The American Spectator

p> RIDING THE THIRD RAIL br> Re: David Hogberg’s Social Security Softies : /p> p>David, the opponents of reform are just making any excuse in order to preserve Social Security as an issue against Republicans. Chile privatized in 1980 and it has been very successful. One thing that bugs me, however, is the “conventional wisdom” that there is no trust fund, because someone doesn’t have the cash in a bank vault. The trust fund is a paper obligation, as is a Bank CD. The asset backing the CD is some sort of investment instrument, while the asset backing the Trust Fund is the taxing power of the government, who has borrowed the money without paying a fair return. That we will have to borrow is foregone, but the trust fund exists as a federal obligation and individual records are kept. We should bit the bullet. Switch over to Private now, and then cope with the shortfall. br> — G.B. Hall br> Marietta, Georgia /p>

By setting up personal savings accounts, I have been told by a conservative economist, will take over $50 billion the first year out of Social Security. This amount will increase incrementally every year. To replace this money, one of three things must be done: 1) seriously reduce benefits. This will happen if the money to pay the benefits is not there, 2) raise taxes. Either raise the amount that is taxed above $89,500, or raise everyone’s taxes. President Bush, last week took raising any kind of taxes to solve the problem off the table; 3) continue to borrow the money, and increase the deficits of our country. There is another problem, no one is addressing. Everyone, who knows anything about the stock market, knows that buying and selling shares of stock is not free, everyone knows that there are brokerage fees. Who is going to pay the brokerage fees? Will these fees be taken out of the Social Security money, or will they be deducted from the amount that individuals put into their savings account, or will the government have to borrow more money to pay these fees. No one is talking about this!

p>My real problem with these types of programs is the same with any and all privatization programs. Why should the government collect taxes, then turn this money over to a private business so that business can make money off of it? Here in South Carolina where I live, the state owns the school bus fleet. There is talk of privatizing it, so the taxpayers will save money. A private company will be given ownership of the bus fleet. My problem is that the taxpayers have bought these busses, but the proposal will turn ownership over to a private company, This company will not have to invest any of its money into becoming the owner of the fleet. Then the company will be given the tax money once spent on operating these busses. They are supposed to improve the system, while reducing the cost to the state. However, what company is going to become involved in this scheme without the potential of making a profit. The first thing it will do is set aside the money it needs to make its profit. Now the school bus system has less money to operate the system. Yet the state tells us this can be done by spending less taxpayer’s money on the buss system. There will be losers, those families which depend on this system to get their children to school. The only winners will be the company that got the contract. Programs like these are nothing but rip-off taxpayer’s money to benefit those who have the political pull to grab up these contracts. br> — Jim