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« The Blogosphere: Interconnected, But Segmented. | WILLisms.com | Phony Social Security Reform: Adding On Entitlements »

Cheney On Social Security Polling.

For those getting nervous about Social Security polling, here is what Vice President Dick Cheney said:

"The notion that you can lay out something this important, this complicated, that touches hundreds of millions of people and then go take a poll and say, `Oops! Sorry, we're going to stop' makes no sense at all," he said. "A poll's a snapshot in time. We're involved in a major educational effort here."

That is definitely something to remember. A poll is, in fact, a very poor way of measuring levels of public opinion. They are marginally better, however, at measuring differences between and among demographic groups, changes over time, and so forth. Polls are easy to tinker with, manipulating the demographics to engineer outcomes. Question wording and question order can also markedly affect the results of a public opinion survey. Just this week, the Ankle Biting Pundits exposed another in a long line of fraudulent polls:

You'll notice that nearly 20% of the "adult" respondents aren't even registered to vote. Then, note that the partisan breakdown of the poll is 48%-43% Democrat to Republican, even though the national party ID is even at 37%.

An irritating part of the article:

"The position of someone like (Democratic Senate leader) Harry Reid, who said, `Absolutely no, heck no, we're not going to do anything'" would result in a "27 percent reduction in benefits for 30-year-olds by the time they retire," said Cheney, whose schedule may include a stop in Reid's home state of Nevada.

His reference apparently was to the Social Security trustees' forecast that if no changes are made, the system's annual income will cover only 73 percent of its annual expenses starting in 2042.

Democrats haven't yet offered a plan to fix Social Security's projected funding shortfall, but they've signaled a willingness to negotiate a compromise to fix Social Security - as long as private accounts funded by Social Security aren't part of it.

Democrats have not signaled a willingness to negotiate a compromise. Not at all. For that reporter, Tim Funk, to assert that, is absurd. Democrats saying they are willing to negotiate, as long as personal accounts are not part of the reform, is similar to a ski instructor negotiating a ski lesson package, as long as there is no actual snow involved. It would be the same as a team of engineers and architects negotiating the building of a modern skyscraper, but with absolutely no steel or glass. Or a landscaper negotiating the renovation of a golf course, but only as long as there is none of that pesky grass involved. Or, a teenager negotiating an allowance in exchange for doing certain chores, as long as no actual chores are involved.

You get the idea.

Without personal accounts, there is no long-term, permanent solution for Social Security, therefore taking it off the table completely is nothing less than completely ludicrous.

Also, to buy into the idea that Republicans ought to have to negotiate with Democrats in the first place is to dismiss America's political realignment toward a long-term Republican majority, confirmed in recent elections.

Suggesting that Democrats are a willing party to negotiations at this point, when they have asserted rather stridently that under no circumstances would they allow personal accounts on the negotiating table, is absolute nonsense.

Posted by Will Franklin · 12 March 2005 09:50 PM


This issue is being manipulated by the MSM in the worst possible way and I see no headway being made on it until we address the following issues:

a) Solvency. The system can only "make it" to 2042 if you BELIEVE the government will be able to pay back the $11 trillion it owes the Trust Fund. This amount is equal to more than the current GDP of our country. Fat chance of that happening, but our party allows this critical point to pass virtually without comment. This situation allows people who don't understand the basic laws of mathematics to demagogue the issue and that is a debate killer.

b) Tax increases. Unfortunately, if tax increases would have fixed this tragically flawed program then one of the many tax increases already enacted would have done the job. The laws of economics work against this being a legitimate long-term fix because the program continually penalizes the free market system that feeds it and as long as the program remains outside the free market system's beneficial impact it will continue to absorb more and more resources as surely as God made little green apples, yet no person of courage in our party will stand up and tell the American people the obvious - the goals of social security may be laudable but the means and methods we have embraced to fix it cannot fix it and must be abandoned.

c) Benefit cuts. Benefit cuts change the dynamics of the program by changing the payout. What guarantee is there in an investment that says we will take money from you all your life and someday (if you live long enough) we will give you some money back, the sufficiency of which we cannot commit to because we have already bankrupted the system? Our party is also strangely silent on this critical point of fact and until they bring this home to the electorate we will continue to be pilloried by people like Kennedy (which makes it even more galling).

The reality is that half-measures, half-steps, partial peeks behind the policy curtain, and trial balloons won't suffice. We need a defined policy proposal that addresses this matter that does not include benefit cuts and tax increases in the mix.

Fortunately there are ways to do this right now and fix this fatally flawed program once and for all, but as long as the policy-makers are only going to consider partial privatization, tax increases and benefit cuts as being the only available alternatives, we will continue to be victimized by the outcome.

Today on Chris Matthews' Sunday morning liberal line-up the focus on the debate was on preventing Americans from having access to private investment accounts because they are too stupid to pick the winners and will only continually pick the losers.

This leads to the obvious question of, "what else is out there that can be done?"

The answer is simpler than one might think.

We need to create a new capital market exchange. This exchange will be electronic like NASDAQ, but unlike any other exchange it will not trade stocks or bonds or futures. It will only trade securities pertining to a special class of limited partnership interests called "royalty limited partnerships" (commonly called "RLP's"). RLP's are unique in that they are bankruptcy proof business constructions that are also virtually tort proof. This results in them being relatively immune to the most common forms of investment failure events, and their capitalization structure designs make them incredibly efficient pass-thru income securities that provide an internal rate of return over the long-term ranging between 12% to over 20% per annum. If we created this new exchange platform (called "INSTICERT") and invested the current Social Security Trust Fund INVESTMENT income into this new market (about $80 billion per annum) along with the federal government's income derived from operating this market platform, the result would defease the the current $11 trillion shortfall within 10 years and within 15 years the new platform could sustain social security without further taxpayer contributions.

This is the solution because it is the only solution that will work. If you want to learn more about it just Google "INSTICERT" and read on.

The point here is simple - without the impact of the free market being introduced into the program there will be no fix for our federal tnetilement program funding process that is eating away at our national resources like the cancer it has become.

Posted by: Clint Lovell at March 13, 2005 10:00 AM

That's a great comment, Clint. Thanks.

I plan to explore solvency issues more soon.

Posted by: Will Franklin at March 13, 2005 02:28 PM