Democrat's once again are being played by only seeing the short term in this financial crisis. Let me spell this out is short clear language. The Treasury can buy stock or securities. The US Treasury is enpowered to buy what it wants, with no ability to be sued in court, or to even be challenged by congress. The US Treasury then swaps said assets for funds in the social security trust fund government bonds. Voila! The first step to private social security retirement accounts has been taken! The social security trust fund is now loaded up with stock and investment securities, ready to be down loaded to tax payers. You see this is the lesson from the The Shock Doctrine, Disaster Capitalism.
But democratic leaders are too worried about unitary executive powers congressional oversight, bargaining about adding a small potato stimulus package. Are these important? Yes of course, but these are small prizes, bargain tools. The big prize is Bush's legacy. See Bush was thwarted on privatizing social security. It was one of the first times back in 2005 when democrats formed a united front and stared him down (and one of the few times). But if Bush can leave a legacy of privatizing social security, the right will forgive him all his other big government sins.
Make no mistake social security is the lynch pin of the New Deal, and thus the modern democratic party. It is America's most successful and popular social program. Naomi Klein is warning about it, Now is the Time to Resist Wall Street's Shock Doctrine.:
I wrote The Shock Doctrine in the hopes that it would make us all better prepared for the next big shock. Well, that shock has certainly arrived, along with gloves-off attempts to use it to push through radical pro-corporate policies (which of course will further enrich the very players who created the market crisis in the first place...).
The best summary of how the right plans to use the economic crisis to push through their policy wish list comes from Former Republican House Speaker Newt Gingrich. On Sunday, Gingrich laid out 18 policy prescriptions for Congress to take in order to "return to a Reagan-Thatcher policy of economic growth through fundamental reforms." In the midst of this economic crisis, he is actually demanding the repeal of the Sarbanes-Oxley Act, which would lead to further deregulation of the financial industry. Gingrich is also calling for reforming the education system to allow "competition" (a.k.a. vouchers), strengthening border enforcement, cutting corporate taxes and his signature move: allowing offshore drilling.
It would be a grave mistake to underestimate the right's ability to use this crisis -- created by deregulation and privatization -- to demand more of the same. Don't forget that Newt Gingrich's 527 organization, American Solutions for Winning the Future, is still riding the wave of success from its offshore drilling campaign, "Drill Here, Drill Now!" Just four months ago, offshore drilling was not even on the political radar and now the U.S. House of Representatives has passed supportive legislation. Gingrich is holding an event this Saturday, September 27 that will be broadcast on satellite television to shore up public support for these controversial policies.
What Gingrich's wish list tells us is that the dumping of private debt into the public coffers is only stage one of the current shock. The second comes when the debt crisis currently being created by this bailout becomes the excuse to privatize social security, lower corporate taxes and cut spending on the poor. A President McCain would embrace these policies willingly. A President Obama would come under huge pressure from the think tanks and the corporate media to abandon his campaign promises and embrace austerity and "free-market stimulus."
But does even she sense where this is going? Already calls are being made if the Fed just prints money it will stroke inflation. So where is the largest surplus of AAA rate securities? The Social Security trust fund. Remember the treasury is asking for UNITARY POWERS. Any decision can't be challenged by congress or the courts. Why can't the treasury swap funds form social security with the promise to pay it pack IOU? THe government does this already to fund itself. Once the social security trust fund is loaded with stock won't there be a chorus to return this "upside potential" to citizens. Won't turn the stock over to tax payers seem a wise and logical move? Who would oppose giving the tax payers the assets they purchased. The Blue Dogs? LOL.
It's very easy to imagine this scenario. It would be within the treasuries powers. I could see the right with the logical dissonance suddenly switching from "treasury bad socialism, to treasury good we now have stock/private accounts." Believe me I have seen the right turn suddenly on issue far more fundamental to their beliefs, Beside what recourse would there be. Has this president ever shown restraint? Respect for his "co-equal" branch? Has this Supreme court ever challenged the executive powers of a like minded conservative? It would cry judicial modesty and shuck the issue. I am more convinced by the day that this is the end game. The Government buys into Wall St. This huge Soverign Wealth Fund is set up, and then transferred to the American people (think of the fees generated!?! The Norweigen sovereign wealth fund is called a "pension fund" after all. Is this really such a leap?
So your a skeptic. Maybe dopper1089 is on some conspiracy theory bend. Well how did Chile come to have a semi-privatized social security system? Was it voted on by the people or their democratically elected representatives? No it was forced on them in response to economic shocks. There was "no alternatives", the budget needed to be balanced. This is the way of the shock doctrine. A crisis is used to the advantage of neo-liberal economics. The shock need not be created just exploited. Creating a crisis intentionally is the stuff of conspiracy theorist, using an existing shock to further your goals is the stuff of genius.
For the right it's all about the endgame. It's about losing small battles to shift the Overton Window. eep plucking away keep working until a crisis hits and then spring the trap. What is a stimulus package, if the Fed has the power to buy securities and transfer into the social security trust fund. Does anyone recall what goodies were included in Reagan huge tax cut for the rich? That tax cut was the godfather of the current financial crisis, along with it step mother, the deregulation of our financial system (what goodies were in that bill?). Buy off a few Blue Dogs (Boe Weevils), give a few shootouts to special interest groups, and win the big prize!
I'm convinced this is the "end game". The US Treasury and the Federal Reserve "scream we can't print money, the Chinese and Arabs won't lend it anymore, where else can we go?". Remember another Texan (Lyndon Johnson) raided used the social security trust fund to further progressive ideals with the Great Society Programs. Why wouldn't the right copy him, but twist it to their own ends?
Remember the Shock Doctrine, the right always does.