Abused By Illusions

Greenspan wrote plan in 1983 that was to save Social Security

Dec. 15, 2004 - "President Bush is trying to sell his privatization proposal as a plan to save Social Security, when it is actually a clever scam designed to destroy the program that conservatives have hated since its enactment in 1935," says economist Allen W. Smith, Ph.D., author of the book, "The Looting of Social Security: How the Government is Draining America's Retirement Account."

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Smith argues that Social Security is not facing an imminent crisis and that Bush is using scare tactics in an effort to stampede the public into accepting his plan.

According to Smith, the Bush plan is a Trojan horse with which Bush, Greenspan, and fellow conservatives hope to destroy the current Social Security program before the American people wake up to the fact that $1.5 trillion of Social Security money has been spent on other things by the government, in violation of federal law, over the past two decades, with more than one-third of the money having been looted during Bush's presidency.

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Smith says that Alan Greenspan was the chief architect of a plan to fix Social Security that was enacted into law in 1983. That legislation increased payroll tax rates high enough so the baby boomers would be required to prepay the cost of retirement benefits for themselves, in addition to paying for the benefits of the preceding generation.

The 1983 payroll tax increase has generated more than $1.5 trillion in Social Security surplus, earmarked specifically for funding the retirement of the baby boomers. Because of that tax increase, the trust fund should today contain at least $1.5 trillion in real liquid assets in the form of regular marketable Treasury Bonds just like those bonds in which many private pension plans invest, but it does not contain any marketable bonds.



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