Bush May Be Borrowing Trouble with Social Security Plan

Ron Brownstein of the LA Times has a nice analysis of the risks of the Bush Social Security plan. Brownstein writes that even Wall Street is skeptical:

The plan Bush is expected to endorse would close that long-term funding gap by significantly reducing the growth in guaranteed benefits for future retirees, relying on the returns from the individual accounts to compensate for part of the loss.

In essence, the administration is betting that the markets will stomach even large amounts of explicit new debt for a Social Security plan that reduces the so-called implicit debt of unfunded future obligations.

The administration says it is finding plenty of Wall Street support for that logic. But some financial traders consider it more wish than forecast. They believe the markets will weigh the reality of massive new federal borrowing more than the promise of long-term savings — especially if the plan defers any benefit reductions far into the future, as seems possible.

"In an ideal world, the market would say, 'Good, they're doing something to fix Social Security,' " says Ethan Harris, chief U.S. economist for the investment firm Lehman Brothers. "But I think the market will focus almost exclusively on the increased deficit."

If Harris is right, that would mean higher interest rates — and bigger bills for mortgages and consumer loans.

Piratization!

Bush's Social Security Plan Would Fix Nothing

Nice analysis... I think $10.4 trillion is an exaggeration, but otherwise he hits the nail on the head.

Dec. 20 (Bloomberg) -- President George W. Bush talked at length last week about the long-term problems facing Social Security with its huge $10.4 trillion unfunded liability.

``The crisis is now,'' he said.

Then Bush described at length the glories of allowing workers to divert a portion of their payroll taxes to fund private investment accounts that would earn a better rate of return than the Social Security trust fund, accounts whose assets could be left to heirs.

``One of my strong beliefs is that all public policy, to the extent possible, ought to encourage ownership in America. I believe in owning things,'' the president said, to applause at the White House economic summit.

Not once, not once, did Bush acknowledge that the creation of private accounts actually would do nothing to make Social Security solvent in the long run. In fact, by itself, diverting a portion of payroll taxes makes the problem worse, not better.

Nor did Bush mention that, with the federal budget already deep in deficit, the government would need to borrow an additional $100 billion or more a year from the public to buy the private sector assets going into the private sector accounts.

Of course there was no need to mention that small point because the official administration line is that the added borrowing would have no impact on Treasury yields.

Alabama

Senate:

Senator Jeff Sessions (R)
Unknown

Senator Richard Shelby (R)
Strongly For

House:

1 Jo Bonner (R)
Unknown

2 Terry Everett (R)
Unknown

3 Mike Rogers (R)
Unknown

4 Robert B. Aderholt (R)
Unknown

5 Robert E. (Bud) Cramer, Jr. (D)
Unknown

6 Spencer Bachus (R)
Unknown

7 Artur Davis (D)
Unknown

Alaska

Senate:

Senator Ted Stevens (R)
Unknown

Senator Lisa Murkowski (R)
Unknown

House:

1 Don Young (R)
Unknown

Arizona

Senate:

Senator Jon Kyl (R)
Strongly For

Senator John McCain (R)
Unknown

House:

1 Rick Renzi (R)
Unknown

2 Trent Franks (R)
Unknown

3 John B. Shadegg (R)
Unknown

4 Ed Pastor (D)
Unknown

5 J. D. Hayworth (R)
Unknown

6 Jeff Flake (R)
Unknown

7 Rau´ l M. Grijalva (D)
Unknown

8 Jim Kolbe(R)
Unknown

Arkansas

Senate:

Senator Mark Pryor (D)
Strongly Against

Senator Blanche Lambert Lincoln (D)
Strongly Against

House:

1 Marion Berry (D)
Unknown

2 Vic Snyder (D)
Unknown

3 John Boozman (R)
Unknown

4 Mike Ross (D)
Unknown

California

Senate:

Senator Dianne Feinstein (D)
Unknown

Senator Barbara Boxer (D)
Unknown

House:

1 Mike Thompson (D)
Unknown

2 Wally Herger (R)
Unknown

3 Daniel E. Lungren (R)
Unknown

4 John T. Doolittle (R)
Unknown

5 Robert T. Matsui (D)
Unknown

6 Lynn C. Woolsey (D)
Unknown

7 George Miller (D)
Unknown

8 Nancy Pelosi (D)
Strongly Against (Thanks to Bhaal)

9 Barbara Lee (D)
Unknown

10 Ellen O. Tauscher (D)
Unknown

11 Richard W. Pombo (R)
Unknown

12 Tom Lantos (D)
Unknown

13 Fortney Pete Stark (D)
Unknown

14 Anna G. Eshoo (D)
Unknown

15 Michael M. Honda (D)
Unknown

16 Zoe Lofgren (D)
Unknown

17 Sam Farr (D)
Unknown

18 Dennis A. Cardoza (D)
Unknown

19 George Radanovich (R)
Unknown

20 Jim Costa (D)
Unknown

21 Devin Nunes (R)
Unknown

22 William M. Thomas (R)
Unknown

23 Lois Capps (D)
Unknown

24 Elton Gallegly (R)
Unknown

25 Howard P. ‘‘Buck’’ McKeon (R)
Unknown

26 David Dreier (R)
Unknown

27 Brad Sherman (D)
Unknown

28 Howard L. Berman (D)
Unknown

29 Adam B. Schiff (D)
Unknown

30 Henry A. Waxman (D)
Unknown

31 Xavier Becerra (D)
Unknown

32 Hilda L. Solis (D)
Unknown

33 Diane E. Watson (D)
Unknown

34 Lucille Roybal-Allard (D)
Unknown

35 Maxine Waters (D)
Unknown

36 Jane Harman (D)
Unknown

37 Juanita Millender-McDonald (D)
Unknown

38 Grace F. Napolitano (D)
Unknown

39 Linda T. Sa´nchez (D)
Unknown

40 Edward R. Royce (R)
Unknown

41 Jerry Lewis (R)
Unknown

42 Gary G. Miller (R)
Unknown

43 Joe Baca (D)
Unknown

44 Ken Calvert (R)
Unknown

45 Mary Bono (R)
Unknown

46 Dana Rohrabacher (R)
Unknown

47 Loretta Sanchez (D)
Unknown

48 Christopher Cox (R)
Unknown

49 Darrell E. Issa (R)
Unknown

50 Randy ‘‘Duke’’ Cunningham (R)
Unknown

51 Bob Filner (D)
Unknown

52 Duncan Hunter (R)
Unknown

53 Susan A. Davis (D)
Unknown

Colorado

Senate:

Senator Wayne Allard (R)
Unknown

Senator Ken Salazar (D)
Strongly Against

House:

1 Diana DeGette (D)
Unknown

2 Mark Udall (D)
Unknown

3 John T. Salazar (D)
Unknown

4 Marilyn N. Musgrave (R)
Unknown

5 Joel Hefley (R)
Unknown

6 Thomas G. Tancredo (R)
Unknown

7 Bob Beauprez (R)
Unknown

Connecticut

Senate:

Senator Joe Lieberman (D)
Unknown

Senator Christopher J. Dodd (D)
Strongly Against (Thanks to Alex T.)

House:

1 John B. Larson (D)
Unknown

2 Rob Simmons (R)
Strongly Against (Thanks to Alex T.)

3 Rosa L. DeLauro (D)
Unknown

4 Christopher Shays (R)
Unknown

5 Nancy L. Johnson (R)
Unknown

Delaware

Senate:

Senator Thomas R. Carper (D)
Unknown

Senator Joseph R. Biden, Jr. (D)
Unknown

House:

1 Michael N. Castle (R)
Unknown

Florida

Senate:

Senator Bill Nelson (D)
Unknown

Senator Mel Martinez (R)
Strongly For

House:

1 Jeff Miller (R)
Unknown

2 Allen Boyd (D)
Unknown

3 Corrine Brown (D)
Unknown

4 Ander Crenshaw (R)
Unknown

5 Ginny Brown-Waite (R)
Unknown

6 Cliff Stearns (R)
Unknown

7 John L. Mica (R)
Unknown

8 Ric Keller (R)
Unknown

9 Michael Bilirakis (R)
Unknown

10 C. W. Bill Young (R)
Unknown

11 Jim Davis (D)
Unknown

12 Adam H. Putnam (R)
Unknown

13 Katherine Harris (R)
Unknown

14 Connie Mack (R)
Unknown

15 Dave Weldon (R)
Unknown

16 Mark Foley (R)
Unknown

17 Kendrick B. Meek (D)
Unknown

18 Ileana Ros-Lehtinen (R)
Unknown

19 Robert Wexler (D)
Unknown

20 Debbie Wasserman Schultz (D)
Unknown

21 Lincoln Diaz-Balart (R)
Unknown

22 E. Clay Shaw, Jr. (R)
Strongly For (Thanks to Molly B.)

23 Alcee L. Hastings (D)
Unknown

24 Tom Feeney (R)
Unknown

25 Mario Diaz-Balart (R)
Unknown

Georgia

Senate:

Senator Saxby Chambliss (R)
Unknown

Senator Johnny Isakson (R)
Unknown

House:

1 Jack Kingston (R)
Unknown

2 Sanford D. Bishop, Jr. (D)
Unknown

3 Jim Marshall (D)
Unknown

4 Cynthia McKinney (D)
Unknown

5 John Lewis (D)
Unknown

6 Tom Price (R)
Unknown

7 John Linder (R)
Unknown

8 Lynn A. Westmoreland (R)
Unknown

9 Charlie Norwood (R)
Unknown

10 Nathan Deal (R)
Unknown

11 Phil Gingrey (R)
Unknown

12 John Barrow (D)
Unknown

13 David Scott(D)
Unknown

Hawaii

Senate:

Senator Daniel K. Inouye(D)
Unknown

Senator Daniel K. Akaka (D)
Unknown

House:

1 Neil Abercrombie (D)
Unknown

2 Ed Case(D)
Unknown

Idaho

Senate:

Senator Larry E. Craig (R)
For

Senator Mike Crapo (R)
Unknown

House:

1 C. L. ‘‘Butch’’ Otter (R)
Unknown

2 Michael K. Simpson (R)
Unknown

Illinois

Senate:

Senator Richard J. Durbin (D)
Strongly Against

Senator Barack Obama (D)
Unknown

House:

1 Bobby L. Rush (D)
Unknown

2 Jesse L. Jackson, Jr. (D)
Unknown

3 Daniel Lipinski (D)
Unknown

4 Luis V. Gutierrez (D)
Unknown

5 Rahm Emanuel (D)
Unknown

6 Henry J. Hyde (R)
Unknown

7 Danny K. Davis (D)
Unknown

8 Melissa L. Bean (D)
Unknown

9 Janice D. Schakowsky (D)
Strongly Against - "I believe that privatizing Social Security raises several
problems..." (Thanks to Mark P.)

10 Mark Steven Kirk (R)
Unknown

11 Jerry Weller (R)
Unknown

12 Jerry F. Costello (D)
Unknown

13 Judy Biggert (R)
Unknown

14 J. Dennis Hastert (R)
Unknown

15 Timothy V. Johnson (R)
Unknown

16 Donald A. Manzullo (R)
Unknown

17 Lane Evans (D)
Unknown

18 Ray LaHood (R)
Unknown

19 John Shimkus(R)
Unknown

Indiana

Senate:

Senator Richard G. Lugar (R)
Unknown

Senator Evan Bayh (D)
Unknown

House:

1 Peter J. Visclosky (D)
Unknown

2 Chris Chocola (R)
Unknown

3 Mark E. Souder (R)
Unknown

4 Steve Buyer (R)
Unknown

5 Dan Burton (R)
Unknown

6 Mike Pence (R)
Unknown

7 Julia Carson (D)
Unknown

8 John N. Hostettler (R)
Unknown

9 Michael E. Sodrel (R)
Unknown

Iowa

Senate:

Senator Tom Harkin (D)
Strongly Against

Senator Charles "Chuck" Grassley (R)
Unknown

House:

1 Jim Nussle (R)
Unknown

2 James A. Leach (R)
Unknown

3 Leonard L. Boswell (D)
Unknown

4 Tom Latham (R)
Unknown

5 Steve King (R)
Unknown

Kansas

Senate:

Senator Pat Roberts (R)
Unknown

Senator Samuel D. Brownback (R)
Strongly For (Thanks to Max R.)

House:

1 Jerry Moran (R)
Unknown

2 Jim Ryun (R)
Unknown

3 Dennis Moore (D)
Leaning Against (Thanks to Max R.)

4 Todd Tiahrt (R)
Unknown

Kentucky

Senate:

Senator Mitch McConnell (R)
Unknown

Senator Jim Bunning (R)
Unknown

House:

1 Ed Whitfield (R)
Unknown

2 Ron Lewis (R)
Unknown

3 Anne M. Northup (R)
Unknown

4 Geoff Davis (R)
Unknown

5 Harold Rogers (R)
Unknown

6 Ben Chandler (D)
Unknown

Louisiana

Senate:

Senator Mary L. Landrieu (D)
Unknown

Senator David Vitter (R)
Unknown

House:

1 Bobby Jindal (R)
Unknown

2 William J. Jefferson (D)
Unknown

3 Charlie Melancon (D)
Unknown

4 Jim McCrery (R)
Unknown

5 Rodney Alexander (R)
Unknown

6 Richard H. Baker (R)
Unknown

7 Charles W. Boustany, Jr.(R)
Unknown

Maine

Senate:

Senator Olympia J. Snowe (R)
Unknown

Senator Susan M. Collins (R)
Unknown

House:

1 Thomas H. Allen (D)
Unknown

2 Michael H. Michaud (D)
Unknown

Maryland

Senate:

Senator Paul Sarbanes (D)
Unknown

Senator Barbara A. Mikulski (D)
Unknown

House:

1 Wayne T. Gilchrest (R)
Unknown

2 C. A. Dutch Ruppersberger (D)
Unknown

3 Benjamin L. Cardin (D)
Unknown

4 Albert Russell Wynn (D)
Unknown

5 Steny H. Hoyer (D)
Unknown

6 Roscoe G. Bartlett (R)
Unknown

7 Elijah E. Cummings (D)
Unknown

8 Chris Van Hollen (D)
Unknown