When it comes to entitlement "reforms," lately we tend to think of Republican efforts to end Medicare's guaranteed benefit and replace it with a private voucher scheme. It's worth noting, however, that the GOP hasn't given up on privatizing Social Security, either.
On "Fox News Sunday," for example, Newt Gingrich said he'd like to see the United States adopt Chile's system.
Associated Press
Gingrich still loves Pinochet's pension "reforms."
"Back in 1983, the last time we've tried to fix social security, if we had adopted a Chilean model where people have a personal account, there'd be $16 trillion in savings. Right today," the Republican presidential contender said on "Fox News Sunday."
"That's how much the build-up would have been, just based on what's happened in Chile, which is not a theory. It's actually happening," he said.
Just so we're clear, Gingrich is saying the United States shouldn't have gone with Reagan's Social Security reforms, but rather, should have gone with reforms pushed by ... Chilean dictator Augusto Pinochet.
But putting this aside, there are two larger problems with Gingrich's argument. First, in Chile, the public was confronted with a little something known as a mandate -- folks were required to purchase private investment accounts. Even Republicans, for all of their rhetorical acrobatic skills, may find difficult in the future to say federal mandates for investment accounts are fine, but federal mandates for health insurance are a communist plot to destroy civilization.
Second, Chile's system was fine for everyone except the people who needed it: retirees. Many Chilean retirees ended up getting shafted -- hidden fees "soaked up as much as a third of their original investment" -- and would have been better off if they'd stuck with the public system before
This angle came up a bit in 2005, during the Bush/Cheney privatization effort, but so long as prominent Republicans continue to push the Chile line, it's worth remembering how misguided the policy is.
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Plus, there was that whole thing about torturing dissidents who opposed the reforms, but since when does the GOP care about torture?
Wow...just wow. The GOP is projecting fascism so loud it's deafening them. HOW did we come to this? It is time to enact single payer healthcare and get all these fruitcakes on meds! Stat! Then, please, can we return to something resembling normal life?
There were also those protestors that were demanding Pinochet returned to stand trail for murder. But let US not let that "pesky old truth" get in the way of the GOP reverie....
Don't forget recessions, market fraud, banking fraud etc. Some idiot wrote to my local paper saying "If you would buy oil stocks you wouldn't complain about gas prices" If I can not afford gasoline, how could I possibly afford petroleum stock? What world do these people live in?
The Republicans do not have a problem with mandates. They have a problem with mandates enacted by Democrats. They would be more than happy to mandate prayer in schools, and invasive medical screenings for women, etc.
How many times police allow rolling stops at stop signs, do not enforce pulling of permits, and countless other selective enforcement that leaves everyone guessing about what is required and what is not. Should you come to a complete stop at a stop sign? What if you are in an older car? Do you think there is a better chance you will receive an enforcement action than someone in a new car who does not wear a backwards hat? The point is in part that we have a lot of laws on the books already, but they are so randomly enforced, it is hard to believe the Courts actually allow this, and the citizens also do not seem to care.
And look at Chile today. Sure Santiago downtown looks like something out of Orange County (CA or FLA, take your pick) but the favela that stretches for miles and miles and miles along the railroad tracks, on both sides, leaving Santiago tells a tale all its own.
So Newtered proposes following the example of one of the most undemocratic regimes in history? OK, then. I propose following the exact same path. Let's follow the Syrian model, the North Korean model, and the Iranian model.
Oh, and don't forget the Chilean government's habit of tear-gassing students who want a restoration of education subsidies that Pinochet eliminated:
http://www.nytimes.com/2012/04/08/magazine/camila-vallejo-the-worlds-most-glamorous-revolutionary.html
Oh, wow did they not think this wouldn't be analyzed? Oh, yeah our money won't be worth a damn once we retire here. We'll be finished off once we have to be hospitalized. If the hospitals ever start refusing patients I would say it would take about probably 5 more years and then that would show a significant amount of lives lost. They need to do an investigation on how many poor people have been dying lately due to an illness in which they did not get the proper health treatment in order to prevent the disease or they did not go to the doctor on time because they didn't have enough money. How many people are dying each day because they have been misdiagnosed. God forbid that these Physicians are rascists or prejudice in any way. If Arizona has control over doctors and what he needs to tell his patients what else do they have control of? Are they asking Doctors to kill for them? Are they asking Doctors to treat only rich White people. Are they asked and told to give poor people less care? Who are the majority of poor people? What class of people are not getting Health Care? The elderly because they're old anyway so who cares they're gonna die soon. Why waste money taking care of them. Single un-wed mothers have it pretty rough. Unless they can live with their parents until they get a career going.It does cost a lot to take care of women, but can men really live without us? So, they're just going to make us pay for our own healthcare. Every single human being deserves the best available healthcare that is available to them and if they can't afford it we need to find a way to help them to. The GOP needs to stop killing people by denying them healthcare.
Here is a debunking of this fantasy by Paul Krugman about two years ago.
http://krugman.blogs.nytimes.com/2010/03/03/fantasies-of-the-chicago-boys
As usual a good read.
I remember the words of one of my college finance professors - very smart man - had experience in the commodities market. He said that the only way for a trader to consistently perform above average in the market was to have inside information.
Even having an MBA is no guarantee that you would be able to maintain a dependable retirement fund - the trend is for less and less regulation in the financial markets. Look what the industry did to one of the average person's primary investments - their home. A billionaire can lose half of his wealth and still have a pretty good life - a 70 year old retired school teacher cannot.
So the question is "Are you feeling lucky?"
Well you can trust Social Security which with the very generous assumptions of SSA will net you $0.80 on the dollar PRE-TAX. Maybe you make money in the market or lose it. With Social Security it is an automatic loss even for the smart man.
The reason that a 70 year-old retired school teacher can't is because he or she paid into Social Security for 49 years on losing terms.
It's easy enough to do away with Social Security. Just accept a much higher level of poverty among retired people. What's the problem?
So you just accept a much higher level of poverty in the young? According to Pew Research, poverty in the 35 and under set has exploded higher just coincidently almost to the year that SS taxes were raised in earnest.
It's hard to keep Social Security because even poverty in the 35 and under set, doesn't fix the system.
Gingrich is living in fantasy land. The value of those private accounts would have significantly dropped if the money was in the stock market. The Occupy movement would be a walk in the park compared to people's anger if those funds were in private accounts. I cannot imagine many people would trust their SS accounts with Wall Street after the Bush Depression.
The Chilean social security system, imposed by force by the Pinochet regime, is actually worse that what Steve Benen says. A Chilean worker who retired in 2005 received less than half of what he/she would have received had s/he been able to remain in the old system: http://www.zcommunications.org/collecting-social-security-at-100-by-site-administrator. But the entire system is based on blind adherence to ideology: http://wp.me/p2cpPS-5. That is, of course, because Wall Street makes money when he hand our retirement money to them. Gingrich says there is no money for social security, but seems there is plenty of money laying around for his fantasies of millions living on the moon. Crazy.
They're sure throwing around a lot of money on these campaigns and Super fat jack pacs.
www.zcommunications.org seems to redirect me to www.MyDaddyToldMeSo.Com. Do you have a better source?
So we take $12 + trillion of dollars from a public trust and put it into the excited hands of the private market and hope they do the right thing.... brilliant Newt... what could possibly go wrong?
If Newt truly wants to be relevant today he should tell the truth about GOP policies and goals. He could sell enough books to stop his seminars.
Our site publishes information on all plans, and we get mixed data on Chile and its results.
What is your source for : " hidden fees "soaked up as much as a third of their original investment" -- and would have been better off if they'd stuck with the public system before"