Brendan Nyhan

Time to start worrying about risk

The American Prospect's Matthew Yglesias does a good job of covering some material I was planning to write up. Economic risk has become a hugely important policy issue:

RISK AND REWARD. Kevin Drum alerts us to the fact that Peter Gosselin's superb series on economic risk in America is now available in a convenient package. Give it a read, even if you've read it before. It pairs nicely with Brad DeLong's excerpts from today's Wall Street Journal article, "In Bush's 'Ownership Society,' Citizens Would Take More Risk."

Putting the two together, the picture you get is this: Over the past 30 years, the American economy has become riskier for its participants. I think this is mostly a good thing, all things considered. The risk is largely a reflection of increased flexibility due to new technologies, a more competitive market dynamic, and an integrating global economy. It's allowed us to put together a much larger economic pie than we used to have. But the higher risk is a real cost. It's a cost that, fortunately, we can mitigate through public policy. A guarantee of a secure baseline for your retirement. A guarantee that no matter what happens, you'll get treated if you fall ill. One could go on. Implementing these policies in a climate of increasing risk could give us a more dynamic economy overall while cushioning many of the problems it's created.

The general direction of Bush's plans is the reverse. Take an economic climate that's getting riskier. Then implement a bunch of policies to make it even riskier. That's an okay deal if your family's got enough wealth and connections to bail you out after every failure in life, but for the average person it's a terrible idea and there's really no reason on earth to do it.

Let me add that Yale political scientist Jacob Hacker, a leading expert who is working on a book on the subject, has articles and data on his personal website that are also worth a look.

Playing on anti-Arab bigotry

Ann Coulter recently tried to include this sentence in her syndicated column: "Press passes can't be that hard to come by if the White House allows that old Arab Helen Thomas to sit within yards of the president." And Rep. Sam Johnson recently advocated nuking Syria (though his staff denies it): "Syria is the problem. Syria is where those weapons of mass destruction are, in my view. You know, I can fly an F-15, put two nukes on 'em and I’ll make one pass. We won't have to worry about Syria anymore." Both of these comments are obvious plays on anti-Arab bigotry (obviously no one likes the Syrian regime, but nuking the country would kill millions of innocent people). President Bush did a good job of denouncing anti-Arab bigotry immediately after 9/11. The question now is whether his administration will call out Coulter and Johnson on these comments.

What's the matter with Dean in Kansas?

Howard Dean, fresh from stereotyping minorities as hotel workers, has weighed in recently with two more bits of wisdom during a visit to Kansas.

As Mickey Kaus notes (by way of Polipundit), Dean ended a speech on Friday in Lawrence, Kansas with this statement: "This is a struggle of good and evil. And we're the good." Wonderful. Pretty soon he'll be calling George Bush "El Diablo".

The worst part about Dean's destructive rhetoric is that the rank and file take their cues about what's acceptable from people like him. The local report on the Lawrence speech quotes Katherine Dessert, a "student and preschool teacher," as demanding even more extremism. "I feel like he could have gone even stronger with his language... I feel like he was a little bit too conservative. It didn't move me." When preschool teachers want more red meat, you know we're in trouble.

During a different speech in Topeka, Dean also said "I don't believe the way to fix Social Security is to have Wall Street run it so that it can be invested in Enron and Tyco and MCI." However, as I've pointed out before, Bush's plan would not allow specific investments in individual securities. The index funds that investors could put their money represent a broad cross-section of corporations, and would not be appreciably impacted over the long term by individual corporate failures. There's a larger issue here, of course, about the risks associated with investment in stocks, which can be quite high if you retire at the wrong time, but rather than making that argument, Dean is just throwing out tarnished corporate names to try to generate a negative association with Bush's proposal. It's not a reasoned argument.

Thanks Democratic National Committee!

What is Matt Bai talking about?

Here's a classic example of a bogus logical opposition from Matt Bai in the New York Times Magazine:

So-called [Democratic] centrists, with precious few exceptions, have lined up with their party's base against the idea of partly privatizing Social Security, even though those same Democrats used to argue that the program was gravely ill.

How can one of the nation's top political writers put his name on a sentence like this? Why would there be any contradiction between expressing concern for the future of Social Security and opposing privatization? Private accounts would worsen the finances of Social Security and the federal government for decades. Even the Bush administration has admitted that they do nothing to resolve the system's financing shortfall and require trillions in borrowing over the next several decades. Where the hell has Bai been?

What is Eric Boehlert talking about?

Salon's Eric Boehlert is joining the left wing blogosphere in freaking out about the Jeff Gannon/James Guckert story:

On Feb. 17, "NBC Nightly News" anchor Brian Williams introduced a report on controversial White House correspondent James Guckert by informing viewers that the saga was "the talk of Washington." Nine days later the mysterious tale of an amateur, partisan journalist who slipped into the White House under false pretenses remains the buzz of the Beltway. Yet most mainstream reporters have opted not to cover the story. Two of the television networks, as well as scores of major metropolitan newspapers around the country, have completely ignored it.

Put me down with Bob Somerby on this one:

Of course, we can’t say why news orgs have behaved as they have. But why might the press have ignored this story? Could it be because it’s hopelessly trivial? In our view, the fascination with this story is another sign of the liberal web’s imperfect judgment—its tendency to confuse the wheat with the chaff, its inability to get a read on what sort of stories really matter.

Readers, why would a mainstream news org spend its time on this trivial story? Until last month, no one had ever heard of Jeff Gannon. At the time, he worked for Talon News—and no one had ever heard of them either! And except for one stupid question he posed to George Bush, Gannon-Guckert’s terrible sin was asking dumb questions of Scott McClennan, another person no one has heard of! Meanwhile, Gannon is hardly the only conservative kook asking dumb questions at McClellan’s daily sessions. For example, kooky talk host Les Kinsolving asks stupid questions in this forum every day—and no one has ever said Boo about that. It’s not clear why readers of any big paper would gives a rat’s *ss about Gannon’s behavior. Why did news orgs ignore this story? Perhaps because it simply ain’t news! Perhaps because no one in the fifty states gives a rat’s *ss about Gannon’s questions.

And Andrew Sullivan is right to point out that there has been far too much glee at the outing of Gannon/Guckert.

Can we move on to something important now? Thanks.

Go Togo

It received almost no media attention here in the US, but the cause of democracy won a major victory yesterday. Under pressure from other African countries, the ruler of Togo was forced to resign yesterday, aborting an unconstitutional takeover of power. And Hosni Mubarak is promising a multi-party presidential election in Egypt, though his regime has imprisoned an opposition leader and it's not clear whether this is a feint to placate critics abroad. Still, today I will join David Brooks in celebrating the cause of people around the world pushing for democracy, and be hopeful.

Realities collide on Social Security

Dueling press releases:

Democratic Senatorial Campaign Committee: "THE REVIEWS ARE IN: SANTORUM'S SOCIAL SECURITY ROADSHOW WAS A BUST!!! ... Pennsylvanians – Young and Old – Reject Santorum's Scheme to Privatize Social Security"

National Republican Senatorial Committee: "Rather Than Offer Ideas or Solutions, Democrats Offer Doom and Gloom Attack Politics... Sen. Rick Santorum's (R-PA) Social Security Town Hall Meetings Are A Success"

I'm not sure what the NRSC is talking about here. Both sides clip the most favorable quotes out of context from media reports on Santorum's meetings with constituents, but even Santorum himself was forced to admit to the New York Times that the meetings did not go well:

After a bruising weeklong recess, Congressional Republicans will return to work on Monday chastened by public skepticism over President Bush's plan for private accounts in Social Security. One leading Republican, Senator Rick Santorum of Pennsylvania, acknowledged that the opposition was better organized while another, Senator Charles E. Grassley of Iowa, said bipartisan compromise was unlikely unless the president can change the public mood.

"It's a heavy lift," Mr. Grassley, the chairman of the Senate Finance Committee, said Friday, after a week spent crisscrossing his home state to play host to 17 town-hall-style meetings. He said the sessions ended "without my getting much of a consensus of where people are, except general confusion," and with the president still facing "a major job of educating people."

The story was much the same throughout the country, as Republicans - some already skittish over Mr. Bush's plan - spent the week trying to assuage nervous constituents. Instead of building support for Mr. Bush's proposal to allow younger workers to divert payroll taxes into private retirement accounts, some of the events turned into fractious gripe sessions and others did not go nearly as well as their hosts had hoped.

...Mr. Santorum complained that he was dogged all week by opponents of the White House plan who dominated news coverage. Mr. Santorum, who is the third-ranking Republican in the Senate leadership and chairman of the subcommittee on Social Security, was heckled by college students - the very audience the Bush administration was counting on - and peppered with questions from retirees.

"Clearly the other side is better organized," Mr. Santorum said. "They got people to all these events. They had seniors lined up to ask questions, they had staff people running up passing them notes."

Even so, Mr. Santorum described himself as encouraged at the level of interest; both he and Mr. Grassley said it was far too early to predict the outcome...

AARP, the powerful retirees' organization that opposes private accounts financed by payroll taxes, has been tracking the meetings.../p>

"We've yet to find one where there was an enthusiastic reception," said John Rother, the group's policy director. "The most positive reception people are getting is lots of questions, and there's significant skepticism. This is proving to be a tough sell, and our polling suggests that the more people know, the harder the sell."

As I said a couple of weeks ago, Bush's plan is dead in the water and no one knows it yet. The White House has not been able to create a majority coalition in favor of private accounts, and the intensity of feeling at the grassroots is much stronger among opponents. The only question is when the administration will start moving toward a less risky compromise or pivot to another issue.

Update 2/27: The Washington Post reports that Republicans are already start to push for such a compromise, and offer this ominous warning:

Over four years, this president usually has chosen defiance rather than difference-splitting in dealing with opponents. He has dismissed making premature concessions by saying he does not like to "negotiate with myself."

But history suggests waiting too long can be equally self-defeating. In late 1993 and early 1994, there were ample signs that Clinton's comprehensive health care plan was in trouble, but there were also many senior Republicans who said they would work with him to pass incremental reforms. Some of these measures would have been substantial -- expanding health insurance for children or providing subsidies to help more individuals buy their own insurance.

Clinton, at the urging of then-first lady Hillary Rodham Clinton, refused to yield. In the 1994 State of the Union address, he waved a pen and warned Congress that he would veto any plan that did not meet his goal of universal coverage for every American. By summer, when it become obvious that his comprehensive plan was dead, Republicans were relishing Clinton's political troubles and none was still willing to compromise. That fall, Republicans swept to control in Congress, an advantage they keep to this day.

Fact-checking the Post's fact-check on Social Security

The Washington Post has published a useful fact-check of misleading claims about Social Security, including two I've flagged before: Bush's claim that Social Security going "bankrupt" and Democratic suggestions that Bush's private accounts plan is intended to enrich Wall Street. But Jim VandeHei and Jonathan Weisman mess up the numbers pretty badly in the middle of the story:

For virtually everyone, those future rates of return [under the traditional Social Security system] would fall below the 4.6 percent gains the government actuary anticipates for money that would be invested in personal accounts under Social Security. But under the administration proposal, anyone investing in the accounts would lose 3 percent of their gains to help finance the new system. So beating the current system is not a sure thing.

This is just wrong. People who create private accounts would not lose "3 percent of their gains" - they would have their benefits reduced by the amount of funds diverted into their private accounts plus 3 percent interest. Depending on the returns they receive on their investments, that could amount to as much as 100% of their gains or more. Weisman is an economics reporter who already had to correct a story explaining how Bush's "benefit offset" plan would work; shouldn't he be able to get this right by now? It's reminiscent of all the reporters who wrote that 4 percent of payroll taxes would be diverted into private accounts rather than 4 percent of eligible salary.

Update 2/27: I emailed Weisman and a number of editors yesterday in an attempt to notify them about this mistake so it could be corrected before Sunday's final print editions went out, but I've received no response and the online edition still contains the same error. I'm starting to get annoyed with the Post, which also ignored my request for a correction explaining the definition of "waterboarding" after they published two different definitions.

MP3 audio of Cox's CPAC speech

Courtesy of Robert Cox, the proprietor of TheNationalDebate.com and the driving force behind the Media Bloggers Association (of which I'm a member), here is MP3 audio of the relevant portion of Chris Cox's highly misleading speech at the Conservative Political Action Conference. (For those who are interested, Bob has an interesting and thoughtful post up about his experience blogging at CPAC.)

Reforming the presidential nomination process

In the Washington Post today, E.J. Dionne gently mocks the Democrats' Commission on Presidential Nomination Timing and Scheduling:

When the going gets tough, Democrats form commissions.

It's an old habit: If an election is lost, there must be some fix in the party's rules and procedures that will turn things around.

The commission is co-chaired by Rep. David Price (D-NC), who is my Congressman and a professor in Duke's department of political science (where I'm a graduate student). Dionne praises Price, but urges the commission to examine larger questions about Democratic "values, ideas and policies." This is silliness. A commission is not the way to address those questions; does anyone think that Price could actually change the party's values or policies by issuing a report? The changes that are needed will take time and happen in a necessarily decentralized and chaotic way; the process can't be managed from above.

More importantly, when Dionne belittles procedural reform, he's missing a crucial point. From a small-d democratic perspective, the front-loaded nomination process is a bad thing. It creates a bandwagon dynamic based on a few primaries in small states, preventing most party members from having a voice in the choosing of the nominee. And from a tactical perspective, the nominee that emerges is not battle-tested, which ends up hurting them in the end. In 2004, John Kerry essentially won the nomination over the course of a month as a result of positioning himself as the viable candidate who was not Howard Dean. He never had to establish a winning positive message, and he paid dearly for it in the general election. Of course, that's not the only reason he lost, but the way in which he was chosen so quickly did not help him or the Democrats.

Let's hope Price ignores Dionne and focuses on reforming a process that badly needs it.

The VA, "baby bonds" and national service

My friend Ben Fritz, who co-edited Spinsanity with me and Bryan Keefer, has a good post up on his blog about two creative ideas to promote national service. First, Philip Longman wrote a fascinating article in the Washington Monthly about innovation in medical care at the Veterans Administration. It's so good, Longman argues, that we should consider expanding VA eligibility to the parents or relatives of young people who complete a national service requirement. And a Boston Globe op-ed by two City Year executives endorses a New America Foundation proposal for a "National Service Baby Bond" -- a fund invested at birth for children by the government that would grow over their lifetime and could be redeemed after two years of national service. Ben is a passionate advocate of national service after spending a year in Americorps' National Civilian Community Corps (read his Salon article about it). It's time to start implementing these kinds of proposals, which will encourage more people to have that same kind of experience.

Cox responds on Salon WMD quote

I called Rep. Chris Cox's office this morning to ask if he had been accurately quoted in the Salon article I posted on over the weekend, which includes this passage:

Vice President Dick Cheney, a regular CPAC speaker, gave the keynote address. California Rep. Chris Cox had the honor of introducing him, and he took the opportunity to mock the Democrats whose hatred of America led them to get Iraq so horribly wrong.

"America's Operation Iraqi Freedom is still producing shock and awe, this time among the blame-America-first crowd," he crowed. Then he said, "We continue to discover biological and chemical weapons and facilities to make them inside Iraq." Apparently, most of the hundreds of people in attendance already knew about these remarkable, hitherto-unreported discoveries, because no one gasped at this startling revelation.

I just received this statement in response from Cox via James Freeman, his legislative and communications director:

Michelle Goldberg, writing in Salon, has committed the egregious but all-too-common journalistic sin of tendentiously editing quoted material. The sentence she quotes was not a vague, general statement. Rather, it was immediately followed by two sentences that clearly explained the biological agent referred to was ricin and the chemical agent was sarin -- and that these might be packaged in, among other things, perfume containers.

Here is the passage in context (note there is NO reference to WMDs, which is an assumption you made, understandably, based on the tendentious report that appeared in Salon):

"Despite all evidence to the contrary, the Left persists with the fiction that our efforts in Iraq are a distraction from the war on terrorism. No, this is the war on terrorism. We continue to discover biological and chemical weapons and facilities to make them inside Iraq, and even more about their intended use. A plan to disperse sarin and the lethal poison ricin in the United States and Europe was actively being pursued as late as March 2003. The facility in which the weapons were being made also housed a large inventory of perfume atomizers of various shapes and sizes to mimic the existing brands on the store shelves in the United States. It doesn't take a lot of imagination to understand the implications, but it does take imagination and determination to combat it, which is why it is so important we have an administration that gets it."

What I said came straight from news reports the preceding weekend. That is why, as Goldberg wrote, "most of the hundreds of people in attendance already knew about these remarkable, hitherto-unreported discoveries" and did not gasp when I said it. The following is excerpted from the article "Oil-for-Food a Failure From the Start?" which appeared on FoxNews.com on Sunday, February 13, 2005:

The Iraqi Survey Group also found that supposed "humanitarian" imports under Oil-for-Food gave Saddam the ability to restart his biological and chemical warfare programs at a moment's notice. [UN weapons inspector Richard] Spertzel said what scared him the most in Iraq was the discovery of secret labs to make deadly weapons like the nerve agent, sarin, and the biological poison, ricin, in spray form.

"If that were released in a closed [area], such as Madison Square Garden or, even some, some of your smaller closed malls, shopping malls, it would have a devastating effect ... killing hundreds or thousands," Spertzel said.

But Spertzel believes Saddam was cooking up an even more sinister plan - putting the poisons on department store shelves across the United States and Europe. He said that plan was "actively pursued" as late as March 2003. And that plan was at least, in part, funded by Saddam's corrupt Oil-for-Food activities.

"Some of the photographs that were obtained from this same laboratory had multiple different shapes of glass spray bottles, perfume spray bottles - presumably to mimic different brand names," Spertzel said. "Can you imagine somebody going into Macy's department store and spray a little bit of a perfume to see whether they like the scent, only instead of perfume they're getting a face full of sarin?

"That would kill within, within a few minutes. If this were to appear at a couple different locations, imagine the economic impact in the U.S. - people would be afraid to buy anything."

There is an enormous difference between what I said (and clearly did NOT say about WMD), on the one hand, and what you inferred, based on the skimpy Salon out-of-context quote, that I must have said about new discoveries of Iraq WMD. Sarin and ricin are ugly terrorist tools, but they are a separate issue -- and my remarks left no doubt which I was talking about. You may not agree with my political judgment -- that it's good we have an administration that "gets it" -- but I hope you will help me point out that I have been misquoted. I appreciate your saying that I am a very trustworthy person (that is the message that was passed on to me) and I have every intention of remaining so.

Thanks.

Sincerely,
Chris Cox

Just to clarify, I didn't say Cox was "trustworthy"; that's a message that was garbled in translation. What I actually did say to his press secretary was that I thought of Cox as being smart and well-informed, so I was surprised to read the quote and wanted to verify that it was accurate. Unfortunately, I'm disappointed to say that it may be time to reassess my view of him -- he's misconstruing the FoxNews.com article that he claims backs him up and exaggerating scraps of evidence from the Duelfer Report.

First, how can he claim that "there is NO reference to WMDs" in his statement? He specifically said "weapons and facilities." Second, the Fox article never describes the discovery of "biological and chemical weapons" in Iraq. In fact, it specifically says "CIA investigators recovered no stockpiles of weapons of mass destruction" (though it later implies weapons were found, saying the UN "could have done more to stop Saddam from acquiring deadly weapons"). In addition, Cox's claim about an alleged plan to "disperse sarin and the lethal poison ricin in the United States and Europe" is also wrong. He refers to "[t]he facility in which the weapons [ricin and sarin] were being made," but the article never says that such weapons were being produced there. Instead, FoxNews.com refers to Saddam's "ability to restart his biological and chemical warfare programs at a moment's notice" and "secret labs to make deadly weapons."

If Cox had consulted the Duelfer Report, the definitive compilation of the findings of the Iraqi Survey Group, it states (PDF) that "While a small number of old, abandoned chemical munitions have been discovered, ISG judges that Iraq unilaterally destroyed its undeclared chemical weapons stockpile in 1991. There are no credible indications that Baghdad resumed production of chemical munitions thereafter." And as the liberal group Media Matters points out, the report states that the alleged perfume-sprayer plan reportedly could not be carried out due to a lack of chemical weapons agents:

A former IIS [Iraqi Intelligence Service] officer claimed that the M16 directorate had a plan to produce and weaponize nitrogen mustard in rifle grenades, and a plan to bottle Sarin and sulfur mustard in perfume sprayers and medicine bottles which they would ship to the United States and Europe. The source claimed that they could not implement the plan because chemicals to produce the CW agents were unavailable.

A few chemical munitions have been found, but they all appear to all be leftover pre-1991 stocks:

Since May 2004, ISG has recovered dozens of additional chemical munitions, including artillery rounds, rockets and a binary Sarin artillery projectile (see Figure 5). In each case, the recovered munitions appear to have been part of the pre-1991 Gulf war stocks, but we can neither determine if the munitions were declared to the UN or if, as required by the UN SCR 687, Iraq attempted to destroy them.

Also, there was no evidence (PDF) found of an active biological weapons program:

ISG found no direct evidence that Iraq, after 1996, had plans for a new BW program or was conducting BW-specific work for military purposes. Indeed, from the mid-1990s, despite evidence of continuing interest in nuclear and chemical weapons, there appears to be a complete absence of discussion or even interest in BW at the Presidential level. Iraq would have faced great difficulty in re-establishing an effective BW agent production capability. Nevertheless, after 1996 Iraq still had a signifi cant dual-use capability—some declared—readily useful for BW if the Regime chose to use it to pursue a BW program.

...Depending on its scale, Iraq could have re-established an elementary BW program within a few weeks to a few months of a decision to do so, but ISG discovered no indications that the Regime was pursuing such a course.

...ISG judges that in 1991 and 1992, Iraq appears to have destroyed its undeclared stocks of BW weapons and probably destroyed remaining holdings of bulk BW agent. However ISG lacks evidence to document complete destruction. Iraq retained some BW-related seed stocks until their discovery after Operation Iraqi Freedom (OIF).

So once again -- what is Chris Cox talking about? This is the chairman of the House Homeland Security Committee we're talking about. Why do I know more about the Duelfer Report than he does?

Update 2/22: Congressman Cox just called me to follow up on his email. I guess he hadn't read this post yet. He was very gracious, and in fairness to him I do want to emphasize something that I neglected in my original post. The Salon article should have included the references he made to the sarin/ricin lab. Cox did not make a general statement about the discovery of WMDs -- it was a specific factual claim, and should have been reported as such. That said, however, I did say to him that I believed he was misrepresenting the FoxNews.com article and urged him to re-read it. I also tried to make clear why I believe that his remarks were substantively misleading given the findings of the Duelfer Report that Iraq did not have active biological or chemical weapons programs.

One final clarification: When Cox states in his email above that "there is NO reference to WMDs," he was apparently making a distinction between nuclear and biological weapons, which are weapons of mass destruction in the sense of being able to kill many thousands of people, and ricin and sarin, which are smaller-scale chemical weapons. He emphasized this distinction to me and said that he doesn't think of ricin and sarin as WMDs. I pointed out to him that they are usually classified as chemical weapons, but we agreed that the term "weapons of mass destruction" is vague and it's better to speak precisely about different types of weapons.

[Disclosure: Spinsanity was a featured column on Salon for most of 2002.]

Cox discovers Iraqi WMDs

It's been clear for months that Iraq did not possess weapons of mass destruction and had a very limited WMD program before the war. Yet in late October 27% of Americans falsely believed that Iraq had WMD before the war and an additional 22% believed it had a major WMD program (PIPA poll [PDF] - see page 8). The message is not getting through because the White House and other conservative elites are encouraging these misperceptions. The latest offender is Rep. Chris Cox (R-CA), who Salon just caught making stuff up (via Atrios and Kevin Drum):

"America's Operation Iraqi Freedom is still producing shock and awe, this time among the blame-America-first crowd," he crowed. Then he said, "We continue to discover biological and chemical weapons and facilities to make them inside Iraq."

Where's the proof, Congressman? Let's get Charles Duelfer on the phone ASAP!

In all seriousness, if the media doesn't follow up on this, there is no hope. None. We need to make sure Salon quoted him accurately, but if they did, there should be hell to pay.

Blog scalps: Overhyped

Dan Drezner and Kevin Drum are mulling a question that I had a couple days ago -- are blogs really bringing down high-profile targets like Trent Lott, Howell Raines and Eason Jordan, or is it something else?

The answer, I think, is that the role of the blogosphere is being dramatically overhyped. Here's why. Within any institution, there are a number of possible coalitions that could be organized against its leader(s) depending on what issues are relevant. The problem their opponents face is that, even if the leaders are unpopular, there is no easy way to coordinate on an angle of attack when the system is in equilibrium. But when a leader trips up and a blog-fueled media frenzy ensues, it shocks the system out of equilibrium and provides what Thomas Schelling, one of the giants of game theory, called a "focal point" that opponents can coordinate around to construct a new majority coalition. So when a leader goes down, the underlying cause is the coalition of forces pushing them out, which in most cases is only partly driven by whatever provoked the blogs in the first place.

The evidence suggests that this has been the case for almost all of the prominent "blog scalps," which capitalized on pre-existing discontent or vulnerability to push someone out of an institution where they were forced to answer to a constituency. Think of Howell Raines at the New York Times or Jordan at CNN. A similar process is going on right now at Harvard (though blogs have played a relatively minor role there) -- deeply rooted faculty opposition to Larry Summers' leadership has coalesced in an attack on his comments about female underrepresentation in math and science. If he goes down, will his comments have been the cause? Only in a very shallow sense. Or consider the flip side of this phenomenon. Many other public figures who've been targeted by blogs (Michael Moore, Ann Coulter, Maureen Dowd, Brit Hume, etc.) have ridden out the storm because they either don't answer to a constituency or have institutionally secure positions.

It's time to stop getting so carried away with the influence of blogs -- helping make it possible to take out a few public figures with a weak grasp on power is consequential, but not exactly earth-shattering. And the jury is still out on whether the political blogosphere is playing a positive role in the national debate. As we wrote in All the President's Spin, blogs can be an important voice for good by fact-checking the media and politicians, but the reality is that the trend is increasingly going in the other direction -- we're seeing growing factionalization and an incentive structure that rewards bad polemics, precisely what Cass Sunstein warned about in his book Republic.com. I hope he's not proven right.

Update 2/19: My former Spinsanity co-editor Bryan Keefer has a good post along similar lines about partisan hysteria and the thirst for scalps in the blogosphere.

David Horowitz's "Discover The Network"

David Horowitz, that shoddy right-wing provocateur, has debuted his latest project, DiscoverTheNetwork.org, which is tagged as "A guide to the political left." I learned about it from an ad in The Chronicle, Duke's student newspaper, which simply included the URL and promised to reveal who really controls the Democratic Party.

The site claims that it "identifies the individuals and organizations that make up the left and also the institutions that fund and sustain it; it maps the paths through which the left exerts its influence on the larger body politic; it defines the left's (often hidden) programmatic agendas and it provides an understanding of its history and ideas." But if you click on "individuals", it includes terrorists (Mohammed Atta, Abu Musab al-Zarqawi, Khalid Shaikh Mohammed, Sheik Omar Abdel Rahman and Zacarias Moussaoui), anti-American dictators (Ayatollah Khomeini, Yasser Arafat, Fidel Castro) and other hated and disreputable figures (Lynne Stewart, John Walker Lindh) alongside John Kerry, Barack Obama, Howard Dean and many other mainstream Democrats.

Let's be clear. There is no possible justification for lumping these disparate figures together other than pure guilt-by-association. The best Horowitz can do is to claim that the section of the site "examines activists for leftwing agendas and causes, radical egalitarians, and opponents of American 'imperialism.'" This is the crudest sort of pseudo-logic -- Kerry, Dean and Obama do not share an agenda or association with Al Qaeda, Castro, Arafat or Khomeini.

The rest of the site appears to consist of recycled articles from Horowitz's FrontPageMagazine.com and a mapping tool that draws vague links between various left-wing individuals and foundations.

Horowitz is a blight on the political debate. Like Michael Moore and Ann Coulter, he should be shunned.

Payola far and wide

The Armstrong Williams fiasco has drawn important attention to inappropriate government payments to journalists. But Bruce Bartlett notes that very little has been said about reporters, anchors and commentators who routinely accept massive corporate speaking fees:

[M]ainstream journalists who routinely speak before corporations, trade associations and interest groups hoping to influence news coverage practice the greatest double standard. Virtually every major television anchor is listed with one or more speakers' bureaus, which charge tens of thousands of dollars per appearance. But of course, this also gives business executives plenty of opportunity to explain why their industry or their products are really good for the American people.

In other cases, journalists work for the very businesses they report on. Howard Kurtz, The Washington Post's media reporter, has a show on CNN. Critics like Slate's Mickey Kaus have charged that this consistently causes Mr. Kurtz to underplay negative news relating to CNN.

Yet journalists are still quick to assume every politician who takes a $1,000 campaign contribution from a lobbyist has been bought, while self-righteously proclaiming that $100,000 speaking fees cannot buy them. At least the officials have to disclose it, while no one knows how much the journalists make or whom they have been bought by " sorry, I mean by whom they were paid to speak. If what the journalists are doing is justifiable, why don't they give government officials the same consideration? The answer is pure hypocrisy, nothing more.

This is not meant as a defense of conservative columnists who got government contracts. They should have enough sense to know there is a double standard and avoid the appearance of impropriety. But mainstream journalists, in effect selling themselves to the biggest corporate bidder, are a much greater scandal that will be ignored because so many are on the take.

Unlike Williams, these journalists generally don't promise to promote a point of view in return for money, but that doesn't mean they should escape scrutiny.

Krugman on Greenspan and Social Security rhetoric

Paul Krugman makes two important points today. First, the evidence that Alan Greenspan is a partisan is just undeniable. After pressuring the Clinton administration to focus on debt reduction, he endorsed Bush's tax cuts and then backed private accounts in Social Security this week even though the President has presided over a massive deterioration in the nation's finances. This is a betrayal of the public trust -- Greenspan wields vast power as an unelected official, and he should not use his position to promote his personal political objectives.

Second, Krugman has a good description of a Bush administration rhetorical maneuver that's key to how they're promoting private accounts:

The way privatizers link the long-run financing of Social Security with the case for private accounts parallels the three-card-monte technique the Bush administration used to link terrorism to the Iraq war. Speeches about Iraq invariably included references to 9/11, leading much of the public to believe that invading Iraq somehow meant taking the war to the terrorists. When pressed, war supporters would admit they lacked evidence of any significant links between Iraq and Al Qaeda, let alone any Iraqi role in 9/11 - yet in their next sentence it would be 9/11 and Saddam, together again.

Similarly, calls for privatization invariably begin with ominous warnings about Social Security's financial future. When pressed, administration officials admit that private accounts would do nothing to improve that financial future. Yet in the next sentence, they once again link privatization to the problem posed by an aging population.

Here's an example of how this works from Dick Cheney's speech to the Conservative Political Action Conference yesterday. He first introduced private accounts as a way to help younger workers. "[A]s we fix Social Security, we must make the system a better deal for younger workers," Cheney said, "and the best way to reach that goal is through voluntary personal retirement accounts." But by the time he concluded his discussion of private accounts, the Vice President was implying that they help resolve the Social Security system's funding shortfall, saying, "Personal accounts are part of a comprehensive solution to help the nation resolve the long-term challenges to Social Security in a way that is fair to future generations."

Bush phaseout hints?

Is President Bush suggesting that he wants to phase out traditional Social Security entirely? From the New York Times today:

In the interview on Tuesday, Mr. Bush suggested that he foresees the plan to divert 4 percent of earnings into private accounts as a first step toward a longer range transformation of Social Security.

"The relevant question there is how best to afford the transition from one system to another," he told reporters from The Orange County Register, The New Haven Register, The Birmingham News, The Tennessean of Nashville and The South Florida Sun-Sentinel. "It's a feasible place to start to enable us to introduce a novel concept into a Social Security system that needs to be reformed."

Bush can't move the numbers

It's worth reviewing where we are in the Social Security debate. President Bush has proposed a big initiative at great political risk to himself, confident that he can sway public opinion in his favor as he did with Iraq. But he's about to find out that domestic politics plays by a different set of rules.

Two political science books are instructive here. Politicians Don't Pander, a book by Lawrence Jacobs and Robert Shapiro, criticizes the way that politicians pursue their own preferences rather than responding to public opinion, creating a cycle of partisan conflict and alienation. Jacobs and Shapiro analyze Clinton's health care defeat in 1993-1994 and the attempt by the Gingrich Congress to reshape the federal government in 1995-1996. In both cases, the proponents of change were full of ideological conviction that they could shape public opinion, but when their opponents emphasized how risky and uncertain the outcomes could be, the public turned decisively against them. Similarly, in On Deaf Ears, George C. Edwards III, finds that the hype about the "bully pulpit" is wrong -- most presidents are not able to move public opinion in their favor.

We're starting to see these dynamics play out with Bush's Social Security proposal. As Josh Marshall notes, here's the latest Wall Street Journal/NBC News poll:

The survey of 1,008 adults, conducted Feb. 10-14, found that 51% Americans consider it "a bad idea" to change Social Security by allowing workers to invest payroll taxes in the stock market, while 40% think it's a "good idea." That is essentially unchanged since January, despite Mr. Bush's attempt to drum up support for the idea in the State of the Union address and a cross-country tour. The margin of error is 3.1 percentage points.

In a further sign of trouble for Mr. Bush, 60% of those who consider private Social Security investments a bad idea describe their position as "completely firm." By contrast, just 31% of proponents describe themselves that way; 68% say they could yet change their minds.

Members of Congress aren't going to risk their seats with numbers like this -- Bush isn't converting people into private accounts supporters. In fact, as Marshall points out, a question in the full poll (PDF) shows an even worse trend for the president:

Please tell me which of the following approaches to dealing with Social Security you would prefer––(A) making some adjustments but leaving the Social Security system basically as is and running the risk that the system will fall short of money as more people retire and become eligible for benefits, OR (B) changing the Social Security system by allowing people to invest some of their Social Security taxes in private accounts--like IRA's or 401k's--and running the risk that some people will lose money in their private accounts due to drops in the stock market?

The monthly trend between December 2004 and February 2005 for keeping the system intact is 39->44->50. Meanwhile, support for private accounts goes from 45->46->40. (Note: The margin of error is +/- 3.1%.)

In short, President Bush is dead in the water right now. Most people don't realize it yet, as Marshall points out. But it'll start to sink in soon enough.

Slime x3

With Spinsanity shut down, I try to avoid reading as much political vitriol, but here's a list of three people who need to be called out.

First, New York state Republican chairman Stephen Minarik said after Howard Dean's election as DNC chair that "now [Democrats] can be accurately called the party of Barbara Boxer, Lynne Stewart and Howard Dean." Stewart is a lawyer who was convicted of aiding her client, the radical Egyptian cleric Omar Abdel Rahman, pass messages to his followers from prison. The attempt to suggest that Democrats aid terrorists -- a popular post-9/11 tactic -- was so reprehensible that even New York's Republican governor, George Pataki, denounced it.

On the well-known Powerline blog, "Hindrocket," aka John H. Hindraker, directly accused former President Jimmy Carter, a naval veteran, of treason, writing (in the context of the war in Iraq) "Jimmy Carter isn't just misguided or ill-informed. He's on the other side." His only evidence is a Washington Times article in which the Carter Center didn't offer an opinion on the legitimacy of the Iraqi elections. The article also quotes Carter as saying in September that he didn't think the elections would happen. That's it.

And finally, former CIA analyst Michael Scheuer, who wrote two books under the pseudonym "Anonymous," is quoted in the Weekly Standard defending his accusation that Israel controls US foreign policy through clandestine activities:

Well, the clandestine aspect is that, clearly, the ability to influence the Congress--that's a clandestine activity, a covert activity. You know to some extent, the idea that the Holocaust Museum here in our country is another great ability to somehow make people feel guilty about being the people who did the most to try to end the Holocaust. I find--I just find the whole debate in the United States unbearably restricted with the inability to factually discuss what goes on between our two countries.

The Holocaust Museum is part of Israel's clandestine activities to influence the United States? It's here "to somehow make people feel guilty?" These is unsavory rhetoric, to say the least. Scheuer may not have meant it the way it came out, but he'll get no sympathy here.

Dean cronyism at DFA

It's amusing that Howard Dean, who furiously denounced the cronyism of the Bush administration, has installed his brother as placeholder chair of Democracy for America now that he's DNC chair. Jim Dean has no obvious qualifications other than being Howard's brother. Jim's only function is to ensure that Howard retains control of the organization while he is running the party (even though he's supposed to stay out of such matters while he's chair).

Obviously this isn't the same as no-bid contracts and the like, but it shows Dean is hedging his bets. And who wouldn't? He could be out of there in six months. Dean's already made this ill-advised and stereotypical comment to a meeting of the Democratic black caucus -- "You think the Republican National Committee could get this many people of color in a single room? Only if they had the hotel staff in here." And there are all the highlights of the oppo files that will be rehashed in the months to come, plus Karl Rove is bragging about tape he has of a second Dean scream.

Just to review public opinion on Dean, who I thought was a terrible choice for DNC chair, the latest polling numbers are from CNN/USA Today/Gallup (2/4-2/6): 31% favorable, 38% unfavorable. The same poll found that the supposedly polarizing Dick Cheney was viewed favorably by 51% of Americans, and unfavorably by 41%. So don't unpack, Howard. Your tenure could be short.

Yoo on mandates

The Jane Meyer New Yorker article on the rendition of suspected terrorists mentioned below has another noteworthy passage in which former Bush Justice Department official John C. Yoo defends his legal advice to the President justifying the use of torture:

Yoo also argued that the Constitution granted the President plenary powers to override the U.N. Convention Against Torture when he is acting in the nation’s defense—a position that has drawn dissent from many scholars. As Yoo saw it, Congress doesn't have the power to "tie the President’s hands in regard to torture as an interrogation technique." He continued, "It's the core of the Commander-in-Chief function. They can't prevent the President from ordering torture." If the President were to abuse his powers as Commander-in-Chief, Yoo said, the constitutional remedy was impeachment. He went on to suggest that President Bush's victory in the 2004 election, along with the relatively mild challenge to Gonzales mounted by the Democrats in Congress, was "proof that the debate is over." He said, "The issue is dying out. The public has had its referendum."

Regardless of your opinion of the administration's interrogation practices or their legal justification, this is a clear attempt to suggest that Bush's re-election somehow takes the issue off the table, which is anti-democratic nonsense. First of all, Bush's narrow victory was hardly a mandate, as I've shown at great length. Also, US interrogation policy was not exactly a central issue in the presidential campaign, let alone the subject of "a referendum." And even if it had been a key issue and Bush had won in a landslide, that wouldn't immunize the White House from questioning for the next four years.

(Note: All the President's Spin has a relevant chapter on the administration's attempts to suppress dissent in the wake of Sept. 11.)

The public vs. the spinners on Social Security

Is the public catching up to Social Security spin?

In a Washington Post poll last week, the brouhaha about "private" versus "personal" accounts seemed not to matter:

Americans seem not to change their views when the president's plan is characterized as a "private" rather than a "personal" investment account -- a change from earlier studies, in which the use of "private accounts" or "privatization" drove down support. Either way, a modest majority favored the proposal, the survey found.

But another semantic distinction - between cuts and reductions in guaranteed benefits - proved important:

Far more sensitive was the characterization of the way a restructuring would include a provision to recalculate initial benefits for retirees. Opposition rose from 68 percent when this change was characterized as "reducing the rate of growth in benefits" to 86 percent when described as "cutting guaranteed benefits." Both phrases accurately describe what would happen.

And the public did pretty well on factual questions, with large majorities knowing that private accounts wouldn't solve Social Security's problems and that they would only apply to future retirees. Only 37% knew about the large transition costs that would have to be paid, but given that the debate is still in its early stages, the poll as a whole has to be taken as an encouraging sign.

What is waterboarding? (part II)

About a month ago, I pointed out that the Washington Post and other publications have published contradicting definitions of the interrogation tactic known as "waterboarding," which is either strapping someone to a board and submerging them under water until they think they are about to drown, or placing a wet towel over their face and dripping water into their nose until they think they are about to drown. While both tactics are brutal, the first seems especially horrific, at least to me.

So what is the right answer? When I contacted Post reporter R. Jeffrey Smith, he claimed that he was sure that the towel definition was correct based on his reporting. But New Yorker writer Jane Mayer uses the submerging definition in an article in the latest issue of the magazine:

According to the [New York] Times, a secret memo issued by Administration lawyers authorized the C.I.A. to use novel interrogation methods—including "water-boarding," in which a suspect is bound and immersed in water until he nearly drowns. Dr. Allen Keller, the director of the Bellevue/N.Y.U. Program for Survivors of Torture, told me that he had treated a number of people who had been subjected to such forms of near-asphyxiation, and he argued that it was indeed torture. Some victims were still traumatized years later, he said. One patient couldn't take showers, and panicked when it rained. "The fear of being killed is a terrifying experience," he said.

The New Yorker is a carefully fact-checked magazine. It's possible Mayer is depending on the Times reporting, which uses the submersion definition, but it's hard to believe that wouldn't have been independently verified. Once again, what's the right definition? The mainstream media is continuing to fail to precisely define a key term in the debate over US interrogation practices.

MoveOn.org nonsense on Social Security

MoveOn.org is back with its second misleading attack on President Bush's proposal to create private accounts in Social Security (for part 1, see this post).

The best part is that the group's criticism of Bush's plan ends up promoting the same confusion as the White House by suggesting that private accounts and calculating benefits using "price indexing" are necessarily related. The truth is that they are two separate issues. Yet MoveOn makes the following highly suspect claim in an email to supporters:

Social Security privatization requires diverting taxes used to pay current benefits into private accounts. Without that money, Social Security benefits will inevitably be cut -- up to 46 percent for future retirees. Even under rosy projections the private accounts don't make up the difference. The deepest benefit cuts are for young people. Somebody in their twenties today would see benefit cuts as high as 30 percent. Should we really have to pay for Bush's risky private accounts with our guaranteed benefits?

The claim that private accounts "inevitably" lead to benefit cuts of up to 46 percent is ridiculous. The 46 percent figure refers to someone receiving benefits in 2075 if those benefits have been calculated according to what is called "price indexing". We could switch to price indexing whether or not private accounts are created, and private accounts would not necessarily require such deep benefit cuts if other sources of revenue were found.

MoveOn also buys into Bush's spin when it writes that, "[e]ven under rosy projections, the private accounts don't make up the difference." Private accounts don't "make up the difference" at all; despite occasional suggestions to the contrary, even the White House has admitted that they do nothing to improve the financial state of the Social Security system.

Here's yet more nonsense:

Social Security is not going bankrupt, contrary to the president's claims. That is a deception perpetrated in order to create the urgency for radical changes. Under conservative forecasts, the long-term challenges in Social Security do not manifest themselves until 2042. Even then Social Security has 70 percent of needed funds.

In fact, the "long-term challenges in Social Security" manifest themselves long before 2042. Bush's claims of an impending crisis, bankruptcy, etc. are exaggerated, but the system will be running large deficits that will strain the federal budget for years before the trust fund is completely exhausted.

Finally, MoveOn makes tendentious claims about Bush's motives:

So who does benefit? George Bush's base. Giant financial services firms have been salivating for decades over the prospect of taking over Social Security. They'd make billions in new fees -- essentially a new tax -- off of our Social Security payments.

As I pointed out before, if Bush wanted to maximize the fees received by Wall Street firms, he would hardly be pushing to model the system on the federal Thrift Savings Plan, which offers only five low-expense index funds. Talk about partisan hackery.

The 2009 bait and switch, contd.

In a briefing on the President's budget last week, OMB director Josh Bolten played yet more games with the phony deficit reduction plan. Here's Reuters:

Joshua Bolten, the White House budget director, played down the impact of the private accounts on future budget deficits, saying it "is still consistent with the president's goal to cut the deficit in half by 2009" and will not hurt the economy.

But when you read the fine print, you'll discover that the private accounts only start in 2009 under Bush's proposal and ramp up in cost dramatically after that. According to Reuters, "When these transition costs are factored into the administration's budget forecasts, the deficit would grow by $23 billion in fiscal 2009 to $256 billion, and by $56.5 billion in fiscal 2010 to $263.5 billion, White House budget officials said."

Bolten's response?

Bolten said the impact on deficits would grow in the years that follow, but he offered no specifics.

"I expect it would ramp up. I don't have numbers for that, but I expect it would become larger as a nominal figure beyond 2010," he said.

Thanks Josh! Even though Dick Cheney has admitted that private accounts would cost trillions in later decades, all Bolten is willing to concede is that "it would become larger as a nominal figure beyond 2010" - phrasing that falsely suggests that the increased costs simply represent inflation.

Update 2/14: The Washington Post has more on how "Bush's extensive tax cuts, the new Medicare prescription drug benefit and, if it passes, his plan to redesign Social Security all balloon in cost several years from now." It's what one analyst calls "a budgetary perfect storm." And it's been obscured by the sort of trickery used by Bolten above.

Why Super Bowl ads might not be such a bad deal

On Slate, Tim Noah claims that "buying commercial time on the Super Bowl is a waste of money!" His justification is that the cost per thousand viewers of the ads has tripled since 1970, a much greater increase than the price for ads on general network programming. As a result, it's possible to reach up to 60% more adults 18-49 through a combination of ad buys than you can by paying for one Super Bowl ad.

But Noah misses the reason the Super Bowl is so important - tens of millions of people all watch the same show, including the ads. What that means is that you know other people watched the ads, and they know you know they watched it, and so forth. UCLA political scientist Michael Chwe has written an excellent paper (PDF) making this argument (which he extends in his book Rational Ritual). Chwe argues that ads on popular shows command a premium because they help solve a coordination game for advertisers of "social goods" - items like cars, sneakers and beer in which my preferences depend in part on what other people like. As a result, those companies pay extra for ads on popular shows.

This logic extends most strongly to the Super Bowl, which creates more common knowledge than any other TV event. As Chwe points out, it was completely logical that Apple debuted the Macintosh during the Super Bowl with its famous "1984" ad. You would only feel confident buying a Mac if you knew other people were going to do as well. And you can apply this same logic, for instance, to recent Monster.com Super Bowl ads; job seekers will only go to the firm's website if firms are advertising on it, and vice versa. The ads help create the common knowledge necessary for the company to succeed.

Super Bowl advertising may be overpriced, but for producers of "social goods," there's just no substitute.

Martin O'Malley shames himself

Unacceptable - Baltimore mayor Martin O'Malley compares Bush's budget to the 9/11 attacks:

"Back on September 11, terrorists attacked our metropolitan cores, two of America's great cities. They did that because they knew that was where they could do the most damage and weaken us the most," O'Malley said. "Years later, we are given a budget proposal by our commander in chief, the president of the United States. And with a budget ax, he is attacking America's cities. He is attacking our metropolitan core."

But he didn't mean what he obviously said!

In an interview, O'Malley said he "in no way intended to equate these budget cuts, however bad, to a terrorist attack."

"The point I am trying to make is, for America to be strong, we have to strengthen our cities. Because we're in the middle of a war, we need to be strengthening and protecting our cities, not weakening our cities. Two of our cities have already been attacked in this war."

What a leader.

The worst "Bushism" yet?

At Spinsanity, we showed how Slate's "Bushisms" and "Kerryisms" columns twisted the two men's words to reinforce pre-established storylines. Now Eugene Volokh, the UCLA law professor/blogger who is one of the chief critics of "Bushisms", has nailed what might be the worst one yet:

Slate's quote of Bush (subsequently deleted): "Listen, the other day I was asked about the National Intelligence Estimate, which is a National Intelligence Estimate." — Washington, D.C., Sep. 23, 2004

Bush's actual statement (Real Audio - go to 30:54): "Listen, the other day I was asked about the NIE, which is a National Intelligence Estimate."

Now, Slate was fooled by an inaccurate White House transcript. But that's no excuse -- given that Bush's statement as quoted is nonsensical, they have an obligation to check it carefully before calling him an idiot. Not exactly responsible journalism.

What is Robert Samuelson talking about?

Washington Post economics columnist Robert Samuelson, fresh from forgetting the history of Bush's budget plans, is back with another masterpiece:

The unspeakable truth -- unspeakable because hardly anyone speaks it -- is that benefit cuts are inevitable, because the baby boom's retirement costs will force them. The combined spending of Social Security and Medicare, according to government projections, would require at least a 30 percent tax increase by 2030. "Personal accounts" don't come close to closing the gap. Sooner or later, chances are there will be a political backlash or a budget crisis. The wiser policy is not to wait; it is to pare benefits now.

It's true that some benefit cuts are inevitable. But this passage is a mess. First, Samuelson conflates Social Security and Medicare, but as this chart illustrates, Medicare is a vastly larger problem over time. Second, the tax increase figure from 2030 exaggerates the problem by assuming we do nothing for 25 years; the funding gap in Social Security can be closed with a more modest combination of revenue increases and benefit cuts if we act today. Medicare, on the other hand, is a much more serious problem. Third, it's misleading to say that personal accounts "don't come close to closing the gap"; they don't do anything to close the gap, as even the administration admits. In fact, they make the Baby Boom funding crunch worse by requiring the government to take out trillions in new debt.

What's especially annoying is that Samuelson acknowledged the first two points in a previous column. Unfortunately, the compressed version isn't nearly so clear.

Cato and Bush keep using "privatization"/"private accounts"

Very interesting - I just received a fundraising letter from the Cato Institute, and they use the term "Social Security privatization" right on page 1 even though conservatives are waging a campaign against use of the term. Cato did change the name of their Social Security project from "Project on Social Security Privatization" to "Project on Social Security Choice", but apparently they haven't completely given into the dictates of the pollsters.

And, contradicting those in his party who have disavowed the phrase "private accounts," President Bush went off-message recently too, referring to a "private account" and "private retirement account" during a speech in Florida. When politicians can't even keep their own spin straight, you know we're in trouble...

The machine back at work

The Republican machine that savaged Tom Daschle from 2001 until his defeat in November has turned its attention to Harry Reid, the new Democratic leader in the Senate. Here's the story from Roll Call (via Tapped):

The Republican National Committee is set to begin a prolonged attack against newly installed Senate Minority Leader Harry Reid (D-Nev.) aimed at weakening his support in his home state as well as on the national level.

Drawing on a blueprint used successfully against former Senate Minority Leader Tom Daschle (D-S.D.), the RNC will send a 13-page research document today to roughly 1 million people — a group that includes journalists, donors and grass-roots activists — detailing Reid’s alleged obstructionism among other topics.

“This is the initial salvo in the upcoming discussion that we are going to be having with Sen. Reid,” said RNC Communications Director Brian Jones.

RNC Chairman Ken Mehlman has already done a series of radio interviews in Nevada criticizing Reid. Other events, like a gathering of medical professionals in the Silver State to protest Reid’s stance on medical malpractice reform, are in the works.

“This is a national and local communications strategy that will look to strip the bark off the Senate Minority Leader,” Jones added.

This RNC research document is the first prong of the assault, which Reid denounced yesterday.

For a primer on how these tactics work, see the Spinsanity archive of analysis of attacks on Daschle, as well as Chris Mooney's American Prospect article on the offensive. Kevin Drum reminded me of the most disturbed attack, which was Rush Limbaugh's description of Daschle as "El Diablo" (aka the devil). I happened to be listening to Limbaugh that day, so Spinsanity was the first to publicize the attack -- see the full transcript of the rant or our original article on it.

In any case, I'm no fan of Harry Reid after working in politics in Nevada, but these sorts of demonization campaigns always turn nasty regardless of whether it's a Republican (Newt Gingrich) or a Democrat (Daschle) in the crosshairs.

The not-so-responsible era

George W. Bush, 3/7/02: "America is ushering in a responsibility era; a culture regaining a sense of personal responsibility, where each of us understands we're responsible for the decisions we make in life."

The missing pieces:

The [President's] budget is notable for including limits on spending that are unlikely to be enacted and for excluding expenses that are sure to be incurred. Here are the most important points:

-It assumes that all discretionary spending outside of military and domestic security - everything from paperclips to space shuttles - will be frozen for the next five years.

-It includes no spending for the war in Iraq and Afghanistan in 2006. Those costs are now running about $5 billion a month and are likely to continue at some level in the 2006 fiscal year and beyond.

-It omits the initial cost of Mr. Bush's Social Security plan, which would let people divert some of their payroll taxes to private saving accounts. Administration officials estimate the plan would cost $23 billion in 2009 and $754 billion over the next decade.

-It leaves out the cost of reining in the Alternative Minimum Tax, a tax that was created to affect the nation's wealthiest taxpayers but is now ensnaring millions of moderate-income families as incomes rise with inflation

The excuses:

The spending plan [White House budget director Joshua] Bolten outlined was a model of fiscal responsibility. But as he fielded questions for an hour, it became steadily clearer why the new budget seemed so restrained: The White House left out a lot of expenses the government is likely to have, while including savings the government is unlikely ever to see.

For example, Bolten granted that it is certain that more money will be needed for Iraq and Afghanistan in 2006 and beyond. "But," he added, "it wouldn't be responsible for us to take a guess at what those costs are."

Yet, moments later, Bolten explained why it was perfectly responsible to guess about new revenue from drilling in the Arctic National Wildlife Refuge -- even though such a program has not been approved by Congress. "Well," he said, "the budget is the right place to present the entirety of the president's policies, so all of his proposals are reflected in there."

The theme repeated itself throughout Bolten's briefing: Potential good news was embraced, and potential bad news was left out of the equation. How about the hundreds of billions of dollars the government would borrow to convert Social Security to personal accounts under Bush's plan? Not included. "The budget went to bed . . . before the president's proposals were announced," Bolten explained.

Nor are the hundreds of billions of dollars that it would cost to change the alternative minimum tax, which Bush had vowed to do as it hits more middle-class taxpayers. "It does need to be reformed," Bolten said, but it is not in the budget forecasts.

...Some of the questioners were clearly skeptical about the administration's assumptions: its decision to focus on growth in "non-security discretionary spending" (which ignores 80 percent of the federal budget), its belief that such spending could be held steady for five years (it has never happened before), and its dropping of 10-year budget forecasts (they show exploding deficits).

No quantity of skepticism, though, would disturb the budget director from his Zen state. "None of this makes us feel uncomfortable," he said.

"The new conservative political correctness"

E.J. Dionne notices the nasty new racial politics being practiced by conservatives:

[I]ncreasingly, it is conservatives who are using political correctness to sidestep hard issues. Consider the bait-and-switch in the Gonzales case: Democrats thought it appropriate to use Gonzales's nomination to launch a debate about torture policy. Gonzales is Latino. Therefore, Republicans insisted, Democrats who wanted to debate torture policy were anti-Latino.

How to actually build an ownership society

The New America Foundation's Ray Boshara makes a strong case for promoting asset ownership through social policy in the Washington Post today, including establishing "a privately owned 'KIDS Account' at birth for each of the 4 million children born in this country every year and fund those accounts progressively -- thus creating a lifetime platform for saving, asset accumulation, retirement security and wealth that can be bequeathed." This is a cause I've believed in for a long time, and one with increasing bipartisan support.

In the New York Times, meanwhile, David Brooks offers a paint-by-numbers version of the same argument. He says Bush might want to shift from his push for private accounts in Social Security to an asset promotion plan (yes!), but then things go off the tracks:

The Social Security problem is a chance to enact this kind of thing on a decisive scale, with the KidSave proposal serving as a framework for a new vision of personal accounts.

We could start by indexing Social Security benefits to prices, not wages, so the system wouldn't go broke. Then we could give everybody under a certain age KidSave accounts. This money could either supplement the reduced Social Security benefits, or individuals could divert some of their payroll taxes into their KidSave accounts, trading guaranteed benefits for more ownership.

We'd have to take care of today's 20-somethings, who are already too old to benefit from the new accounts, but this proposal would lead to less red ink than the president's current plan. And let me commit an act of heresy: it would be smart for Republicans to forgo making the Bush tax cuts permanent in exchange for these kinds of accounts. The Bush cuts are going to be repealed by the next Democratic president anyway, but these accounts, once created, would be forever.

If people can divert their payroll taxes into the KidSave accounts, it creates most of the same problems as Bush's current proposal, and is likely to face most of the same opposition. Price indexing will also be fiercely opposed by Democrats. This ends up sounding like a repackaged version of Bush's current proposal. Despite Brooks' preening, it is not going to break the logjam on Capitol Hill. He's right to call for rolling back some of Bush's tax cuts, though; if we could use some of that money to pay for the asset-building accounts and figure out a separate, bipartisan package of fixes for Social Security, then we'd really be making progress. That's utterly unrealistic, of course, but it highlights the problem - there's no money for these accounts in the general budget without tax cut rollbacks. Bush can only fund personal accounts by siphoning payroll taxes. So there are very few alternative options as long as the President holds the line on his signature policy initiative.

Redistricting reform fever!

The grassroots (and Gov. Arnold) are calling for an end to incumbent protection rackets from coast to coast. The New York Times documents the spread of a long-overdue movement:

The politically charged methods that states use to draw Congressional districts are under attack by citizens groups, state legislators and the governor of California, all of whom are concerned that increasingly sophisticated map-drawing has created a class of entrenched incumbents, stifled electoral competition and caused governmental gridlock.

Largely uncoordinated campaigns stretching from California to Massachusetts are pushing to end, or at least minimize, a time-honored staple of American politics: lawmakers drawing Congressional and legislative district maps in geographically convoluted ways to ensure the re-election of an incumbent or the dominance of a party...

Analysts and party officials said the chances of an overhaul of redistricting were better than at any time in recent memory, given what they said was rising concern about a system that seems increasingly prone to political manipulation.

In the 2004 Congressional elections, only 13 seats in the House changed hands, and four incumbents were defeated in the general election. In 2002, 82 percent of the races were decided by a margin of 20 percent or more, Common Cause said.

My question is this: Where's the institutional support for redistricting reform? We need a national nonprofit with in-house expertise in setting up independent commissions, running initiative campaigns, and so forth. Activists in each state shouldn't have to reinvent the wheel.

(Past posts on redistricting reform here.)

Reality check in the White House?

In the Times today, Edmund Andrews reviews what we've known for some time now -- namely, that the administration's fraudulent deficit-cutting "plan" is unlikely to lead to substantial deficit reduction.

But what's strange is that the administration and prominent conservatives are conceding more and more factual ground after years of up-is-downism (like Bush's claim that the 2001 tax cut reduced the deficit).

First, as Josh Marshall points out, Vice President Cheney conceded that private accounts require massive long-term borrowing, saying on "Fox News Sunday," "We're going to borrow $758 [b]illion over the next 10 years to set up the personal retirement accounts. We think that's a manageable amount ... Trillions more after that."

OMB spokesman Chad Kolton told Andrews that the administration's alleged plan remains operative, which is to be expected, but check out the Heritage Foundation's Brian Reidl blatantly contradicting the administration:

Even Mr. Bush's conservative allies have warned that those inflows will not be enough to cover the continued growth in overall government spending. Brian Riedl, budget analyst at the Heritage Foundation, a conservative research group here, estimated that deficits would remain around $400 billion through 2009 if current spending trends on Iraq and major benefit programs continued.

For Mr. Bush to fulfill his promise of cutting the deficit in half by 2009, Mr. Riedl said, the president would have to cut $200 billion from domestic programs that now cost less than $500 billion a year.

"There is no way you can reach that goal by cutting only discretionary spending," Mr. Riedl said. "You have to go after entitlements as well."

And a senior administration official recently conceded that private accounts would not alleviate the Social Security funding gap.

What's going on? Are the facts no longer biased? Is the administration rejoining the "reality-based community" instead of "creating other new realities"? Inquiring minds want to know.

(If I had to guess, these admissions will spark a run of bad press, and the candor will soon cease. This is what happened in the aftermath of the war in Iraq when the administration briefly offered concessions on the "sixteen words" about uranium from Niger.)

Clarke on democracy promotion

Richard Clarke kicks off his New York Times Magazine column with a useful primer on why President Bush is wrong to claim that establishing democracies in the Middle East will prevent terrorism. The claim is self-evidently false -- to take one example, what about all the Islamic terrorists from Europe? -- but I'm glad to see Clarke shooting it down since so many people appear to take comfort in it. If only the world was so simple...

An honest anti-privatizer

Private account opponents are becoming annoyingly glib about the real financing issues that Social Security faces, which is only going to make it harder to muster the political will that we're going to need to alleviate the shortfall (either now or down the road). So I was happy to see Jeff Madrick offer an intellectually honest take on the problem in Salon:

[T]here are genuine concerns. For years now, baby boomers and others have been paying more in payroll taxes than has been needed to meet the needs of retirees. The federal government has of course spent the surplus, but it has placed Treasury bonds in a trust fund to be paid off when needed. And needed they may well be around 2018 when, as the president noted, Social Security payments will begin to exceed the payroll taxes collected.

Will the bonds be paid off? Of course they will. The Treasury will not renege on its obligations. But there will also be pressures on the budget, and Democrats are too flippant about this. If the nation is still in deficit, other programs may have to be cut or the Treasury may have to borrow more in the financial markets.

When the trust fund is eventually run down -- the Social Security Administration estimates that will happen around 2042, but some think it won't happen until the 2050s -- the system, based on current projections, will surely need new sources of revenues or cuts in benefits paid.

The problem is not so much the projected date of trust fund insolvency -- a highly uncertain projection -- but the increasing strain on the federal budget once Social Security moves into deficit and begins to redeem the Treasury bonds it has accumulated. Medicare's rapidly increasing costs and the general fund deficit are bigger problems, but Social Security's funding gap is a significant concern (and one that private accounts do nothing to solve). Good for Madrick.

Farm subsidies on the chopping block

If only Nixon could go to China, maybe only George W. Bush can break the logjam preventing reform of our disastrous agricultural subsidy programs. I'm sure Congress will hold the line this time around -- agricultural states are vastly overrepresented in the Senate relative to population -- but it's a start, at least:

President Bush will seek deep cuts in farm and commodity programs in his new budget and in a major policy shift will propose overall limits on subsidy payments to farmers, administration officials said Saturday.

Such limits would help reduce the federal budget deficit and would inject market forces into the farm economy, the officials said.

The proposal puts Mr. Bush at odds with some of his most ardent supporters in the rural South, including cotton and rice growers in Alabama, Arkansas, Georgia, Louisiana and Mississippi.

The new chairman of the Senate Appropriations Committee, Thad Cochran of Mississippi, and more than 100 farm groups are gearing up to fight the White House proposal. The administration's willingness to push the proposal, despite such protests, suggests how tight the new budget will be.

Most of the subsidies are paid to large farm operators growing cotton and rice and, to a lesser degree, corn, soybeans and wheat.

Mr. Bush would set a firm overall limit of $250,000 on subsidies that can now exceed $1 million in some cases.

In the Times article, officials at both the lefty Environmental Working Group and the conservative Heritage Foundation make a case against subsidies -- how often do you see a combination like that? Bush's proposal may be a signal that the left-right anti-subsidy coalition is gaining ground.

Update 2/7: Ezra Klein agrees, but points out that Bush signed a bad farm bill that exacerbated the problem in 2002 -- a good point.

Bush's assertions about investment returns

During a visit to Nebraska yesterday, President Bush made the following set of claims:

[A] personal retirement account will earn a greater rate of return than that which your money earns in the Social Security trust. That's an important point for people to understand. If you invest your money in conservative stocks and bonds, you're likely to get around a 4 percent rate of return, which is greater than double than the money you're earning right now in the Social Security trust. And over time, that means your own money will grow faster than that which is in the Social Security trust. In other words, you'll have more money when it comes time to retire. That's what that means. And that's an important concept.

First, it's not necessarily true that a private account will perform better than Social Security as Bush and other White House officials repeatedly assert, though it is likely over the long run based on the historical performance of the stock market. Treasury Secretary John Snow admitted this possibility on the December 19, 2004 edition of "Fox News Sunday":

They [younger workers] take money that would be going into the system, it gets put into these personal accounts. They reduce their claim on the system, but they get the personal accounts as a nest egg, which will grow faster, at least have the opportunity to grow faster, than the reduction in the payout from Social Security itself.

In addition, Bush is falsely implying that the appropriate comparison is between a 4 percent rate of return for private accounts and a 1-2% rate of return for the normal guaranteed benefit. But this is misleading. The "benefit offset" that he never mentions would reduce guaranteed benefits for private account holders by 3 percent per year above inflation, so workers would only increase their net benefit if their annual returns are greater than 3 percent. This isn't fine print; it's the way the plan would work, and Bush is directly misleading his audience about it.

Dean's "Hillary Rules"

The American Prospect's Garance Franke-Ruta passes along an astute observation on Tapped:

One of the smartest centrists I know recently noted that Dean will be operating, in Washington, under "Hillary Rules." This is certainly true; anything Dean says will be subjected to tremendous scrutiny, and he will be operating with no room for error. And so perhaps the best choice for Dean would to be follow Hillary Clinton's lead by putting his head to the grindstone, staying off television, and quietly going to work. Already, there is some indication that he recognizes this may be his best course of action.

That's pretty sanguine. Reporters are going to have keyboard shortcuts that output stories like "Temperamental DNC chairman Howard Dean today said '[stupid, off-the-cuff remark]', offending [various blue state voters]. [Crazed left-wing blogger] defended the remark, alleging a media conspiracy driven by Fox News." It's like Mad Libs.

The problem Dean has is that the media narrative has been written, and once established they are almost impossible to break (see: Al Gore is a liar, George Bush is stupid, etc.). And because Democrats have so few compelling personalities in the spotlight, the press will go over everything Dean says with a fine-tooth comb. Plus, if he couldn't restrain his rhetoric during a campaign to be president of the United States, why would anyone think he could do it now?

The Democrats will soon regret the way they ran their selection process, which was shockingly incompetent and venal. Allowing your party chairmanship to be determined by open pandering to 447 DNC members is not "democratic," as Noam Scheiber points out; it's just bad politics.

The White House beats down the press

Lori Robertson has a long article in American Journalism Review about the relationship between the White House and the press. It covers most of the same ground as chapter 2 of All the President's Spin, but Robertson's piece is noteworthy for demonstrating how far the press and DC establishment have come toward acquiesing to the Bush style.

Here's the most important part of the lede:

The press has been butting up against this brick wall of White House communication policy, and complaining about it, for long enough that stories about on-message, no leaks, no dissent, et cetera, et cetera are becoming a bit clichéd. Some people are tired of hearing about it.

"Stop whining, all you nattering nabobs," says Stephen Hess, senior fellow emeritus at the Brookings Institution and a professor of media and public affairs at George Washington University. "Put yourself in the president's shoes and say, 'What's wrong with the way he did it?'.. That doesn't mean future presidents will do it."

Problem is, future presidents may very well do it. Many interviewed for this story suspect--and fear--that this administration's strategy will be a template for subsequent commanders in chief. An emphasis on tighter news management has been building as each successive administration learns from the previous one. A rigid approach to staying on message and a clampdown on access for reporters and the public have been increasingly used by the executive branch, a trend that began to take shape during the Reagan administration, if not earlier. The current Bush administration has shown that the method can be perfected, with little to no downside for the White House.

...Reporters and open-government advocates speak, often passionately, about why less and less access to the executive branch hurts the public's right to know. But from an administration's point of view, what's the incentive to talk more with the media? Better press coverage? That's not likely.

There's "no doubt in my mind, the next administration"--whether it's Democratic or Republican--"will build on what the Bush administration has been able to do," says McMasters.

Stop whining? Might as well. The press might want to get used to it.

Robertson asks a number of political operatives and journalists what incentive a future White House would have to not behave like Bush, and the answers she gets are "intangible and hypothetical," "awfully wispy and idealistic," and so forth. She offers some suggestions that reporters should go outside normal channels to dig up new information, but that's about it.

If the conclusion of one of the leading publications in American journalism is that reporters "might want to get used" to being manipulated and stonewalled, we're in big trouble. The outrage is fading, and being replaced by complacence as journalists realize how little leverage they have. If you want to see how bad things can get, read Paul Farhi's Washington Post article on the requirement that journalists covering an inaugural ball be followed by a "minder" at all times -- a potentially disturbing trend if it continues.

PS The article included updated press conference statistics, which illustrate the vast disparity between Bush and his predecessors - as of December 20, 2004, Bush had held 17 press conferences, compared with 44 by Bill Clinton and 84 by George H.W. Bush at the same point in their terms.

(Disclosure: Robertson quoted me in a recent AJR story on coverage of campaign 2004.)

Political reasoning for five-year-olds

I'll have a lot more to say about the Republican Social Security memo (PDF), but I have to start by joining Matthew Yglesias in ridiculing this passage from a suggested speech, which might be the dumbest thing I've ever read:

Let me leave you with a question: Why should young people who will retire around the year 2035 be forced to live with a system that was invented in 1935, especially when that system is in such deep trouble?

So many things have since changed then. When Social Security was created the Golden Gate Bridge didn't exist and neither did Mount Rushmore. You couldn't see the Wizard of Oz because it hadn’t been filmed and Cheerios hadn't been introduced as a breakfast cereal. Americans in 1935 couldn't imagine our world of cell phones, computers, or landing a man on the moon—and that was more than 30 years ago!

Times have changed, even if the values behind Social Security haven't. Young people ought to have a chance to do it differently than their grandparents. So let's press our leaders for this change now, and start putting money into personal accounts as soon as possible.

No Cheerios? We must get add private accounts to Social Security immediately!

More White House suggestions of zero benefits

In the New York Times this morning, the White House again exaggerates the plight of Social Security:

[A] spokesman for the White House, Trent Duffy, said, "The president welcomes comments from members of Congress about how to fix Social Security, as opposed to those who want to ignore the problem and leave our children and grandchildren empty handed."

In fact, according to the Social Security actuaries, no one will be left "empty handed." In 2042, when the trust fund is projected to be exhausted, the system will be able to pay approximately 73 percent of scheduled benefits, which will still be worth more than what seniors receive today. This is part of a long pattern of the administration suggesting that future retirees will not receive benefits by saying the system will be "flat bust," "broke," "bankrupt," and so forth (also see this post). It's nonsense.

Senior scare tactics not a strawman

Thomas Lang, one of the indefatigable CJR Daily bloggers, claims in a new post that this passage from an AP report is mistaken:

President Bush, on a campaign-style road trip to pressure recalcitrant Democrats and reluctant Republicans on a Social Security, warned Friday against "scare tactics" in the burgeoning debate.

The president decried the kind of opposition campaigns now being waged against his proposals, saying they mislead seniors into thinking they won't get the Social Security checks on which they depend.

Lang writes (italics in original):

There is strong opposition to Bush's Social Security proposals. But we know of no example of opponents suggesting that current recipients of Social Security checks could be shortchanged by Bush's plan. It's an interesting accusation, but it's one that no one has made. And AP owes it to its readers to point that out.

But Factcheck.org has made that precise accusation against MoveOn.org's new TV ad, as I noted, and I think they're correct about it. And here's Terry McAuliffe doing the same thing in an email to supporters that I flagged a few weeks ago for suggesting that Bush is going to cut Social Security for today's seniors:

We will fight President Bush and his Republican cronies as they try to:

...Undermine Social Security for today's seniors and future generations of retirees by privatizing the system.

I'm sure there are more examples - feel free to add them in comments below.

"A Suicidal Selection"

The always insightful Jonathan Chait makes the definitive, devastating case against Howard Dean becoming chairman of the DNC:

The conventional rap against Dean as DNC chairman is essentially the same as the conventional rap against him as presidential candidate a year ago. Namely, he reinforces all the party's weaknesses. Democrats need to appeal to culturally traditional voters in the Midwest and border states who worry about the party's commitment to national security. Dean, with his intense secularism, arrogant style, throngs of high-profile counterculture supporters and association with the peace movement, is the precise opposite of the image Democrats want to send out.

The conventional rap is completely right. But, in a way, Dean is even less suited to run the DNC than he is to run for president.

The DNC chairman has two main jobs. First, he transmits the party's message — an important role when the party lacks a president and majority leaders in Congress. This job requires one to master the dismal art of "message discipline," boiling down the party's ideas into a few simple phrases and repeating them over and over until they have sunk into the public consciousness.

It's a role for which Dean is particularly ill suited. During his campaign, remember, he fashioned himself a straight talker, delighting reporters by repeatedly wandering "off message." On the plus side, he won friends in the media by appearing honest and human. On the negative side, he did himself enormous damage, when, for example, he suggested that he wouldn't prejudge Osama bin Laden until he had been convicted in a court of law.

For presidential candidates, the negatives of "straight talk" usually outweigh the positives... In a job like party chairman, a loose cannon is nothing but downside.

The second major task of the DNC chairman is to run the party organization. And here, if this is at all possible, Dean looks even worse. Garance Franke-Ruta, who wrote sympathetic Dean pieces in the American Prospect during the campaign, spoke with several former Dean staffers. One called the candidate "a horrible manager" and added, "I wouldn't trust him to run a company." Another called his management style "just a disaster."

More fine print - the "benefit offset"

The Washington Post fills in more details on how private accounts are not a free lunch. Note: The Post has corrected the story linked above, so I deleted the quote from the original version that was here before and added the new one below, which explains how the "benefit offset" works. Somehow, this didn't make it into the State of the Union...

[U]nder the proposal, workers who opt to invest in the new private accounts would lose a proportionate share of their guaranteed payment from Social Security plus interest. They should be able to recoup those lost benefits through their private accounts, as long as their investments realize a return greater than the 3 percent that the money would have made if it had stayed in the traditional plan.

That 3 percent level is the interest rate earned by Treasury bonds currently held by the Social Security system.

The Post mistakenly reported that the balance of a worker's personal account would be reduced by the worker's total annual contributions, plus 3 percent interest. In fact, the balance in the account would belong to the worker upon retirement, according to White House officials.

...What Bush did not detail is how contributions in the account would reduce workers' monthly Social Security checks. Under the system, described by an administration official, every dollar contributed to an account would be taken from the guaranteed Social Security benefit, with interest.

"The person comes out ahead if their personal account exceeds a 3 percent real rate of return, which is the rate of return that the trust fund bonds receive," the senior administration official said. "So, basically, the net effect on an individual's benefits would be zero if his personal account earned a 3 percent real rate of return. To the extent that his personal account gets a higher rate of return, his net benefit would increase."

If a worker sets aside $1,000 a year for 40 years, and earns 4 percent annually on investments, the account would grow to $99,800 in today's dollars. All of that money would be the worker's upon retirement. But guaranteed benefits over the worker's lifetime would be reduced by approximately $78,700 -- the amount the worker would have contributed to Social Security but instead contributed to his private account, plus 3 percent interest above inflation. The remainder, $21,100, would be the increase in benefit the worker would receive over his lifetime above the level he would have received if he stayed in the traditional system.

Under the system, total benefit gains may be minimal. The Social Security Administration, in projecting benefits under a partially privatized system, assumes a 4.6 percent rate of return over inflation. Thus gains in an account would be offset by a reduction in guaranteed benefits equal to 70 percent of the account's balance.

The Congressional Budget Office, Capitol Hill's official scorekeeper, assumes a 3.3 percent rate of return. Under that scenario, the full amount in a worker's account would be reduced dollar for dollar from his Social Security checks, for a net gain of virtually zero.

If investments earned less than 3 percent a year above inflation, a worker would do worse in total benefits than he would have done in the traditional system.

Bush budget trickery goes down the memory hole

A prize to Andrew Sullivan, who wrote this while blogging the SOTU, in which Bush claimed that his upcoming budget "stays on track to cut the deficit in half by 2009":

FISCAL SANITY? I'm having trouble believing this president on that particular issue. 2009? I thought the goal was 2008. And why not balance the budget? You know: like Clinton did.

He's absolutely right, unlike Robert Samuelson and many others in the media who have completely forgotten the history of these "plans".

To review: In July 2003, the Mid-Session Review was released by Bush's Office of Management and Budget (2.6 MB PDF). It promised that that the deficit would be cut in half by 2008, a claim the administration touted intensively for months. But as we recounted at Spinsanity, the "plan" excluded a number of costs that the administration supported.

In early 2004, a second "plan" to cut the deficit in half was released that also excluded a number of costs supported by the administration. This new five year plan pushed the target date back to 2009. (Note: We recount all of this in Chapter 7 of All the President's Spin if you want to read the full story.)

Now Bush is again touting the so-called plan, but once again it excludes a series of likely costs and makes implausible budgetary assumptions. In addition, the White House is using an inflated deficit projection as the original figure that is being cut in half (rather than the actual deficit for 2004) to make their goal easier to achieve.

Will reporters explain this pattern of deception and point out how the administration keeps shifting the goalposts? Do they even remember any of this?

The AP fact-checks Bush so I don't have to

Calvin Woodward explains the (misleading) free lunch implications of the SOTU:

The devil was in the missing details Wednesday night when President Bush showcased his Social Security plan and claimed advances on jobs and against terrorism that don't tell the full story.

Bush explained in detail how, under his proposal, younger workers would be able to divert some of their Social Security payroll taxes into private accounts "so you can build a nest egg for your own future."

Nowhere in his State of the Union speech did he give the other side of the equation — that Social Security benefits for those workers would be reduced as a result. He stated "your account will provide money for retirement over and above the check you will receive from Social Security," without explaining that check would be smaller.

Moreover, he seemed to issue a guaranteed return on investment for people putting some of their retirement money in the market, saying: "Your money will grow, over time, at a greater rate than anything the current system can deliver."

Although his plan promises checks and balances to ensure such money isn't frittered away on risky investments, it does not come with a guarantee of performance exceeding benefits of the current system.