Saturday, January 15, 2005

How credible are President Bush's dire predictions?

Money Quote: " In the early 1980’s a bipartisan group of lawmakers and business leaders, under the direction of Alan Greenspan, came up with a solution that put the system on a path that is projected to keep it solvent until 2042 or 2052, according to the most widely accepted estimates.
Nancy Altman, who was an aide to Greenspan on the Social Security commission, remembers "exactly the same kind of hype" as we are seeing today. "It was exactly the same — the sky is falling," said Altman.
The difference is that the problems facing the system in the 1980s were truly urgent. "It really was a crisis," said Mary Falvey, a member of the Greenspan commission. She remembers being told that Congress had to act by April 1983 to keep the Social Security checks from grinding to a halt two months later.
This time around, Social Security is years away from anything that honestly could be described as a financial crisis. But that has not stopped President Bush from trying to whip up enthusiasm for his proposed personal retirement accounts by warning of an imminent disaster."

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