Next week, Eric Laursen, an independent journalist and activist, will be staying at the Narrow House while he researches the Social Security Administration archives. I was lucky enough to ask him a few questions about the financial/credit crisis in relation to Bush’s defunct privatization plan. Here’s our brief email correspondence:
JS
I was wondering -- out of all the people I know you're probably the best person to ask -- why isn't anyone talking about Bush's failed plan to privatize Social Security now that the credit mess has exposed the disastrous volatility of the deregulated financial system that his administration is responsible for? Seems like it would have been catastrophic if his agenda had been implemented.
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EL
The answer is that it is being talked about - mainly in Florida and Pennsylvania, where there are a lot of retirees, by Obama, because those votes are important to him. McCain, of course, never mentions it.
It's true that Social Security was brought up much, much more often in the previous 2 presidential elections. It was one of the best issues Gore and Kerry had going for them. The reason it's not talked about more widely this time is that the parties' positions on privatization (Republicans for, Dems against) have become so thoroughly baked into their platforms that they're just accepted as such. Not much reason, in the eyes of the mainstream media, to even ask about it.
What's really disturbing is that the deficit hawks have had such a loud voice in the current economic discussions. Every time someone suggests the government do something large-scale to jump-start the economy, they complain that we're ignoring the "generational crisis" of Social Security and Medicare and then call for fiscal austerity, spending cuts, and collective sacrifice. Exactly the wrong medicine at a time like this. But they're powerful people: Paul Volcker is one, and he has Obama's ear.
The real danger, then, is that the supposed long-term problems of Social Security and Medicare could be used as an argument to keep the new administration from doing anything really effective to revive the economy. It ain't privatization (which won't sell at this point anyway), but it would be pretty bad too.
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JS
-- but I'm surprised Obama hasn't used that against the current administration in a hypothetical "what if they privatized Social Security, where would you be now?" kinda way.
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EL
He is doing it to some extent, in the places where it's likely to attract the most votes. But his campaign isn't headlining it elsewhere, and the press isn't picking up on it especially (I've seen just one article, in the NYTimes, focusing on this theme). I suspect partly it's that this is what's known in Washington as a "gotcha," and Obama, trying to take the high road, is inclined not to play that kind of politics. Of course, McCain's playing every gotcha in his book against Obama. But part of the Dems' problem for years has been a certain squeamishness when it comes to this type of thing. One of the reasons they've had so much trouble getting back into power.
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Eric Laursen is an independent journalist and activist who writes frequently on the intersection between economics and the state. He is currently completing a history of the Social Security debate entitled The People's Pension: The Politics of Social Security Since 1980.
