Expect Social Security cuts

CNN reports Greenspan tells Congress that cuts in future retirement benefits are all but inevitable.

The Fed chairman told the Senate Special Committee on Aging that the nation has about three years to work out a fix. "In 2008, the leading edge of what must surely be the largest shift from retirement in our nation's history will become evident as some baby boomers become eligible for Social Security," he said in his prepared remarks.

By that date, the population 65 years and older will be more than one-fourth of the adult U.S. population, Greenspan said, referring to forecasts by the Social Security trustees. That would be up from 17 percent currently.

"This huge change in the structure of our population will expose all our financial retirement systems to severe stress and will require adjustments for which there are no historical precedents," he said.....

Greenspan also repeated his support for some kind of private investment accounts. The main reason he gave is that putting part of people's retirement taxes in a private account would be like putting them in a "lock-box" so that the funds could not be diverted into spending on other government programs.

The Left Coaster blog comments Hmm...is it any coincidence that, right when support for Social Security privatization appears headed for a free-fall, Federal Reserve Chairman and moonlighting Republican hatchet-man Alan Greenspan feels compelled to ramp up the doomsday talk? Congressional committees keep asking him the same question, and he gives the same answer. Why is that such a surprise to the Left? Sure ya did, you double-dealing little cretin. I think the blogosphere will have a gay ole' time trashing Greenspan's much-cherished "legacy" between now and his blessed retirement. Let the festivities begin. You know the Left knows they are doomed when all they can come up with is an ad hominem attack.

James Joyner notes Pollster John Zogby, a Democrat, argues that President Bush's plan to reform Social Security will likely fail but that it's nonetheless shrewd politics.

The president's real prize would be a significant realignment in party politics. It has been no secret that Mr. Bush and Karl Rove have their sights set on a political realignment not experienced since FDR built a coalition of urban ethnics, liberal ideologues and Southern conservatives under the Democrats' big tent. Like the New Deal, the president's "ownership society" is a compelling new vision and veritable redefinition of a society less dependent on government largess, of a middle class more independent and more capable of securing financial security on its own.

Tyler Cowen says Max Sawicky and I square off on taxes and spending, here is the link. Sawicky says impossible, Greenspan says inevitable.