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April 07, 2009

Hoping to Build On History's Greatest Rip-Off By Making It Even Greater

Dean Baker, in this USA Today op-ed about Social Security, points out something no one else has:

In effect, the cutters are proposing that the government default on the bonds held by the Social Security trust fund: U.S. government bonds that were purchased with money raised through the designated Social Security tax.

It is truly incredible, and unbelievably galling, that anyone in a position of responsibility would suggest defaulting on the government bonds held by the Social Security trust fund at the precise moment that the government is honoring trillions of dollars of bonds issued by private banks.

While the government has no legal or moral obligations to pay off the banks' debts to wealthy investors (who presumably understood the risks they were taking), the Social Security bonds carry the full faith and credit of the U.S. government.

It is understandable that people are angry. We have a government and an elite that never stop looking for ways to take money from ordinary workers and redistribute it upward to the richest people in the country.

In case you've missed it, the Federal Reserve has guaranteed gigantic amounts of bonds issued by banks (see "bank debt" here). Thus, as Baker says, the Social Security cutters don't just want us to default on U.S. government bonds essentially belonging to Social Security recipients. They want us to do that at the same time we're paying off Citigroup's bonds.

—Jonathan Schwarz

Posted at April 7, 2009 08:48 PM

Was this in the print USA-Today or only online?

Posted by: Cloud at April 7, 2009 08:58 PM

I don't know. But given that it's illegal for American newspapers to print anything approaching reality about (1) Social Security and (2) the way this country works, I assume not.

Posted by: Jonathan Schwarz at April 7, 2009 09:50 PM

"hey you said you didn't want us to MANAGE your money and now you say we can't just TAKE it and -- i'm really trying here but i think you people need to make up your MIND."

Posted by: hapa at April 7, 2009 11:26 PM

since the front of the url says "" and not just, I'm guessing it was online only.

A recent phenomenon I've noticed is that more and more of the meatier stories get buried in the online blog section of a newspaper without making the regular paper.(not just op-eds.) the NYT's 2008 coverage of the Gravel campaign was actually broader than most NYT readers realize, insofar as they (kinda) kept up with him in the blog section.

Posted by: Jonathan Versen at April 8, 2009 02:43 AM

I've spent much of my life being pissed at current economic and political realities on principle, but if these bastards come after social security after I've been paying huge amounts of my approximately 15,000 a year self-employed income into social security I'm going to start getting personally pissed. Seriously, I get ganked every April 15th for nearly a third of my income, and fuckers like Geithner, Summers, and Obama (currently) want to steal it from me so they can bail out their banker and finance buddies and fund their bombing campaigns? No, fuck you, motherfuckers!

Posted by: Rojo at April 8, 2009 06:11 AM

Well Rojo, d-squared (unless it's some other burritoboy) here hints that maybe it's all for your own good. So stop worrying, go buy a videogame or something.

Posted by: abb1 at April 8, 2009 06:40 AM

It wasn't too long ago that I read something about someone (you can imagine whom) suggesting they go after Social Security. A friend of mine said, "Don't worry, no one from either party is insane enough to go after social security."

As I said, not too long ago.

Posted by: catherine at April 8, 2009 01:12 PM

ALL one need do is say "Crisis" in Washington D.C. and EVERYONE starts slobbering over The Social Security Trust Fund. I've seen it all my life. It's STILL there, nothing's wrong with it. Sad to say, it has always been, and still is an albatross about the neck of SOCIAL PROGRESS toward universal healthcare.

Posted by: Mike Meyer at April 8, 2009 02:11 PM

abb1, what's a burritoboy?

Posted by: Save the Oocytes at April 8, 2009 04:49 PM

Oh, sorry, d-squared is bruschettaboy not burritoboy. My mistake. Never mind.

Posted by: abb1 at April 9, 2009 02:59 AM

Clearly I need to cut down on reading blogs.

Posted by: abb1 at April 9, 2009 03:03 AM

yes you do. :^)

Posted by: abb1b at April 9, 2009 03:52 AM

Why don't we just incinerate the poorest hundred million people in order to warm the brandies of the richest two million?

At least that would honestly reflect the reality of what's going on.

Posted by: Seth at April 9, 2009 07:53 AM

Oh, what BS. First of all, nobody anywhere has suggested "defaulting" on the bonds in the SS trust. And second, I think just rounding up poor people into little camps with barbed wire and barking dogs would suffice, no need to burn them.

Posted by: Mark Nuckols at April 10, 2009 09:14 AM