Wednesday, June 08, 2011

Social Security Under Attack Again! Pay no Attention.

Here is something that gets no attention because of the Wienergate:
House Republicans on Friday introduced legislation that would allow workers to partially opt out of Social Security immediately, and fully opt out after 15 years.
Rep. Pete Sessions (R-Texas), who chairs the National Republican Congressional Committee, and several other Republicans introduced the Savings Account for Every American (SAFE) Act. Under the bill, workers would immediately have 6.2 percent of their wages sent to a "SAFE" account each year.
Back to killing Social Security! Those guys work hard, I must admit. Bush just tried doing this, unsuccessfully, and here we are again.

But look at the proposal! Calling those accounts "SAFE!" As far as I can tell, they are going to be totally unprotected accounts in the financial markets.

This is really interesting to think about. First, risk will be passed back to the individuals. There will be no guarantees that the money will still exist when the individual retires. Second, the current system works as an income transfer program, giving more to the poor than they contributed and less to the wealthy than they contributed. Guess what this proposal does to that aspect? Third, guess what will happen to the existing system when those with the highest personal incomes opt out. It will be killed.

The impact on women is particularly interesting. It is of the same paradoxical type as those conservative initiatives which cut off all help for poor women with children and then demand that abortion be made illegal.

The similarity is in the fact that women who behave the way the conservatives wish them to will suffer. A woman choosing to have the child under difficult economic conditions might then lose it to lack of health care and income assistance. And if the traditional income-transfers of the current Social Security system die, it is those women who follow the conservative rules by staying at home who will suffer. Not just them, of course, as women earn less, on average, but it is astonishing that these paradoxes are sorta hidden from the general debate.

Other examples of them abound: Cut back on nursing home care and have the women care for the elderly and the sick at home. Cut back on money for schools and have the women teach the children at home. It's a double-whammy because the people losing their jobs in those industries are also mostly women.