillion-dollar advertising blitz to push privatization of Social Security. So buyer, beware.

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