Josh Marshall

Josh Marshall is editor and publisher of TalkingPointsMemo.com.

Articles by Josh

Finally, finally, finally, FINALLY!

Finally, a major publication -- on its newspages -- has taken up one of the key dishonesties (I was going to say the biggest, but there are so many ...) in President Bush's argument for phasing out Social Security.

As we've discussed here many times, President Bush's gloomy predictions about the demise of Social Security are premised on a 21st century of anemic economic growth while his claims for private accounts are based on a 21st century of robust economic growth.

As Jonathan Weisman and Ben White put it today on E1 in the Post: "To conclude that Social Security is careening toward a crisis in 2042, President Bush is relying on projections that an aging society will drag down economic growth. Yet his proposal to establish personal accounts is counting on strong investment gains in financial markets that would be coping with the same demographic head wind."

Rep. Slaughter (D) of New York calls on the president to explain why a phony 'reporter' from 'Talon News' got accredited at the White House for the apparent purpose of teeing up softball questions for McClellan and the president.

Meanwhile, an eagle-eyed poster at Dailykos asks why this fellow also seems to have been leaked a CIA memo about Valerie Plame.

She references this passage from a December 26th, 23 piece in the Washington Post: "On Oct. 28, Talon News, a news company tied to a group called GOP USA,posted on the Internet an interview with Wilson in which the Talon News questioner asks: 'An internal government memo prepared by U.S. intelligence personnel details a meeting in early 2002 where your wife, a member of the agency for clandestine service working on Iraqi weapons issues, suggested that you could be sent to investigate the reports. Do you dispute that?'"

Conscience Caucus member Rep. McCrery (R) of Louisiana chooses shoulder socket over Social Security!

From CQ Today ...

The White House's lobbying effort on behalf of its Social Security overhaul has already yielded results: A key House subcommittee chairman said Wednesday he has been persuaded to push for Bush's plan.

Jim McCrery, R-La., the chairman of the House Ways and Means Subcommittee on Social Security, said the director of the White House National Economic Council, Allan B. Hubbard, sold him on the president's approach in a private meeting on Tuesday.


"I'm convinced the president's approach is worth pursuing in the legislative process," McCrery said. "Frankly, I had not thought of the policy rationale they described yesterday."

It's awfully encouraging that the Chairman of the Social Security Subcommittee hadn't realized what the rationale was for the president's <$NoAd$> policy.

Chairman Thomas, you gotta be next, buddy ...

Reuters discusses AARP's plan to strengthen Social Security by raising the payroll tax cap to $140,000, which they say would reduce the long-term shortfall by 43%. They also support having the SSA invest part of the Trust Fund in what I take to be an index fund, which they say would handle another 15%.

This is the plan Conscience Caucus member Rep. Ginny Brown-Waite (R) of Florida is excited about.

(ed.note: As we discussed on Saturday, while phase-out supporters will seek to confuse the issue, having the Trust Fund invest some money in private securities is entirely different from phase-out with private accounts. Whether it's a good idea or not is a complicated question, but it is entirely different from private accounts. For more, see the post.)

We get letters like this about Senator Chafee (R) of Rhode Island almost every day ...


I have been trying to get a straight answer out of Lincoln Chafee's office for months on where he stands on Social Security. I have gotten nothing from them. I have written two letters. No response. I called his office and was promised a callback, but heard nothing from them. As far as I am concerned, Chafee refuses to give an answer on where he stands on Social Security. I have corresponded with Senator Chafee many times in the past. I have always received a quick and relatively straightforward response, so I can only assume that his refusal to answer is intentional.

Would I vote for Senator Chafee's re-election? No. I would not vote for anyone who will not unequivocally stand up for Social Security. Combine that with his vote to confirm Alberto Gonzales, which to my mind is a vote in favor of torture, and I simply cannot support him. I will be strongly supporting Matt Brown's (likely) run for Senate.

We also get letters like this one ...

Dear Josh-

Thank you for everything you are doing to shatter and dispel the falsehoods coming out of the administration about Social Security. I'm a 53 year old who began working at age 16. My mom, widowed at age 36 with 3 young kids, brought us up to believe that in America, you could strive toward your dreams and carve out your own future. She returned to work, of course, but could not have kept our family together without the benefits she received from Social Security and my Dad's veteran's benefits - he was a U.S. Marine who fought on the beaches of Iwo Jima.

I chose a path that allowed me independence in my life. I've been an independent contractor in my profession throughout my career, as has my husband. We pay our own health insurance premiums (currently $967 / month Oxford Health Plans, dig that!) make yearly contributions to our own IRA's, own our house, pay our taxes, and willingly pay our SSA contributions.

Mr. Bush wants to denigrate the service and the sacrifices of my father and my mother by saying their children don't deserve to have the social contract America made with us honored. I know deeply and personally how life can change in an instant, and if anyone wants to talk to me about it, I'll be glad to give them my two cents.

We are facing a galvanizing moment in America as we decide if we are to be a country that understands and lives the humanistic concept of being one's brother's keeper, or if we decide instead to adopt a ruthless, me first, sink or swim approach to dealing with our citizenry.

I pray with all my heart we choose the former.

Me <$NoAd$> too.

TPM reader TS writes in with a great idea. With President Bush bringing the Bamboozlepalooza Tour to Philly tomorrow, it seems like a great opportunity for Gov. Rendell to take himself out of the Fainthearted Faction. Yes, Dems who aren't even in Congress can get special Associate Membership in the Faction for particularly gratuitous examples of Faintheartedness. And Gov. Rendell is one of two who has it.

One of the most misleading comparisons President Bush made in his State of the Union address came when he compared private accounts carved out of Social Security to the Thrift Savings Plan available to employees of the federal government.

Now George Will has picked up the cudgel, combining this bogus comparison with the now de rigueur demonization of Sen. Harry Reid, who scares Republicans.

In his final flourish Will writes ...

Begun in 1987, the Thrift Savings Plan, which as of December 2004 had assets of $152 billion, is a retirement-savings plan open to all civilian federal employees, including senators, and all members of the uniformed services.

They can invest as much as 14 percent of their salaries in one of five retirement funds. Consider the rate of return of C Fund, one of the five. It is a common-stock fund, so it should represent the risks that Reid thinks should terrify Americans:

In only four of 17 years has the rate of return been negative. But in 11 years the rate has been greater than 10 percent, in eight years it has been greater than 20 percent, in four years it has been greater than 30 percent. The compound annual rate of return for the last 10 years has been 12 percent, and the return over the 17 years has been 12.1 percent.

Reid participates in the plan, but opposes allowing all Americans the comparable opportunity that Bush is proposing. But if the numbers just cited are the result of roulette, the legislators should let the rest of us into the game in which they are prospering.

Who will make the obvious point?

No federal employees put their Social Security funds into the TSP. The TSP is in addition to Social Security. To the extent that there is an analogy to anything it is to an add-on account -- the kind Democrats support and <$Ad$> Republicans oppose. Indeed, the TSP is little different from private sector 401ks, a defined-contribution retirement plan.

Indeed, no less an authority than the Social Security Administration says: "The TSP is a defined contribution plan similar to the 401K plans offered in the private sector. Contributions are made by payroll deduction. Both the money that is contributed and the interest earned are tax-deferred."

Let's give Will the benefit of the doubt and assume he's just ignorant rather than intentionally misleading. Democrats don't think people shouldn't invest in private securities as part of their retirement planning. What they say is that that should be in addition to Social Security, from which workers get a flat guarantee of a base level of retirement income.

The question isn't why everyone shouldn't have the chance to get in on the Thrift Savings Plan. The question is why everyday Americans should have to choose between Social Security and the TSP when federal employees now get to have both.

The point is simple and no more complicated than the elementary concept of diversification in an investment portfolio. Ideally, retirement planning should include multiple sources of income: the guaranteed, threshold level of income provided by Social Security, private savings and an employer-based pension. Each has different levels of risk involved. One key importance of Social Security in this mix is that it is the one part of the equation in which there is a flat, no-matter-what guarantee.

And as long as we're on to this issue of the guarantee behind Social Security, consider this.

In a fact-sheet distributed by the White House last week, the president's budgeteers argued that by diverting 1/3 of his or her payroll taxes into a private account, a worker would forgo 1/3 of their guaranteed benefit from Social Security.

But in a policy memo making the rounds in Washington, Jason Furman argues that this is incorrect. For workers who live their whole careers in the president's private account system -- which would start with kids born in 1990 -- diverting 1/3 of their payroll taxes would result in forgoing 2/3 of their guaranteed benefit.

As Furman writes: "Under the President’s plan the worker would have to give up about two-thirds of future government benefits and be entitled to receive about $5,000 annually from the traditional system – that is only enough to replace 8 percent of one’s pre-retirement income."

We've just added the Furman memo to the TPM Document Collection. So you can read it yourself.

AP: "When Rep. Rob Simmons walked into the White House Tuesday, he was ready to defend his opposition to the president's proposed overhaul of the country's Social Security system. So in the meeting, Simmons, R-Conn., handed President Bush a copy of an opinion piece he wrote, opposing any effort to divert Social Security dollars into personal accounts _ a provision Bush has advocated."

Rep. Simmons of Connecticut just keeps getting Louder and Prouder.

On the other hand, Rep. Chris Shays seems to be a big supporter of replacing Social Security with 401ks-like private accounts.