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Published: Sunday, 12/19/2004

Never was heard a discouraging word on economy

WASHINGTON - President Bush had a whimsical, fanciful, magical, notion - hold a two-day White House conference on the economy in which nobody said a negative word.

Not one bad word about his impossibly contradictory plan to cut the ballooning deficit in half in five years, make his tax cuts permanent at a cost of trillions of dollars we don't have, and partly privatize Social Security by borrowing an "upfront transition financing" cost of $2 trillion over 10 years.

Appropriately, the White House public-relations team decided to hold the conference in the cavernous Ronald Reagan International Trade Building. Mr. Reagan was the president who promised to cut the deficit, cut taxes, and increase federal spending. He left the largest deficit and pile of debt at the time in U.S. history.

Now, the national debt is $7.5 trillion and rising by millions of dollars every hour. It's making investors around the globe extremely nervous. Interest rates are rising. But there wasn't a word about that at the White House Conference on the Economy, subtitled "securing our economic future."

The feckless forum was fleshed out with eager young interns because no one who questions the President's policies was asked to attend. And there weren't enough business leaders who had contributed big bucks to Mr. Bush's re-election campaign also willing to fly to Washington a week before Christmas on their own dime to cheerlead for the President's zany plans. The two-day conference this past week was an astonishing display of how to shut out the opposition completely.

Mr. Bush has said he looked into Russian leader Vladimir Putin's soul and found a friend in the man he nicknamed "Pootie-poot." Apparently, if this conference is any guide, Mr. Bush found in Mr. Putin a model for authoritarianism. But even the old KGB chief couldn't have cobbled up such an absolutely meaningless discussion of the serious economic problems this country faces.

For a President who has promised to reach across party lines to try to figure out competent plans to deal with Social Security, the deficit, the unfair and monstrously complicated tax code, frivolous lawsuits, excessive government regulation, unaffordable health care, inadequate education, and the middle-class job squeeze, this conference was a joke.

Democrats predicted a dog-and-pony show, but said the event was worse than they expected. Sen. Jon Corzine (D., N.J.), a member of the Senate Budget Committee, said it was an "infomercial" for privatizing Social Security, a self-deceptive forum for grandstanding, a missed opportunity.

The Social Security "crisis" is Mr. Bush's top priority, he said this week. There is no immediate crisis - Social Security won't run out of money and benefits won't be cut for those now retired or about to retire. But from a high of 16 workers supporting one retiree, we're down to three and soon will be down to two. Mr. Bush is right to argue that now is the time to start figuring out what to do in 40 or 45 years when there could be a crisis.

But his plan is to borrow $2 trillion over 10 years to subsidize the system so younger people may set up private investment accounts. Social Security benefits make up 40 percent of a retired worker's former income. With privatized accounts, Social Security would pay 20 percent in benefits, potentially driving millions into poverty if the stock market tanked.

Also, Social Security pays the children of a deceased breadwinner until they turn 18. What would happen to them? And Social Security pays millions of disabled people. What would happen to them?

The nonpartisan Congressional Budget Office claims that the only way to shore up Social Security is to increase payroll taxes or to cut benefits. Some argue that the answer is to raise the cap on FICA taxes so that it doesn't stop at incomes above $87,000, raise the retirement age, and get more yield out of the Social Security trust fund. Mr. Bush says absolutely no tax hikes.

There are enormous ramifications to all of this that must be discussed and understood by every working person. This was a perfect time to launch the debate because Mr. Bush pledges action next year.

Mr. Bush insists the election gave him a mandate to create an "ownership society" by changing Social Security, although 50 percent of the people say that's not why he was re-elected. They worry they'd own nothing but debt and risk while Wall Street got a windfall of billions of dollars in fees.

Mr. Bush's tightly controlled, boring summit, after hours of happy talk, didn't even make a good case for his policies.

What a waste of time.



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