AN URGENT LETTER TO PRESIDENT BUSH

Dear Mr. Bush:
You may well become the greatest President in modern history. When it's all over you might well be credited with wining the war on terror, freeing 80 million people in Afghanistan and Iraq, pressuring the three remaining terrorist states (Syria, Iran, North Korea) toward democracy, bringing peace to Israel & Palestine, and, sticking a dagger in the heart of domestic liberalism by privatizing Social Security. Unbelievably, it is all in process now, but paying for privatizing Social Security is perhaps the biggest stumbling block along the road to potential greatness on which you are currently traveling.

There are actually many ways to pay for it but all have seemingly negative consequences of largely unknown political and economic impact. Perhaps the easiest way to pay for it is simply to require everyone to pay the Social Security tax on all of their income rather than only on the first $90,000. This would raise about $250 billion a year (40% of current Social Security revenue) and be more than enough to credibly fund private accounts. The problem is, it isn't fair since the top 20% (incomes above $90,000) of taxpayers affected already pay about 68% of all federal taxes. Additionally, it would be a crippling blow to many families living from paycheck to paycheck on $85,000 per year and up. Moreover, the tax collector found out the hard way, with the Luxury Tax on yachts and with capital gains taxation in general, that the govt can often collect more money with lower tax rates on the rich, and in so doing not destroy entire industries. And, lets not forget that if taxing the rich were really a viable strategy to satisfy the gov'ts lust for our money they would already have too much money. In fact, the top 1% pay 23% of all federal taxes. At some point the gov't has to learn to manage its money, rather than to steal more to cover up its mismanagement.

Borrowing the money, the current plan, has the fewest obvious political consequences because no particular voting constituency is hurt directly, although in the end all taxpayers would have to pay the money back. On the practical side though, we are already $8 trillion in debt as a nation. Too much debt can lead to higher interest rates which in turn can collapse the entire economy.

While borrowing is your choice at the moment it is such a simple choice that it gives your liberal critics a simple way to attack. All they have to do is pretend they care about fiscal responsibility, despite a vast history of exactly the opposite (most recently, opposition to the Balanced Budget Amendment, and, wanting a bigger prescription drug bill than even you), and they apparently have grounds on which to frighten the public against privatization and the freedom to own their own pensions. But, if you do insist on borrowing the money the best argument in support of it is to simply point out that $2 trillion invested today in private accounts means the gov't will have to pay out $10 trillion less, and tax $10 trillion less, in 40 years when the private accounts mature as recipients reach retirement age.

Another plan is to simply cap Federal spending at the current $2.57 trillion level which most Republicans agree is already a ridiculously high and wasteful level anyway. As the economy grows, increasing tax revenue would yield about $500 billion a year above the $2.57 trillion cap; again, more than enough to take our retirement plans away from the brain dead totalitarian Democrats who have made a horrible mess of the exisiting Social Security program.

The boldest choice by far is to wrap the impending Social Security crisis into the far bigger and more important Medicaid, Medicare, Veterans Affairs crisis which threatens to be 6 times as large. You could then reform Federal health care and use the savings to finance Social Security privatization. Some estimate Medicare alone wastes 2 million a day. Others say $26 billion a year in waste fraud and abuse. A new book claims a Travelocity Internet model where people bought drugs instead of travel would save $25 billion a year just on drugs.

The three gov't managed programs now are far bigger than Social Security and will grow far faster than the fast growing Social Security program over the next 30 years. Through direct payments and regulations these health programs control approximately half of all health care spending directly and 30% more indirectly. But, in so doing they discourage the basic competitive incentives that are present in any efficient capitalist industry. While prices should go down and quality up, as in, for example, personal computers, the opposite is happening in health care as a direct result of our "Socialism lite" health care system.

To get an idea about the massive scale of waste one merely needs to notice that our Rube Goldberg quasi-socialist health care system spends more than double what the comparatively sophisticated but still grossly inefficient health care systems of Europe spend (OECD has U.S. health spending at $4800 per capita; Europe at $2100). The results, amazingly, are virtually identical. Their health care is as good as ours! This means that it is realistic to think in terms of saving almost half on health care by merely making our system as efficient as the Soviet style mismanaged systems of Europe, and then saving half again by making our health care competitive rather than Soviet socialist European. The savings could finance Social Security for eternity.

So then Mr. Bush, it seems there are many ways to finance freedom from the Democrats. We will pray that as you and Karl Rove tread carefully through the bomb laden political waters that lie ahead you will pick wisely from among the alternatives. If you prevail in the eternal struggle against the Democratic enemies of freedom you will surely go down in history as one of our greatest Presidents. comments: bje1000@aol.com