From Holden:
Chimpy took his Social Security destruction tour to North Carolina today. Here are some lowlights.
He opens with a general discussion of issues other than demolishing the most successful social welfare program in history. In this instance, the federal budget.
I believe the job of a President is to confront problems and not pass them on to future Presidents and future generations. That’s what I believe.
On the importance of keeping political promises.
For those who got to worry about the politics of Social Security, let me just give you my perspective. I ran on it, twice. (Laughter.) I said, elect me and I will do the best I can to work with Congress to strengthen the system for all; give me a chance to be the President and I will take the issue head on. I did so in the 2000 campaign. Obviously, the issue wasn’t solved, and so I did it again in 2004.
Yesterday he stunningly asserted that there is no Social Security trust fund and Treasury bonds aren’t worth the paper they are printed on. I have a feeling that Alan Greenspan or John Snow had a little conversation with him on that suject, as today he asserted that there is no Social Security trust bank. However, I’m still not sure his words will soothe anyone holding bonds.
Now, some of you probably think there is a kind of — a bank, a Social Security trust bank. But that’s not what’s happened over time. Every dollar that goes into Social Security has been paid out, either to retirees or government programs. It is a pay-as-you-go system; it is a flow-through system. There is no kind of — there are empty promises, but there’s no pile of money that you thought was there when you retired. That’s not the way the system works.
The death of the “C” word.
And so step one of my strategy is to continue saying to the American people, we have got a serious problem. In other words, sometimes they say, is it serious, is it a crisis — look, whatever you want to call it, just look at the chart and you come up with the conclusions.
The miracle of compound interest.
And so — that’s called the compounding rate of interest. Just trying to show off a little bit, kind of — (laughter.) Not bad for a history major. (Laughter.) Let me give you an example of what I’m talking about.
[snip]
Now, if you’re a worker who earns $35 a year over your lifetime, and this system were in effect where you could put 4 percent of your payroll taxes in a personal account, and you start at age 20, by the time you retire, your personal account would grow to $250,000. That’s compounding rate of interest.
Your money to spend as you like, except…
It’s your money to begin with, and it’s your money at the end. And you can do with it what you want. You can’t take it to the lottery, you can’t gamble, you can’t try to increase it with silly investments, and you can’t pull it all out at once. In other words, you have to use it for retirement.
The return of president asshole.
THE PRESIDENT: Andrew has a PhD, by the way. (Laughter.) Which — it’s an interesting lesson for those of you who are worried about your college career. Andrew has a PhD, and I got a C. (Laughter and applause.) And look who’s working for who. Anyway — (laughter.)
There was one good question for which he really had no answer.
Q Thank you. I have a question about Social Security benefits that are related to things other than retirement, which is what you’ve put a lot of focus on. In 2001, I lost my father, and he left behind my mother to raise three kids, all under 18, and pay for everything that they needed and support them financially. By the year 2042, this pay-as-you-go situation is going to be pretty much exhausted. If that happens to someone after that point, they’re going to pretty much be depending upon this small percentage that the government is allowing them to put into their nest egg fund. At that point they have to pull out of funds early. Their index funds they’ll have to pull out of early, which won’t get to grow very much; and their long-term bonds won’t mature. So how does your plan really —
THE PRESIDENT: On survivor benefits? Are you talking about survivor benefits under the current system?
Q Yes. Yes, sir.
THE PRESIDENT: First of all, the plan is only addressed to the retirees, not to the disabled and survivor benefits. In other words, we’re focused on the retirement aspect of Social Security. Secondly, the notion that a personal account — frankly, we haven’t got to the emergency withdrawal aspects of the personal account. The idea, though, is not to let people — the main principle is not to let people withdraw money, who’ve retired, from the personal account because it needs to be used for retirement. In other words, you can’t just lump-sum it out. This is a complement to Social Security.
Finally, what would any conversation about Social Security be without the requisite number of ass-kissers?
THE PRESIDENT: Noel Council. Where do you live, Noel?
MR. COUNCIL: I live right here in Raleigh; born and raised right here in Raleigh.
THE PRESIDENT: There you go. Did you stay up late last night watching a little basketball? (Laughter and applause.)
MR. COUNCIL: No, but —
THE PRESIDENT: Never mind. Kind of old, us kind of baby boomers, isn’t it, to stay up late. Anyway.
MR. COUNCIL: Yes. I did watch Karl Rove, though, on the Fox channel. (Laughter.)