HILL OF BEANS: Right Said Fed

Last week, while the impeachment hearings were degenerating into utter confusion, the President was traveling around the country peddling the policy initiatives in his State of the Union address. As he did, Alan Greenspan was traveling around trying to undo them. In particular, the Fed chair sought to save Social Security from the President's efforts to "save" it. Greenspan noted that in order to fully fund the program, we'd have to raise taxes 4 to 5 percent of total payroll. Other than that, our only immediate option is to increase immigration. (Although I don't recall the President mentioning that in his State of the Union.)What really came in for Greenspan's wrath were Clinton's "U.S.A. Accounts," under which he hopes to "privatize" part of the Social Security system. This was supposed to be boob-bait for free-marketeers, and Republicans have swallowed it hook, line and sinker. Of course, these aren't really "accounts" and there's nothing really "private" about them: The government picks a few lucky companies and consortia and buys their stock with hundreds of billions in taxpayer funds, instead of sticking that money into T-bills. If you know Clinton, you know where this is heading.Greenspan, who probably felt the thumbscrews before he was re-upped as Fed chair, said: "Even with Herculean efforts, I doubt if it would be feasible to insulate, over the long run, the trust funds from political pressures, direct and indirect, to allocate capital to less than its most productive use." Translate this hedging out of Fed-chairmanese, and what you get is this: "Investing in Social Security" is going to mean investing in the companies that have ladled the most dough into the President's campaign coffers.The untutorable and always-chipper presidential press spokesman Joe Lockhart called Greenspan's speech a "very important validation" of the President's program.

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