Social Security Reform and National Debt
Lindsey Graham is off the reservation. The South Carolina Republican Senator appears to want to make a name for himself as a McCainiac iconoclast. He's arguing that President Bush's Social Security reform proposal to let young Americans invest part of their Social Security payroll taxes in personal retirement savings accounts to help them build real wealth should only be passed if "taxes are on the table." "We need to have everything on the table," he is quoted as saying, "and that includes taxes," Mr. Graham said in an interview on Wednesday. "If you borrow money, that creates a deficit for 50 years to come. It really is a tax on the future, and it is locking the deficit into our national economy in a way that's very unhealthy as far as I see it."
This is extraordinarily foolish. A) Social Security must be reformed. B) The power of growth must be harnessed to provide young Americans with real wealth for real retirement security. C) Politically, President Bush cannot (and will not) come out for any higher taxes. D) Higher taxes are not necessary, because E) THE NATIONAL DEBT IS NOT HIGH BY ANY REASONABLE HISTORICAL COMPARISON!
Sheeessh! I get tired of saying this. There is so much data out there that is so easy to access about the historical levels of debt (or really any other economic data you could want to make comparative points). The national debt in 2003, as we were coming out of a recession and a war, was 36.1% of GDP. The national debt in 1996, when Bill Clinton got reelected, and a time which people look back on as the fields of Elysium in terms of fiscal policy, was 48.5%. Get this straight... the national debt during the Clinton era was higher as a percentage of GDP than it is now!
Moreover, low national debt does not translate into prosperity. The national debt as a percentage of GDP was relatively low, in the mid-20% range, throughout the 1970s, hardly a time of robust economic health.
Lindsey Graham should know better. He's committing Luddite demogoguery that can only serve the entrenched Beltway mob, and does a disservice to Americans looking forward to a new 21st century future in which they can save real money and build real wealth through participation in capital markets outside the buggy-whip level ideas of the original Social Security system.
This is extraordinarily foolish. A) Social Security must be reformed. B) The power of growth must be harnessed to provide young Americans with real wealth for real retirement security. C) Politically, President Bush cannot (and will not) come out for any higher taxes. D) Higher taxes are not necessary, because E) THE NATIONAL DEBT IS NOT HIGH BY ANY REASONABLE HISTORICAL COMPARISON!
Sheeessh! I get tired of saying this. There is so much data out there that is so easy to access about the historical levels of debt (or really any other economic data you could want to make comparative points). The national debt in 2003, as we were coming out of a recession and a war, was 36.1% of GDP. The national debt in 1996, when Bill Clinton got reelected, and a time which people look back on as the fields of Elysium in terms of fiscal policy, was 48.5%. Get this straight... the national debt during the Clinton era was higher as a percentage of GDP than it is now!
Moreover, low national debt does not translate into prosperity. The national debt as a percentage of GDP was relatively low, in the mid-20% range, throughout the 1970s, hardly a time of robust economic health.
Lindsey Graham should know better. He's committing Luddite demogoguery that can only serve the entrenched Beltway mob, and does a disservice to Americans looking forward to a new 21st century future in which they can save real money and build real wealth through participation in capital markets outside the buggy-whip level ideas of the original Social Security system.
posted by PDB at 6:42 AM
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