Hendrik Hertzberg: George Bush, Ingrate (Re: Social Security)

As an institution, the trust fund has been good to the Bush clan. Thanks to this ingenious financial tool, through which part of a family fortune can be protected for its intended beneficiaries, George W., among other Bushes, has been spared some of the material difficulties that afflict so many of their fellow-citizens. It is the trust fund that, in part, has allowed members of the family to follow their dreams.

Another sort of trust fund, the one associated with Social Security, has likewise been good to America’s ruling dynasty. True, the direct disbursements are relatively trifling: although the checks go out to Poppy and Bar, as they do to thirty million other retirees, the amounts are probably insufficient to pay lawnmowing and pool expenses at Kennebunkport. But the political benefits, especially to their firstborn son, have been formidable. The Social Security system consists of, on the one hand, a disbursement mechanism that provides modest but dependable incomes to the elderly and the disabled and their survivors and dependents, and, on the other hand, a funding mechanism, a 12.4-per-cent flat tax on wages up to ninety thousand dollars a year. The difference between the two goes into (or comes out of) the Social Security trust fund, which has grown dramatically over the past twenty years. In tandem with the Clinton Administration’s fiscally responsible budgeting, the trust fund’s growth pulled the entire federal budget out of deficit from 1998 to 2001. Those trust-fund-driven budget surpluses, in turn, enabled George W. Bush, first as a candidate and then as President, to sell (falsely, it turned out) his program of tax cuts for the comfortable as a freebie. And the trust-fund surplus kept this year’s budget deficit down to a scary $412.1 billion, rather than the scarier $563.2 billion it would be without it. You would think, therefore, that the President would speak respectfully of the Social Security trust fund. But no.