Bush regime is very worried about economic iceberg...

[kentuck]

He had a scheme to pass private accounts but people did not buy it - not even Republicans. They see an iceberg straight ahead and they cannot turn the ship. They have given away too much. There is not enough revenue coming in to keep our heads above water and to maintain credibility in the world markets. It's a helluva bind. What do they do? Admit they made a mistake by cutting revenues too much? No, not hardly. They would prefer to try a flat tax or a sales tax but neither will bring in enough revenues for their gluttonous appetites. This is the icing on the "fucked-up cake". There is no way out except to blame it on the Democrats.

[caledesi]

1. Great post. Did you come up w/ the "economic iceberg?"

Kentuck - alway like your posts. As usual, you nailed it.

[colonel odis]

2. as you said, they'll blame it on the democrats. because their pathology

doesn't allow them to blame themselves or admit a mistake for anything. anything.

[liberal N proud]

3. You have that right - we are headed for a Titanic sized economic

catastrophe

[The White Tree]

4. I think there is some truth to what you say.

I was reading an article in the NTTimes this morning about the Republicans "New" proposals for Social Security and private accounts. These proposals seek to take the Socials Security surplus and use it to create private accounts until the surplus runs out.

Heres a link:

<http://www.nytimes.com/2005/06/24/politics/24social.html>

The passage I found most interesting:

For now, the attention is on the new Republican plans, and how they would work. Although some details in the House and Senate bills may be different, both would use surplus Social Security taxes over the next decade to pay for individual investment accounts.

Next year, the amount available for investment in private accounts would be the $70 billion more paid in Social Security taxes than what will be paid out in benefits. That surplus will rise somewhat for a few years and then drop. After 2016, according to government actuaries, benefits will exceed taxes, and under the legislation no more money would be put into private accounts; further investment in those accounts would then be up to future Congresses.

In an evaluation of the Senate bill, Stephen C. Goss, the chief Social Security actuary, calculated that average earners who are 26 years old this year, retire at 67 in 2046 and invest in a mixed portfolio of stock index funds, bond index funds and government securities from 2006 through 2016 could expect to have about $23,000 in their investment accounts when they retired.

Mr. Goss also found that the proposal would increase the budget deficit by about $90 billion next year and about $860 billion over 10 years. That, of course, could be a major political problem, given that Mr. Bush has pledged to cut the deficit in half in five years.

I always felt that this is what is behind the rhetoric on private accounts. When a vast majority of our citizenry has a large portion of it's assets tied up directly in Wall Street, it will presumably make pro-business legislative decisions (on things like the minimum wage and health insurance, environmental regulation) much easier to pass because more people will have a stake in the prosperity of business at all cost because they will be so tied in to the bottom line.

[shraby]

6. Why don't they just put 90 billion into SS if

it's going to increase the deficit anyway. That just might keep it solvent.

[leveymg]

5. Iceberg ahead? What was that hard bump we felt last night?

Why is the ship slowing, and it feels like it's listing far to starboard? Why are all those gentlemen in First-Class getting into the lifeboats?

Quick, rearrange the deck chairs and have the band play, "The Flag Burning Amendment" song again.

Odd. They said this ship is unsinkable.

[elehhhhna]

7. Enron Redux, thanks to the MBA President.

[sendero]

8. MBA..

... as in Major Bullshit Artist :)

I think the OP has pretty much nailed it. They realize that their supply side nonsense is simply not working, and there has to be something to prop up the markets since there is basically nothing (short of complete realignment of the tax cuts) they can do to actually fix the economy.

[elehhhhna]

9. Got the MBA from MSU

(Make Shit Up)