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Ad Hominem

The gang at There Is No Crisis takes a good close look at USA Next. Give it a read, I'll say more on this later.

For now let me note what my friends on the right will no doubt note, which is that the argumentum ad hominem (and its close cousin ad funderam) are not, strictly speaking, relevant to the policy debate over privatization. That's all true. Nor is the fact that privatizers lie, constantly, about virtually every aspect of the Social Security situation strictly relevant. Nor is the fact that privatization's leading proponents in the electoral arena refuse to discuss the details of their policy proposal, strictly relevant to assessing the merits of the proposal. With all that in mind, I've done a number of pointy-headed posts about the issues laying out where I stand.

Nevertheless, lots of people don't follow pointy-headed arguments about the issues all that closely. Those people might be intetested to know that the privatization movement is being heavily financed by individuals with a direct financial stake in its success, and that the political professionals taking the privateers' money feel that the best way to sell the plan is to be dishonest about it while hiding its details from public scrutiny. Which is all a long way of saying, give it a read.

February 28, 2005 | Permalink

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Comments

Privatazing social security has no more to do with saving it than war in Iraq has to do with al Qaeda.

The proponents of privatization mostly think that the government should not be in the social security business. Why not be honest? Because the electorate disagrees.

Shame on the Democrats if they compromise with Bush on this after his lying about Iraq's nukes. Fool me once, shame on you, fool me ... won't get fooled again.

Posted by: epistemology | Feb 28, 2005 10:43:12 AM

Is this really even an ad hominem argument?

I think of ad hominem as: "That guy's wrong about Social Security because he's a child molester."

This, on the other hand, is an argument about bias: "That guy's wrong about Social Security because he has a financial incentive to lie about Social Security." Seems just fine to me.

Posted by: JP | Feb 28, 2005 10:48:07 AM

Those people might be intetested to know that the privatization movement is being heavily financed by individuals with a direct financial stake in its success

HUH???

I wonder if Matthew could point out who, exactly, are the funders who have a "direct financial stake" in the success of SS privitization. Because as I read it, NONE of the groups listed as supporting USA Next has such a stake. The "Sample of Funders" included in the report lists Arctic Power, Pfizer, PhRMA, Texans for Lawsuit Reform, and Bob Perry. Where is their stakes?

It looks to me as though Matthew's statement is just an out-and-out lie.

Posted by: Al | Feb 28, 2005 10:54:08 AM

What JP says. If bias inquiries are appropriate for cross-examination in a court room (which they are) they are more than appropriate for public discourse over Social Security. Regardless of whether the privateers succeed in implanting their private accounts phase-out toehold, it's perversely entertaining listening to them spin around amidst the chilly winds of shame...

Posted by: fnook | Feb 28, 2005 10:54:58 AM

To sharpen JP's point a little, if you imagine that your audience is using something like the following argument, then pointing out the funding is very relevant:

1. So-and-so has asserted that (e.g.) Social Security will go bankrupt in a few years.
2. So-and-so is trustworthy on questions about Social Security.
Therefore, 3. Social Security will go bankrupt in a few years.

This is a cogent (if not formally valid) sort of argument, and an extremely important one to be able to make in politics, since as MY notes, not everyone has the time, inclination, or ability to sort out all the policy particulars for themselves. So it can be both tactically important and, moreover, not a fallacy to present evidence that undercuts premise 2.

Posted by: Jonathan Weinberg | Feb 28, 2005 10:55:34 AM

Al demands literal proof of bias! So, are you prepared to argue that the privateers are motivated by altruistic concerns for their fellow man? Perhaps you are. I'm all ears. Perhaps you could also address the question posed by Matt. That is, why won't the president's supporters go on television and tell the American people that SS sucks and we should get rid of it asap because we need to transfer more wealth into private hands. That's what's happening here. That's proof enough for me.

Posted by: fnook | Feb 28, 2005 11:02:42 AM

How would we rank the 'real' motivations of the privateers?

My suggestions,

1. Political/idealogical - to destroy the notion that government can operate a large successfull social welfare program reinforcing the negative R propaganda of 'big government' and extolling the superiority of free market accumulation of wealth. The idea being to cut away a large portion of democratic support that currently believes in and relies on goverment social welfare programs.

2. Fiscal - Writing off SSA trust fund indebtidness making room in the federal budget for permanent tax cuts that shift the burden of taxation toward wage earnings whilst protecting wealth accumulation.

3. Crony capitalism.

Suggestions?

Posted by: postit | Feb 28, 2005 11:02:48 AM

A new twist involving the cast of characters financing the privateers efforts,

The Center for National Publicy Policy research - Abramoff and Delay

Posted by: postit | Feb 28, 2005 11:14:28 AM

1. The gang at There is No Crisis calls USA Next "the front group for Social Security privatization" -- "the" -- as if there are no other groups involved. At least the gang's intellectual standards haven't changed.

2. People who would benefit from legislation are supporting it? Shocking!

Posted by: ostap | Feb 28, 2005 11:22:37 AM

Al demands literal proof of bias! So, are you prepared to argue that the privateers are motivated by altruistic concerns for their fellow man?

Huh? All I asked is what support there is in the report for Matthew's statement that "the privatization movement is being heavily financed by individuals with a direct financial stake in its success".

In fact, it appears to me as though USA Next is an ideological lobbying group - no different than, say, I dunno, "There Is No Crisis". In both cases, they are trying to get their preferred policy into law. Big Whoop.

But what I do NOT see is where any of the funders of USA Next would make big bucks from privitization.

Posted by: Al | Feb 28, 2005 11:27:38 AM

Yeah, Al, Matt's lying, there is no financial benefit to Pfizer, they are doing charitable work here. You know, because it is not true that people defend their economic interests.

And JP is right. This is about bias, which is legitimate to point out, though not sufficient to disprove a case.

Posted by: epistemology | Feb 28, 2005 11:28:31 AM

Interesting story, postit.

I almost feel sorry for Delay.

While Bush and Cheney have made millions through family connections and crony capitalism, 'ol Tom was a dirt-poor bug killer before getting into politics. His pal Abramoff made $70 million just lying to tribes who wanted influence.

It must kill Delay to be one of the most powerful Republicans and also one of the poorest.

As for the motivations of the privateers, I would put crony capitalism as the #1 reason. Wall Street would make billions on it.

Posted by: monkyboy | Feb 28, 2005 11:29:09 AM

As someone planning to retire in 2042, I'd say that I certainly have a "direct financial stake" in the success of Social Security reform. I'd go so far as to say that just about anyone under 35 has a "direct financial stake" in its success.

Posted by: brooke | Feb 28, 2005 11:47:35 AM

Bias is not strictly relevant except to challenging the sources relaying of fundamental facts that are not independently verifiable in a policy debate. If their fundamental facts are independently verifiable, and their logic is sound, their conclusions stand independently of their bias.

OTOH, when a source of facts or an expert cited for unargued conclusions that cannot readily be independently verified is shown to have bias that might motivate the statements, it undermines credibility as to those unverifiable statements that are consistent with the bias.

Bias (or just plain proven history of dishonesty) is a basis for challenging statements for which biased or dishonest source must be trusted, but not a basis for challenging an argument which stands on its own independent of the source.

Posted by: cmdicely | Feb 28, 2005 11:55:13 AM

As someone planning to retire in 2042, I'd say that I certainly have a "direct financial stake" in the success of Social Security reform. I'd go so far as to say that just about anyone under 35 has a "direct financial stake" in its success.

There is a difference between having an interest in the success of a policy at its stated goal, and having a direct financial interest in the implementation of a policy independent of its success in achieving its stated goal.

Posted by: cmdicely | Feb 28, 2005 11:56:28 AM

Yeah, Al, Matt's lying, there is no financial benefit to Pfizer

Well, then, explain it to us dummies, please. Where is Pfizer's "direct" financial interest in privitization?

Posted by: Al | Feb 28, 2005 12:12:05 PM

The argument contained in the brief isn't necessarily that the funders of United Seniors have a financial interest in the privatization of social security. In fact, we can't know if there's a financial interest because United Seniors is a 501c4, and doesn't disclose its financil contributiors, clearly abusing the tax code. We were only able to figure out the PhRMA was the big money behind United Seniors in 2002 and 2003 because PhRMA talked to the media.

The key argument in the report is that United Seniors is a sham seniors organization. They act as though they care about seniors and seniors issues, but they are really nothing more that a "frightmail" group. They have never, not once, done a single good thing for seniors. They exist for two reasons: to get Republicans elected to office, and to advance bad policies from the conservative playbook.

They have been busted - twice - for trying to mislead seniors into donating money. That's not the sort of group we can trust in this debate.

Posted by: Dave | Feb 28, 2005 12:19:23 PM

Al:

Well, then, explain it to us dummies, please. Where is Pfizer's "direct" financial interest in privitization?

Pfizer has a libertarian's interest in keeping the government out of financing a "safety net" for Americans. The more laizes faire our system, the less government involvement, in general, the better for drug companies.

Al, do you seriously think you know Pfizer's interests better than they do? Pfizer's directors have a fiduciary responsibility to the stockholders. Even (well publicized) charity, like to the tsunami victims, accrues to their benefit, or why do it?

Posted by: epistemology | Feb 28, 2005 12:39:35 PM

"There is a difference between having an interest in the success of a policy at its stated goal, and having a direct financial interest in the implementation of a policy independent of its success in achieving its stated goal."

So these companies don't want SS reform to succeed at its stated goal? That's odd--I'd imagine that they would want the policy to succeed so that it could remain in place so the companies could continue to benefit. Their interest is not independent of success or failure--big business has an interest in seeing reform not just get implemented, but actually succeed. Success will lower their payroll tax burden and lower the cost of taking on new employees--mere implementation won't.

Posted by: brooke | Feb 28, 2005 12:39:49 PM

So these companies don't want SS reform to succeed at its stated goal?

Whether or not they want it to do that, they have vested interests in the policy independent of that.

That's odd--I'd imagine that they would want the policy to succeed so that it could remain in place so the companies could continue to benefit.

It is incredibly naive to assume that a policy's longevity is strictly tied to its actual success at achieving the goal used to sell it.

Their interest is not independent of success or failure--big business has an interest in seeing reform not just get implemented, but actually succeed. Success will lower their payroll tax burden and lower the cost of taking on new employees--mere implementation won't.

Since the plan, whether or not it succeeds, does not lower payroll taxes, except that it allows workers to divert some money into private accounts from their payroll taxes, this isn't true -- whether or not the plan succeeds.

Nevertheless, as long as people choose to invest in the private accounts (whether or not social security is stabilized by the plans, or people end up better off when they get to retirement), publicly traded companies in general -- and market index components and high-visibility companies in particular -- stand to gain from the increased market for their stocks, which should reduce their cost of raising capital, and reward their existing shareholders.

Even if most people who choose private accounts lose out, so long as the policy is in place, some people will choose to take the option, whether they should or not, so the benefit remains. And experience has shown that these types of policies can remain in place for decades even if people lose compared to the pre-existing defined benefit plans they replace.

Posted by: cmdicely | Feb 28, 2005 12:57:36 PM

brooke:

The point is that we aren't sure which scenario is best, because of the many variables. If there are two plausible scenarios that COULD lead to the successful outcome of salvaging SS, why not choose the one which will lead to more profits?

But this is about much more than that: the whole discussion is dishonest because many on Bush's side don't think the government ought to be in the job of providing pensions in old age.

Al, why don't you and the President just make the case that the country would be stronger, and we would all have greater economic freedom if we just gradually ended SS? Honor the commitment to those already in the system, pro-rating the benefits to younger workers who have paid something in, then end it? Come on Al, you can do it. Say what's on your mind.

Posted by: epistemology | Feb 28, 2005 12:58:05 PM

"Since the plan, whether or not it succeeds, does not lower payroll taxes, except that it allows workers to divert some money into private accounts from their payroll taxes, this isn't true -- whether or not the plan succeeds."

Agreed that the Bush plan doesn't explicitly lower payroll taxes on businesses in the immediate future, but as the system begins to run surpluses towards the middle of this century, it seems logical that the payroll tax burden on employers--which is an absurd tax that stifles growth and keeps unemployment artificially high--would gradually be reduced. As the system gets closer to truly being prefunded, the only thing an employer tax would be needed for is survivor and disability payments--that would take much less than 6.2% of payroll.

"The point is that we aren't sure which scenario is best, because of the many variables. If there are two plausible scenarios that COULD lead to the successful outcome of salvaging SS, why not choose the one which will lead to more profits?"

Are you saying that profits are in and of themselves bad? If two choices could be equally successful for individuals and one also creates profits for businesses, all other things being equal, the one that creates profits is bad?

Posted by: brooke | Feb 28, 2005 2:07:39 PM

Agreed that the Bush plan doesn't explicitly lower payroll taxes on businesses in the immediate future, but as the system begins to run surpluses towards the middle of this century, it seems logical that the payroll tax burden on employers--which is an absurd tax that stifles growth and keeps unemployment artificially high--would gradually be reduced. As the system gets closer to truly being prefunded, the only thing an employer tax would be needed for is survivor and disability payments--that would take much less than 6.2% of payroll.

This is so completely out of touch with reality that I don't know when to begin. For starters, the present system runs surpluses right now.

For another thing, you seem to be suggesting that business prime motivation for getting behind this has nothing to do with the much clearer short-term results but instead is all about highly speculative policies that might be implemented in uncertain conditions in the fairly distant future if it succeeds. That hardly seems credible. Particularly, since it predicts that if, some decades from now, the new policy produces inherently durable surpluses, the policy decision that will be made will be to cut payroll taxes, not to increase benefits, or retain the surpluses to ensure against future demographic bulges, or play some accounting trick to let the surpluses be used for other purposes. Given the history of government programs, that seems to be a pretty big gamble that it is highly unlikely that businesses would spend any effort pushing policy based on without some far more certain, for more short-range benefits also on the table.


Posted by: cmdicely | Feb 28, 2005 2:25:52 PM

Nor is the fact that privatizers lie, constantly, about virtually every aspect of the Social Security situation strictly relevant.

Not relevant? A consistent liar should be ignored; if you have to spend time fact-checking everything they say, why not skip the listening part and just do the research? The Bush gang has a proven track record of Big Wrong Predictions; everything from the job-creation abilities of the tax cuts, to the cost of the Iraq war, to the cost of their medicare bill. It doesn't even matter that all their errors are self-serving; they're so consistently wrong, they should not be listened to. It is guaranteed-bad information.

Posted by: dr2chase | Feb 28, 2005 9:02:01 PM

Al, talking points don't move the numbers. Privatization is all about ideology, you know it, I know it. This battle started in 1936, it will end in 2005 or 2006 with a crushing victory for FDR. Because we have the numbers and you don't. And the backlash will be devastating for Republicans. A large part of support for privatization comes from people who think "bankrupt, and flat broke" mean something like bankrupt and flat broke and not "able to pay 74% of a better benefit than retirees get today even if the economy goes into the permanent toilet required under Intermediate Cost"

You can only play out the shell game of "privatization" for so long. Because either you understand the numbers or you don't. If you do and continue to cry "crisis" you are a liar, if you don't you are by definition ignorant.

Nobody believes the economy will perform down to the levels required by Intermediate Cost, except perhaps for a few Gold Bugs here and there. And privatizers are caught on the hook of the "No economist left behind" challenge: produce an honest assessment of future economic performance that does not exceed those of Low Cost (fully funded) and yet will still return 6.5%. It can't be done and the numbers only get more stark every quarter. Every single bit of good economic news drives a new stake through the heart of privatization and that fact has to be killing ideological opponents of Social Security. Because you have a choice: admit that you hate America because you believe it will never grow faster than 2% a year in any future year. OR admit that Social Security as presently constituted is fully funded.

There are a lot of people out there that don't understand that that is in fact their choice, but I think a whole lot of people are going to be happy to know that they can embrace America and save Social Security all at the same time. America is going to grow right out of this "crisis" and in so doing vindicate FDR's position as the greatest President. And man is that going to hurt in some quarters. Too bad, so sad.

This trend in the following chart will continue unless America falls into permanent economic stagnation http://www.epinet.org/content.cfm/issueguides_socialsecurity_changes . Privatizers don't have to believe any of this, you can all go along fat, dumb and happy in all the things you "know" to be true, the shock will only be more devastating once you wake up. Sweet dreams.

Posted by: Bruce Webb | Mar 1, 2005 8:43:05 AM

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