Analysts: Bush Econonomic Plans Mathematically Not Feasible

Bush announced his economic plan yesterday:

  • Social Security will be privatized
  • The tax code will be reformed
  • He will cut the deficit in half

All this, he says, within happen within the next four years. Analysts say his promises likely are a mathematical impossibility:

The deficit in fiscal 2004, which ended Sept. 30, was $413 billion. Under Bush's plan for spending and taxes, the deficit would be $258 billion in 2009. If anything, that may understate the size of the deficit in coming years because it does not include any additional costs for the wars in Iraq and Afghanistan. The Pentagon is expected to seek an additional $70 billion early next year.

Moreover, the president's budget does not include the cost of a Social Security reform plan that includes the personal investment accounts Bush is demanding. Under such a plan, workers would be allowed to divert one-third or more of their share of Social Security taxes into stocks, bonds or other investments.

Because the diverted money would otherwise have gone to existing Social Security beneficiaries, the funds would have to be made up through additional government borrowing or spending cuts

Economics is a little far afield to us. Okay, very far afield. But anything having to do with social security is of concern. Is Bush saying that he's going to allow Joe Shmoe in Valueland put some of the money he should be kicking in for his social security tax into a private investment account?

If so, the analysts say soon there won't be enough money in the social security system to pay existing recipients. Doesn't this mean that when I'm entitled to my social security that I've worked for and contributed to since age 16, I may not get it because a congregation of Joe Shmoes in Valueland decided to put their share in Walmart stock?

The analysts in the article seem to be saying that the only way future recipients all can be paid is if the Government kicks in the amount these Valueland Joes put in their Walmart accounts. Only the Government won't be able to do that, because it doesn't have the money, because of the deficit, and because Bush says he won't raise taxes when he reforms the tax code. And if there's less money in the pot, and the Government doesn't make it up, the only other option is cuts to retirees.

This is just too depressing on top of the news that we are now subject to this President's "exenditure of his political capital" for another four years. Welcome to the Funhouse called Valueland.

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