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Web Letter

I literally can't believe all the drivel that I have read in the letters posted so far. I'm 70 years old and my 401(k) just went south with the stock market (i.e., by at least 1/3). Reagan drove us so far in debt with his military buildup that it took Clinton eight years to climb out and cost the Democrats the Senate and the Congress. Yup, you all are correct, Reagan did drop the taxes on the billionaires and so did our hero Bush. Clinton had to raise taxes on the poor via the fuel tax and every other consumption regressive tax to make up for it. Ain't revisionist history great, eh fellers? I agree, both Reagan and Clinton deregulated the banking industry so they could make big buck$ investing in such secure things as oil, and according to Greenspan they would be able to make credit cheap by spreading the risk through other investments, oops. A gal makes beds at Motel 6 all her life and retires on $500 a month on Social Security, and you think she is stealing from the country, but our CEOS walk off with billions and we celebrate them as heroes and cut their taxes? Is there something in the water?

I wish that there was a floor under Social Security. One trillion dollars for that wonderful war in Iraq, and you want to give all us old geezers a shopping cart and a cardboard box to live in. Do we get a tin cup too? Look, the class war is over and the "rich" have won.

James L. Pinette

Caribou, ME

Feb 15 2009 - 1:36am

Web Letter

The problem with Social Security and the other entitlement programs that are so worrisome to Pete Peterson is that we accumulated adequate surpluses in Social Security to see the baby boomers through their retirement while for thirty years we allowed at least 50 percent of the nation's income to accumulate in the top 1 percent of earners and gave them massive tax cuts to boot. We funded the deficits in the income tax-funded budget that resulted from this policy by borrowing the surpluses in the entitlement funds, and those funds now have to be paid back. That means raising income and Social Security taxes now or in a few years, and that is what Peterson et al. object to. They've run off with the loot and don't want to give it back.

They and the Republicans are the ones who argued that supply-side tax cuts would increase the nation's wealth and tax revenues. They are the ones who have increased military spending but not funded those increases with tax increases. They are the ones who created the budget deficits that now threaten the system. And just as David Stockman once whispered to Bill Greider, they did it to bankrupt the New Deal so that we would not be able to spend any more on social programs.

I mean, Pete Peterson did not object to a 15 percent capital gains tax rate on the $1 billion he took out of Blackstone when it went public. He supported the threat, or was silent, when hedge fund managers said they would leave the country if Congress increased that tax to an earned-income rate. Moreover, this economy was running at a $13 trillion annual rate before the recession hit, so the ostensible $58 trillion shortfall in funding of entitlements represents a little over four years of GDP, while the time horizon over which that $58 trillion will come due is seventy-five years. Assume we produce only $10 trillion of GDP annually for the next seventy-five years. That is $750 trillion, and $58 trillion represents 7.7 percent of economic activity. Even in the current crisis atmosphere, the number $58 trillion should lose some of its power to scare people.

Robert Abbott

Gilbert, AZ

Feb 14 2009 - 4:19pm

Web Letter

I have contacted President Obama and much of the leadership of both House and Senate and told them how to solve the problems of both Social Security and Medicare or healthcare. All without cutting benefits raising age or requirements and or taxes.

They don't want to solve these problems and want the excuse to raise taxes or in some other way take more from the people. Anyone who thinks either party wants to do what's right and fix these problems is very foolish.

My simple way is to start lotteries to fund these things. A well-designed lottery that has many small prizes so people can actually win once in a while and have a chance to win big would be supported beyond belief. If people knew that these supported these important progams and took away the need for more tax money, they would play.

Our government has stolen more from Social Security than we think because had it invested the funds at compound interest instead of spending them, the program would remain sound into the future. It would rather steal more of the people's money in the form of taxes and do less for the people instead of actually doing something that would support these programs and let the people invest in the support of them with a chance to win.

They can't use the excuse that this would be gambling, because gambling is all around us. We gamble every time we vote and with every tax dollar we give them to spend. We have gambled for years our government would work for us, and we keep losing.

Not one person in Washington ever thinks or talks of ways to support the government other than taxes. They complain we don't save constantly and blame that for our problems. We don't save because banks pay no interest, forcing us to the markets to lose our money. I have suggested they sell stock in the government and pay a good rate of interest on it. People need a safe way to save and invest and would gladly buy stock and support the governement. They would rather give our money away and borrow from other countries than to pay a good interest rate. A solvent government and safe savings and investments for the people would do more for the country than saving all the crooked banks and markets we have.

James C. Barnes

Port Charlotte, FL

Feb 13 2009 - 6:33pm

Web Letter

I do not disagree that Ronald Reagan screwed this country. He did so among many other things by (1) drastically reducing the progressive tax rate (the highest bracket went from 75 percent to 35 percent), which changed the behavior of the leaders/CEOs from gaining a long-lasting name (by growing the company and the community) to making a quick buck, stored in tax havens such as Bermuda; and (2) pushing the country too much to the defense sector (with the result that most companies left the consumer market to serve Uncle Sam). But I disagree with members of the left-leaning elite like you as well. Social Security as it is run is (1) a Ponzi scheme where money is taken from one generation and given to other and (2) a white person's welfare (where most folks have been getting much more than what they put in) disguised as something they deserve (most of these guys think of blacks when welfare is mentioned, but would argue that they deserve all the money that they are getting). Any country that adapts such measures to appease the voters is bound to fail and disintegrate. We are unfortunately seeing the first stage of it. As a visible minority, I am worried if the German experience of the 1930s would follow.

Dr. P.A. Ramamoorthy

Cincinnati, OH

Feb 13 2009 - 4:19pm

Web Letter

I find it amusing that the author thinks a government-run pension program would be a better investment vehicle than a 401(k), irrespective of whether there is mandatory savings. Certainly it would be free of direct Wall Street machinations, but do we really trust a Congressman to manage our finances any more than our employers?

Private pensions are only as good as the company you worked for, and any government-run program would have much more indirect and political ways of making individuals make bad investments. Would a government-run pension/retirement plan promote "green" investing? If so, that would be encouraging middle-class individuals to invest in an area better suited to venture capitalists and other rich investors who can afford to lose a high percentage of their investment to a young, unproven business. Would a government program promote investing in the home state of the senator in charge of the committee overseeing said program? Any government program would have significant perverse incentives to it as well, I think.

Also, to pretend that Social Security is not a major issue is quite delusional. The problem is not current retirees, it is those who are about to retire and who will be retiring over the next decade. Trying to blame past government spending and tax cuts for the breakdown of a Ponzi scheme is quite silly. When Social Security started, there were a large number of people who had never paid Social Security taxes who began receiving benefits immediately, i.e., the top of the Ponzi scheme. Such a scheme works as long as the new generation of the pyramid is always at least as wide, or a little wider then the previous generation. That is why Social Security is a long-term problem.

Government deficits can rapidly be erased, as we saw in the 1990s under the bipartisan and more moderate rule of Bill Clinton and the Newt Gingrich Republicans. But a pyramid with a smaller base than peak will never stand up. If you need more information about Ponzi schemes, I would direct you to a Mr. B. Madoff, currently in a penthouse in New York. He should have plenty of information about the creation, management and eventual windup of a Ponzi scheme, and he currently has quite a bit of time with which to teach you all about them.

Brent Lundberg

Dallas, TX

Feb 13 2009 - 3:31pm

Web Letter

Mr. Greider says: "Ever since, working Americans have paid higher taxes on their labor wages--12.4 percent, split between employees and employers. As a result, the Social Security system has accumulated a vast surplus--now around $2.5 trillion and growing. This is the money pot the establishment wants to grab, claiming the government can no longer afford to keep the promise it made to workers twenty-five years ago."

What $2.5 trillion "money pot" is he talking about? The Social Security surplus is debited to its trust fund as non-negotiable treasury bills and the cash is rolled over into the General Fund to pay for yearly appropriations voted upon by Congress such as roads, bridges, welfare etc. There is no money in this "money pot" or trust fund, only federal IOUs.

Mr. Greider should know this. If he does not he is ignorant. If he does, he is at best, disingenuous.

This whole article is based on the false premise that there is money to be stolen where there is none.

Robert J. Lovretich

Niceville, FL

Feb 13 2009 - 10:34am

Web Letter

There are no guarantees and there are no rights. That is a made-up fantasy that is promulgated by all governments in all countries. The money paid as payroll tax is a mandatory payment to Uncle Sam and the government is able to do what it likes with it because it is in possession of it. No one is going to rise in anger or demonstrate in front of the Capitol regarding any changes to Social Security. No one thinks that money is being set aside for them because it isn't. Social Security should be looked at as a gift because it is. Because it is a gift one should not perform a social faux pas by complaining about it.

Robert Karasek

Washington, DC

Feb 13 2009 - 9:52am

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