Abstract

Greenspan's Con Job

The author comments on U.S. Federal Reserve Board chairman Alan Greenspan's call upon the government to cut Social Security benefits. It is not exactly that he lies, but Alan Greenspan certainly ranks among the most duplicitous figures to serve in modem American government. Greenspan is especially destructive when he opines on public matters outside his supposed expertise as a central banker. The Fed chairman's recent remarks on Social Security and the federal budget deficits offer a particularly chilling example. The deficits must be dealt with promptly, he warned, because the baby boomers are about to retire. Then Social Security will be in trouble. And so government must cut benefits now, before it's too late. He is proposing a con job on ordinary working Americans--a bait-and-switch game on a grand scale---in which the payroll taxes they paid into Social Security over many years will now be diverted to other purposes, including the generous tax reductions G.W. Bush has enacted for the very wealthy and the corporations. Here is the truth: Social Security is not in deficit, not now and not for at least the next forty years. The problem is, the government borrowed this money and has spent it on other projects. But the epic swindle may yet fail. Politicians, even the rightwing variety, hesitate to close the deal for fear the "marks"--workers, young and old--might figure it out. Meanwhile, there's one simple and just solution for any long-term fiscal problems Social Security might face: Eliminate the income cap of $87,000 on FICA taxes so that every highly paid worker, even Bill Gates, would pay the full freight.