Scarecrow says:

And here’s a warning from my experiences with electricity markets. Private contract marketers have strong incentives to undermine the pool’s effectiveness, because the pool is a competitor, or it at least defines the competitive standard. They may try to convince government to limit what services the pool can provide, or limit who can buy from the pool, or convince the pool to use pricing mechanisms that are inefficient. All of these tactics make it more likely that buyers — and consumers like us — will have to turn to private contract marketers and pay more for fewer choices, because the pool choice is either missing or unattractive.

Can we say Enron?

OT from previous thread – I left a question in re: Maureen O’Hara movie…

ENRON. And price-fixing. And screwing the California consumer in the process. Yeah, we can say Enron. Can we say “selling the country to the highest bidder” and “Impeach Now”?

We need MEDICAL CARE.

Sheesh — what’s so hard to grasp about that?

Coming soon…Dirty Fucking Hippies Synchronously Inverting Sunshine.

TeddySanFran @ 32

So, Scarecrow — the GOP/BushCo plan was to game Social Security by tying its payout to The Stock Market, removing its pool protectivity while recompensing money managers generously?

Using my frame, the privitization scheme was to divert the pool of SS taxes from the SS pool (trust fund) to private accounts, managed by private financial institutions.

Krugman addressed the questional economics, as you recall. The intellectual dishonesty was the claim that we needed private accounts and didn’t have them yet. That was nonsense. We have 401k and 457 private accounts, plus other pension and other retirement plans at work; or we can buy insurance, or put money in a savings account or invest in stocks. The private market was already there. What Bush wanted was to reduce the amount of money going to the pool = SS system, and divert to to even more private accounts.

In addition, the plans created by his “commission” (made up of course by major bankers and financial players) lacked the “transferability” of actual savings accounts or true private investments. So while the stock market would expand (and guess who’s stock values would rise the most…those who already were invested BEFORE the plans came into law) the employees would have to purchase split stocks from other investors (i.e. those that made the plans). And the palns really were not disposable. One couldn’t access the profits until one retired, and even then they were shifted to annuities. So no purchasing that business, home, or taking that world vacation with a large withdrawal.

Initially the “employees” would see huge increases in their (sequestered) private funds. They couldn’t access that money, but they’d be exceeding the gains made by the more cautious SSI by leaps and bounds, ON PAPER. THAT would make everyone THINK that this was a great policy decision. But then the demographic “bubble” would be reached and the losses would be equally immense.

And get this! The plans eliminated the matching contribution made by employers to the SSI! These private plans essentially cut the amount put into an SSI account by 50% (unless, of course, the worker opted to double their payments. So the Bush plans eliminated that “onerous” SSI contribution made by businesses…and large employee heavy firms like Walmart, McDonalds, etc. would make billions more every year as their employee paychecks were cut.

At some point the amount of $$$ coming in plateaus. The wealthy can pull their money out of the market well before that “bubble” is reached. These “private retirement plan” holders have no such flexibility. They’d have to stay in…and get screwed.

And then there’s the simple fact that the SSI program wasn’t on the verge of bankruptcy and could be fixed by some simple adjustments. Even the income/outlay point was some 30 years from now, with possible bankruptcy a decade or more after that! But by withdrawing millions of workers from it -SSI WOULD soon go bankrupt (particularly because the system has been abused by taking funds from it to fund things like Iraq!). Probably by 2016! Then the PUBLIC would be stuck with a $10 trillion dollar bailout of the system to pay all future benefits from those already retired.

With less than a quarter of that same $10 trillion the system could be fixed well into the next century!

Pretty obvious which was the better deal.

TeddySanFran @ 115

Okay, I’ve ordered Conspiracy of Fools — with FDL recommenders, how can I lose?

Tricked me. Thought you had a new thread up.

Pach has a new thread. Teddy’s just buying a book.