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Josh Marshall

Josh Marshall is editor and publisher of TalkingPointsMemo.com.

Articles by Josh

The Times-Picayune on the McCrery Waffle ...

McCrery has change of heart

Rep. Jim McCrery, R-Shreveport, who had been publicly skeptical of President Bush's approach to overhauling Social Security, pronounced himself sold last week after a White House meeting. "Frankly, I had not thought of the policy rationale they described yesterday," McCrery said Wednesday after huddling with Allan Hubbard, director of the White House National Economic Council. The comments were something of a turnabout for McCrery and evidence of the administration's interest in lassoing strays from the Republican herd. McCrery joins the president in supporting the idea of private accounts, but he has been publicly wary of the chances of Bush's plan to allow Americans to create them by diverting their payroll taxes. McCrery has said he leans toward another approach for financing the accounts, such as through tax overhaul or more government borrowing. Ten days ago, he warned that the president's plan would give naysayers, such as AARP and most Democrats, a powerful line of attack because it takes resources from the Social Security trust fund. Now it appears McCrery is on board. "I'm convinced the president's approach is worth pursuing in the legislative process," he said after the White House meeting.


Flippity <$NoAd$>floppity.

Is Sen. Landrieu looking to make up for faintheartedness on Social Security with budget moxie?

Check out the new front page of the website ...

Also, we're close to completing our review of Rep. Wilson's application to join the Conscience Caucus. We'll be reporting the decision shortly.

Rep. Heather Wilson (R) of New Mexico <$Ad$>can run. But maybe she can't hide.

You've noticed that we here at TPM have been trying to get to the bottom of her Social Security word games. And just last night we expressed our surprise that no reporters had followed up with her to get to the bottom of her verbal gymnastics about whether she's supporting the president or not.

But it turns out I spoke too soon.

The article isn't in Nexis yet. And the website is subscriber only. So as yet it's hard to know it's out there unless you're a subscriber. But a story did run in the Albuquerque Journal yesterday. And reporter Michael Coleman honed the questions down to good effect.

Here's the key passage from Coleman's sleuthing ...

Rep. Heather Wilson, a Republican congresswoman who represents a swing district where Democrats slightly outnumber Republicans, parted ways with her fellow Republicans on the issue. "I don't believe the government should invest Social Security taxes in the stock market," Wilson told me during an interview for a story that ran last Sunday.

What I should have asked her then was: "Do you oppose allowing individuals to invest part of their share of Social Security in private accounts?"

On Wednesday, Wilson gave me another chance to ask that follow-up question. But she repeatedly declined to answer it. Then she denied playing semantics with the issue.

"I don't play word games and I don't deal with hypothetical situations," Wilson told me. "I try to do things to benefit my constituents."

OK. But, it's curious that Wilson wouldn't answer my follow-up question. Despite her dodge, I'm convinced that Wilson truly does have a deep skepticism about opening Social Security to the volatility of the markets. That's not to say she will definitely vote against some proposal to do so, but I think such a vote would come with a fair amount of personal, or at least political, anguish.


Anguish, indeed.

Later on down in Coleman's piece there's this ...

She said the president's proposal would move the system from a system of defined benefits to a system based on defined contributions.

"And I'm not convinced that's the right way to go," Wilson said.

Wilson seems to be saying she opposes putting Social Security in private accounts— period. She certainly didn't dispute my characterization of her position that way last Sunday. But she's also a politician, and politicians, when possible, like to keep their options open.


So much need to read tea leaves with Rep. Wilson!

Coleman clearly believes that Wilson is in the Conscience Caucus. But the evidence is awfully ambiguous. We're going to review Wilson's application for membership, perhaps even getting a second opinion from our Caucus/Faction outside judge. (Sort of like the ump behind the plate occasionally calls out to first for the call on whether the batter went around -- only the final decision is always with the TPM judge.) But Rep. Wilson, the keys to the Caucus await you! Just say the word!

I must say I'm a little surprised the AP hasn't followed up on their story claiming that Rep. Heather Wilson (R) of New Mexico is opposed to President Bush's Social Security plan. Wilson is a classic Social Security Switch-hitter. And given what we found out last week, it seems pretty clear that Wilson managed to bamboozle the AP into putting her down as opposing the president when it actually seems she's supporting him.

As we noted last week, Wilson's angle is to say she doesn't support having the government invest Social Security money in the stock market. But to her that doesn't rule out creating private accounts invested in the stock market because that's not the government.

In other words, Wilson is relying on the sort of tactic that usually doesn't pan out for five-year-olds when they try to use it in household cookie-jar theft investigations.

Here are some earlier examples of Wilson's switch-hitting ways ...

"I support innovative approaches that would allow working people to put at least some of their Social Security payments into personalized pension funds."

Albuquerque Tribune, May 29th, 1998


"In 1998, Wilson advocated "personalized" retirement accounts that would allow people to determine how some of their Social Security contribution is invested. In 2000, Wilson said she wanted to leave Social Security alone but would consider allowing younger workers to invest in the stock market to increase their benefits. Wilson's camp denies Romero's assertion that she favors privatization. 'The fact is,' Wilson said Saturday, 'that I oppose the government's investment into the stock market and oppose privatization.'"

Albuquerque Journal, April 25th, 2002


"In the past, Wilson has supported plans to allow individual workers to create 'personal accounts' within Social Security. She is no longer talking about that idea, although she hasn't ruled it out, either."

Albuquerque Tribune, September 17th, 2002


"If the federal government invests in the stock market, it will overnight become the largest investor in American business, and I don't think that's right."

Albuquerque Journal, November 1st, 2002


"During the campaign Wilson said she did not favor privatizing Social Security. She said Thursday she would not vote to reduce benefits for anyone in or nearing retirement, increase payroll taxes or allow the government to invest in the stock market. Instead, she would look at plans to encourage individual investment accounts."

Albuquerque Tribune, November 5th, 2004

I keep hearing from TPM readers who've got their noses bent out of shape because it turns out that while their brokers are helping them invest their private savings on the one hand they're trying to pull the plug on Social Security with the other.

We've also heard from folks within the industry who don't like what they're seeing, especially from the real pied pipers of private accounts like Charles Schwab and Edward Jones. Back a few years ago Bill Shipman at State Street Global Advisors was one of the biggest pied pipers. But he's now moved on to other things. So we're not clear on what the situation is there now.

In any case, we'd really like to know more. And since a lot of you seem to know more already, why not let us in on the story?

Which companies are, shall we say, heavily invested in phasing out Social Security? We also hear tell about various pied pipers getting in touch with HR departments to set up workshops about how Social Security is like Wile E. Coyote already out three feet over the cliff. Seen anything like that? Let us know. We even hear that now President Bush is again putting the touch on folks in the business to ante up more money to help him get phase-out back on track. Know more? Let us know.

A glass of sherry or just a cup a' grog?

Rep. Sherwood Boehlert (R) of New York tells the Poughkeepsie Journal he's skeptical about privatization but thinks "everything should be on table to examine from stem to stern."

So Sherry's still a Caucus man, just not Loud and Proud.

The article also gives a good run-down of Social Security politics in the state's dense archipelago of Republican districts.

Some other highlights.

Rep. Sue Kelly (R) says "I think most people agree that Social Security needs to be looked at. People are hung up on that one piece [personal savings accounts]. But I know of six or seven plans that senators and House members are talking about. It's not just private accounts."

That's great. A real profile in courage.

And then there's Rep. Jim Walsh (R), our New York project for the week. A candidate for the Caucus or still hanging tough for W?

Rep. Charlie Rangel (D) of New York: "There is no Democrat in the House of Representatives, on my committee, that this president has reached out for. I'm telling you now, Social Security reform by the president is dead, and he killed it."

From this morning's Meet The Press.

See the video here.

There's been a lot of question about whether Sen. Gordon Smith (R) of Oregon belongs in the Conscience Caucus.

But in today's paper, Portland Oregonian columnist David Sarasohn, asks the man directly.

And Smith tells Sarasohn he deserves in ...

Is the Conscience Caucus the accurate address for him?

"That's an appropriate conclusion," says Smith. "I have not signed up to anyone's plan.

"I'm open to the debate. I'm keeping my counsel."


Sarasohn also asks Sen. Smith the details about President Bush's efforts to lure him out of the Caucus.

Another very interesting nugget from Tom Edsall's piece in the Post on why some non-financial services companies are so keen to start phasing out Social Security ...

Some business groups have calculated that if the Bush Social Security plan fails, pressure will grow to raise payroll taxes to pay future costs of the program. Every percentage point increase would cost corporate employers about $50 billion annually.


Now, the odds <$Ad$> of there being much more than a very slight hike in payroll tax rates (and then possibly only on the employer side) seems pretty long to me. However, what's getting a lot of attention is removing or substantially raising the cap on payroll taxes for upper-income earners. That is the current rule which dictates that you don't have to pay payroll tax on any dollar you make over $90,000. That means that for every dollar you make over $90,000 per year your effective rate of payroll taxation goes down.

If that changes, half of that change will be on the employer side. So maybe this is angle: these companies want to phase out Social Security so there's no chance they'll have to pay payroll tax on a larger percentage of the salaries of their upper-income employees.

Of course, the more forward-thinking pro-phase-out companies can probably see that down the road privatization will likely get them out of a lot of existing payroll taxes too.

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