posted 02-05-2002 11:48 PM            

Many surprised by how deeply retirement savings would be tapped

By Peter G. Gosselin
Los Angeles Times

WASHINGTON -- In the budget he delivered Monday, President Bush relies on one source of new money more than any other to pay for his proposals: the trillions of dollars in Social Security funds being set aside for the start of the baby boomers' retirement.

Although Bush and his aides had warned that the war on terrorism and the need for homeland defense would require dipping into the Social Security surplus and running deficits for a few years, the dimensions of what the administration had in mind were not apparent until the unveiling of the $2.13 trillion spending plan for fiscal 2003. The measure took the breath away from some Democrats and independent analysts.

"The president is requiring the use of Social Security to pay for the normal operations of Government," said Dobert D. Reischauer, president of the nonpartisan Urban Institute and a Washington budget veteran. 'That's the most significant, and largely unrecognized, change he's making."

Citigroup vice chairman and former Clinton administration Treasury secretary Robert E. Rubin declared: "This country is ill-served by abandoning fiscal discipline, and this (budget) abandons fiscal discipline. It's the opposite of what was accomplished in the 1990s."

To be sure, that opinion was not universally shared, and no one claimed there was any danger to current retirees' benefits. Former Sen. Daniel P. Moynihan, D-N.Y., who co-chaired a recent commission on Social Security for Bush, said, "My own view is that this is a war budget. This is a national emergency and the president is responding."

Still, many analysts expressed surprise, both at the extent of deficits in the new Bush budget and its extensive use of Social Security money to cover them. Most surprising:

. Far from running only a few years of deficits, the new budget assumes that the government's so-called "on-Budget" spending, which covers everything from maintaining a military to subsidizing Amtrak, will run $150 billion more in the red each year for the next decade, according to documents and White House officials.

. Instead of covering the bulk of the costs with expanding income-tax revenues that can be expected with the resumption of economic growth, the plan relies heavily on Social Security money to nudge the overall budget -- which includes on-and-off budget spending, such as payments to retirees -- into the black by 2005.

. Although the president argues that the chief reason the nation must run in the red is to pursue the war on terrorism, his budget calls for new tax cuts -- over and above the 10-year, $1.3 trillion package approved last year -- equal to or greater than the new defense spending he seeks. The plan includes $590 billion in additional tax cuts over 10 years, but only $550 billion in new defense spending.

"Everybody concedes that deficit spending, if it is in response to an emergency like Sept. 11, is not a bad thing," said Robert Bixby, executive director of the antideficit Concord Coalition. "But what's astounding is that this goes way beyond what was (once) a strong political consensus to save the Social Security surpluses."

In fact, before the September attacks, the president was at the center of that consensus. In an address to a joint session or Congress a year ago, he declared that "to make sure the retirement savings of America's seniors are not diverted in any other program, my budget protects all...of the Social Security surplus for Social Security, and for Social Security alone." His pledge was considered critical to winning congressional passage of his $1.3 trillion tax cut.

But Bush and his aides appear to have decided that they cannot pursue their new military and homeland defense goals, protect the president's already approved tax cuts and maintain the Social Security surplus. And they apparently think there is little political cost to giving up on the surplus pledge.

In part, that's because there is no immediate danger to retiree's checks. The system expects to collect more than $700 billion in revenues this fiscal year and pay out only about $470 billion in benefits. But analysts warn that failure to keep running surpluses and paying off federal debt will leave the country in a painful bind as baby boomers retire in growing numbers, and it will burden the smaller generation of workers that follows with rising Social Security tax costs.

"By paying down the debt, we were increasing national savings, reducing the upward pressure on mortgages and corporate debt, and cutting the government's own interest bill," Rubin said.

Analysts drew the analogy to a couple paying off their home mortgage before retiring in order to cut monthly costs and save. They said that Washington was making the payoff in the nick of time because baby boomers are expected to begin leaving the work force in substantial numbers around the end of the decade.

Rubin and other analysts said that the administration's sudden lurch into deficits demonstrates that last year's tax cuts were more than the country could afford, and that any further cuts would compound the problem. "They're unwise and unjustified," Reischauer said.

But it was unclear Monday whether congressional Democrats will find the political spine to oppose a president with sky-high public approval ratings in the midst of a war on terrorism.

Capitol Hill democrats criticized Bush for submitting a budget that goes into deficit, but they offered no suggestions about how to bring it back into the black.

In fact, the lawmakers suggested they would support policies that would make the deficit even bigger: While supporting Bush's increases in defense and homeland security, Democrats opposed offsetting cuts in highway, environment and other domestic programs. At the same time, Democrats insisted they would not seek a tax increase or rollback of last year's tax cut.

About all that congressional Democrats would offer was ideas for curbing future tax cuts. Senate Budget Committee Chairman Kent Conrad, D-N.D., said that the Democrats' budget proposal may include a "trigger" that would turn off future cuts or spending increases if the tax revenues to pay for them do not materialize.

posted 02-06-2002 09:36 AM            

However, given the recent problems that FreeRepublic.com has encountered by posting other news agencies' reports in their entirety, you might want to think about how much stuff you cut and paste in another forum such as this one.

I believe (and I'm not a lawyer, of course) that we can cut a few paragraphs under the "fair use" parameters and reprint them on andother page, while making sure we attribute the source (as you did). But, given the recent decisions on intellectual property, someone from the LA Times could come down on Thermit and force him to remove the articles. Although I doubt it would happen, there have been several very large monetary penalties against people who do this. I'd hate to see Brother Thermit have to go through such a mess.

Perhaps a better approach would be to just copy a paragraph or two and then provide a link to the page where it originated.

Regards,

posted 02-06-2002 03:56 PM            

I read this article from the front page of The Spokesman Review, dated Tuesday, February 5, 2002. They got it from the Los Angeles Times. I typed out the entire article verbatim because each paragraph seemed to me to be pertinent to the entire story. I then posted it here at the Chemtrail Central, Other Trails section. I did not get this story from the Internet, and I have not checked to see if this story is on the Internet at any location.

The Other Trails title: The Fornication of the American People in the Name of The War on Terrorism, is my own.

posted 02-07-2002 09:29 AM            

Yes I am beginning to think they are implementing plan B for their "escape" from future earth changes and they need alot of bucks to do that. ALOT! They are going to save their own asses if it's the last thing they do! Looks like the Mars thing didn't work out and "they' are acting obviously frantic. If they need 380+ BILLLLLLYIN uncontested dollars for the "fight on terrorism" (fighting their own terror of being here when May 2003 come around), you know damn well they are going to take it from anywhere they can stick their grubby fingers. Social Security, 401ks next maybe? That Enron fiasco sure shows the true colors and what these people are capable of (as if we didn't already know) Hey! they have to "catch the terrorists" Maybe it will go to "trailer homes" in the sky, but you know damn well they aren't looking for terrorists. Osama seems to have faded into the past already. How many innocent people and little babies died for that bull,, more than we will probably know. I will probably get a helicopter visit for this one, but I say,,, use your money now, to prepare for the none you will have in the future.

Why else has:
Bob Dole pushed for an operational Star Wars by the year 2003, Missile Defense and Asteroid Defense is to be operational by 2003, the NASA Q&A site indicating anxiety over an asteroid strike in 2003, comet smashing operation Deep Impact to be ready by 2003, and the possibility of a Mars Passby in 2003 causing a pole shift. Where the NASA 1997 Launch Manifest used to show no activity beyond 2003, the Space Station is to be dedicated in 2003, the Mars Express must be ready by June 2003, and is a Return Flight. Air to Breathe and Propellant on Mars are to be created by 2003, and a Space Escape is available for the rich by 2003, with European participation and Human Exploration, the mission Postponed until 2003 in spite of Setbacks, with Enhanced Telecom by 2003. Lawrence Livermore is developing a Crystal Laser by 2003, the SOHO Sunscan continued to 2003, the Solar Cycle moved to 2003, space Interferometers and a mission to Europa launched in 2003, Sea Launch of satellites expanded to 2003, NASA's GIFTS Mission targeting early 2003, and an ESA Rendezvous with a comet is planned for 2003.

A pattern of pointers to the year 2003 can be found in plans laid by the establishment. Weinberger predicts a War with Mexico in 2003, and the Russian predict Disaster in 2003. Recently the Pentagon included a 20 Billion Stash in their budget to prepare for the year 2003, PDD 63 ensuring infrastructure protection by 2003, the DoD Records are to be consolidated by 2003, Base Closings by 2003, and Navy Plans show them intent on refurbishing their ships by 2003. Both super powers agreed in Start II to reduce their Nuclear Weapons by 2/3 by the year 2003, including nukes in Russian Subs, Nuclear Wastes stored in Nevada by 2003, with Monitoring in place by 2003, the ABM System is to be in place by 2003, SAFTA is to be in place by 2003, Land Mines are to be eliminated by 2003, and disposing of Biological Weapons scheduled for late 2003 but with a Catch. Medicare is expected to go bankrupt in 2003, Social Security eligibility changes are pushed past 2003, a Balanced Budget is pushed past 2003 as is NOx Compliance, the Alaska Coffers empty by 2003, electric utility Deregulation targets 2003, and Fuel Cells cost effective by 2003. Japan's IRIS launched in early 2003, reform of Japan's Finances targets 2003, the massive Chinese Yangtze Dam to be in place by 2003, the European Framework Program changed to be completed by 2003, German Nuclear Plants closed by 2003, an international Search and Rescue agreement is in place through the year 2003, and Firearms Registration in Canada must be complete by the year 2003. http://nibiru1.tripod.com/planetX.htm
Hmmm? How come?

(Shortly after posting this, my e-mail mailbox became "unaccessible at this time".Other names on ths account had no problem accessing their mail at this time.At the time it happened my e-mail claimed to have 0 mail. I know I had over 100. I wonder where, only my e-mail went to, for that time. It's all back now tho)