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Privatization Goes Public
It's been on the administration's agenda since day one.
Why all the fuss now about Social Security?

by Bill Berkowitz
October 22, 2004

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It may not be as sexy as the recent hullabaloo created by "compassionate conservative" Republican Party spokespersons "protecting" the honor of Mary Cheney, the lesbian daughter of vice president Dick Cheney, and it may not have the tumultuous effect as the revelation -- in the last days of the 2000 presidential campaign -- of President Bush's previously undisclosed DUI arrest in Maine, but it's good to see a serious political issue, the privatization of Social Security, get its day in the sun.

When Ron Suskind, the author of the best-selling book "The Price of Loyalty: George W. Bush, the White House and the Education of Paul O'Neill," revealed in a major New York Times Sunday Magazine piece on October 17 that in a secret meeting with some of his wealthy supporters President Bush talked about privatizing social security, all hell broke loose.

The Kerry campaign had a new television advertisement blasting Bush for wanting to privatize Social Security ready to roll within twenty-four hours. At campaign stops in Florida and Ohio, according to the Boston Globe, Senator Kerry "accused Bush of wanting to reduce benefits by as much as 45 percent for younger Americans in order to net $2 trillion for his proposed alternative to Social Security -- personal retirement accounts."

"This may be a good surprise for the wealthiest people and the well-connected in America, but it's a disaster for America's middle class," Kerry told supporters at the Mount Olivet Baptist Church in Columbus, Ohio. ''The president's privatization of Social Security is another way of saying to our seniors that the promise of security is going to be broken. Now once again, this president just seems to be out of touch with the real choices and real concerns of our fellow Americans."

As is its wont, the Bush Administration and its surrogates hacked away at the messenger -- Suskind -- and the New York Times. Republican National Committee chairman Ed Gillespie said that the Times was practicing "Kitty Kelley journalism" -- Kelley is the author of the current bestseller "The Family: The Real Story of the Bush Dynasty" -- and claimed that Bush never uttered the "P" word. Steve Schmidt, as spokesman for the Bush campaign said "The president has never used the word 'privatization' -- ever."

Several television news reporters on the campaign trail with the president, repeated Team Bush's denials. In a report about the new advertising buys in the battleground states by both campaigns, MSNBC's David Shuster called the Kerry Social Security ad misleading.

Why the hullabaloo over privatization? Privatization has been one of the central themes of the Republican Party's economic and social agenda for years. Over the past two-dozen years conservative and libertarian Washington, D.C.-based think tanks and right wing state-based public policy institutes have consistently touted a number of privatization schemes that covered everything from the delivery of a number of social services to the transformation of America's public lands.

In 1996, New York State's Republican Governor, George Pataki, who chaired the Privatization Task Force of the Republican Governor's Association, argued for the immediate repeal of federal barriers to privatization at the state and local levels: "Existing federal policies favor government ownership of infrastructure. We are not looking at privatization as a mandate. We just want the option to explore privatization... The federal government should aid and abet, not interfere with, our efforts."

At a Shavano Institute for National Leadership Seminar in 1997, Lawrence W. Reed, President of the conservative Midland, Michigan-based Mackinac Center for Public Policy, touted privatization as the wave of the future: "The superiority of [privatization]... is now approaching the status of undisputed, conventional wisdom."

Why then would GOP spokespersons recoil from the use of the "P" word? Why would the news media, certainly aware that the Bush Administration is populated by a cadre of former right wing ideologues who formerly served at the American Enterprise Institute, the Heritage Foundation and other conservative think tanks, shrink from facing the issue of privatization head on?

Historically, candidates talking about changing or "reforming" Social Security do so at their own peril -- it has often been described as the "third rail" in American politics -- and when the "P" word is connected to Social Security, America's senior citizens get stirred up. Seniors not only sit up and take notice, but they go to the polls come hell or high water. In this election, seniors make up a significant percentage of the electorate in some of the battleground states, particularly Florida and Ohio.

Bush's hot-button quote on privatizing Social Security appeared "near the end" of Suskind's 8,500 word article titled "Faith, Certainty and the Presidency of George W. Bush," Salon's Eric Boehlert pointed out. The piece focused on Bush and his senior aides' reliance on "faith" and their "gut," when making important policy decisions. According to Boehlert, "those who raise questions based on facts or 'reality' are cut out of the inner circle."

Suskind's discovery that President Bush employs "faith" and his "gut" as major decision making tools is certainly worthy of note, but isn't new. "No one in recent memory has pounded that pulpit for religion's role in government quite like the forty-third president," Stephen Mansfield wrote in the Introduction to his book "The Faith of George W. Bush," which was published earlier this year. Mansfield argued that Bush's "unapologetic religious tone" and his willingness to "speak of being called to the presidency, of a God who rules in the affairs of men, and of the United States owing her origin to Providence," clearly separate him from recent predecessors. In addition to having his legacy established by being president on 9/11, Mansfield writes, "another likely pillar of George W. Bush's legacy... is the matter of his religious faith and his attempts to integrate faith as a whole into American public policy."

While Bush's unorthodox decision making process might explain how the president has managed to make so many mistakes, it wasn't what caught the attention of the Kerry campaign and the media. It was Suskind's revelation of the September 15 luncheon with many of his major contributors where the president said, "I'm going to come out strong after my swearing in with fundamental tax reform, tort reform, privatizing of Social Security."

Suskind is no stranger to being in the GOP crosshairs. After his book with former Treasury Secretary Paul O'Neill, which argued that the Bush Administration immediately used the 9/11 terrorist attacks to begin preparation for a war with Iraq, Suskind was hammered unremittingly.

Now, however, despite the new GOP attacks, Suskind is sticking by his story. He pointed out in a subsequent piece for Slate that "quotations from the confidential luncheon were drawn from notes given to me by someone who attended the luncheon -- notes that were then confirmed by several others who were also in attendance.

"Bush has long wanted to make Social Security privatization look as noncontroversial as possible, even though many people have yet to be convinced that various proposals for private accounts are worthwhile and affordable."

Bill Berkowitz is a longtime observer of the conservative movement. His column Conservative Watch documents the strategies, players, institutions, victories and defeats of the American Right.

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