Quote:
Originally posted by sgtclub
I'm think I understand what you are trying to say, but I'm not sure I agree. What does the supply/demand equation look like in your model?
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I have no idea what you are asking me. I know that as the supply of cummerbunds goes up, the demand for zabaglione comes down. Or something like that -- Microeconomics was a long, long time ago.
What I'm saying is this: The net effect will be that the people who benefit most from the "wealth creation" effect are the people who are already wealthy. I.e., the people who have money in the market now, before we start pumping in a $30 billion a month of formerly-SS money. Meanwhile, that new money will have less purchasing power in an inflated stock market, making the investments less valuable and, ultimately, more risky.
So, we are putting the safety net at risk, and putting the government another few trillion into debt, and risking a significant rise in interest rates.... in order to benefit most the people who need it least. Can you say "wealth transfer"?
And yes, I think the White House understands this. And yes, I think that making wealthy people wealthier is one reason for the push -- but not the main reason. The main reason behind the push to fundamentally change Social Security is ideological; it's the "ownership society" theory, with a spice of distaste for a New Deal program that has worked so effectively for so long.
