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Taibbi writes: "So now that Wall Street has ripped off this segment of society three times, it makes all the sense in the world that Mitt Romney - a former Wall Street superstar who was a chief architect of the modern executive-compensation-driven corporation - is coming back and telling us that we need to cut their Medicare and Social Security benefits in order to defray the cost of the previous three scams. (Actually, it makes sense. If we don't cut health care and retirement benefits for old people, how can we pay for the carried-interest tax break that allows private equity guys like, well, Mitt Romney to keep paying 15 percent tax rates?)"

Matt Taibbi at Skylight Studio in New York, 10/27/10. (photo: Neilson Barnard/Getty Images)
Matt Taibbi at Skylight Studio in New York, 10/27/10. (photo: Neilson Barnard/Getty Images)

Mitt Romney's Entitlement Plan Is Crazy

By Matt Taibbi, Rolling Stone

08 November 11


avid Brooks, the [gratuitous insult deleted], wrote this this morning entitled "Mitt Romney, the Serious One." In it, he explained how Romney's recent decision to unveil a plan for reforming the entitlement system "demonstrates his awareness of the issues that need to define the 2012 presidential election."

Romney grasped the toughest issue - how to reform entitlements to avoid a fiscal catastrophe - and he sketched out a sophisticated way to address it.

So we had a giant financial crash in 2008 that necessitated a bailout costing a minimum of nearly $5 trillion and perhaps ultimately costing $10 trillion more, we have foreclosure crisis with more than million people a year losing their homes, and we have a burgeoning European debt disaster that threatens to devastate the global financial system - and the chief issue facing the country, according to Brooks and the Times, is reforming the entitlement system?

The column goes on to throw bouquets on Romney's plan to semi-privatize Medicare and Social Security. Romney's ideas are not as draconian as Paul Ryan's, but they do pave the way for Wall Street's ultimate goal - full privatization of Social Security and Medicare.

Think about what such reforms might mean. Your typical Medicare/Social Security recipient might already have been ripped off three different ways in this era.

He might have been sold a crappy mortgage or a refi by a Countrywide-type firm (which often targeted the elderly). He might then also have unwittingly become an investor in such mortgages and seen the value of his retirement holdings devastated (many of the banks sold their crappy mortgage-backed securities to state pension funds).

Lastly, if he paid taxes, he saw part of his tax money go to pay off the bets the banks made against these same mortgages.

So now that Wall Street has ripped off this segment of society three times, it makes all the sense in the world that Mitt Romney - a former Wall Street superstar who was a chief architect of the modern executive-compensation-driven corporation - is coming back and telling us that we need to cut their Medicare and Social Security benefits in order to defray the cost of the previous three scams.

(Actually, it makes sense. If we don't cut health care and retirement benefits for old people, how can we pay for the carried-interest tax break that allows private equity guys like, well, Mitt Romney to keep paying 15 percent tax rates?).

There's another aspect to all of this that boggles the mind.

We've just witnessed an episode of industry-wide financial mismanagement that surely has no parallel in history. From Lehman Brothers to AIG to Goldman and Morgan Stanley (which in 2008 needed the unprecedented emergency granting of a commercial bank charter to avoid bankruptcy) to Citigroup (which needed a $25 billion bailout and $300 billion in federal guarantees to survive) to Bear Stearns (dead) and Merrill Lynch (dead) and so on, virtually every single one of America's leading financial institutions from the last decade is either already out of business or functionally insolvent and living off government life support and cheap cash from the Fed.

Even leaving aside the fact that most of them are facing mass litigation for fraud, dishonest accounting, and/or systematic perjury (for robosigning financial documentation), they've all proven their complete and utter incompetence to do their ostensible jobs, i.e. the care and stewardship of money.

For instance, the top five investment banks in the country sought to remove capital requirements in the middle of the last decade, and all of them instantly jacked their debt-to-equity ratios above 20-1, some of them going as high as 33-1 or 35-1. Of those five investment banks, three (Bear, Lehman, and Merrill) went out of business during the crash, and the other two (Goldman and Morgan Stanley) required massive government aid to survive.

The commercial banks have not been much better, with two of the biggest (Wachovia and Washington Mutual) imploding thanks to bad investment decisions and three of the biggest survivors (Bank of America, Wells Fargo, and Citigroup) recently facing downgrades.

The recent downgrades, incidentally, were widely seen as Wall Street's way of making two interlocking judgments about these big banks. One is that their accounting is so fucked up and dishonest that it simply cannot be believed, leading to widespread expectation that one or more of them will ultimately collapse. The other is that when they collapse, the government may no longer be able or willing to completely bail these companies out. The downgrades were spurred by vague fears that implementation of new reforms via Dodd-Frank will make it harder to get bailouts.

So the mere hint that these banks might be denied future bailouts caused a company as massive as Bank of America to be downgraded to just above junk status. That means, in other words, that without the implicit promise of government aid, Wall Street considers these banks to be junk or below-junk businesses. Evaluated purely on their own merits, without the implicit attachment to the taxpayer, these companies actually have negative trustworthiness.

And these are the people we want managing the nation's Social Security accounts?

If there wasn't such a very real chance that this could happen, it would be worth laughing about, but unfortunately it's no joke. It's a testament to the tenacious idiocy of our national media that an idea like Social Security privatization could continue to be publicly contemplated, in the wake of a disaster on the scale we've just gone through.

Advocating the turning over of Social Security management to Wall Street after the 2008 crash is a little like asking Paris Hilton to pilot Air Force One, or tabbing Charlie Sheen to manage the inventory of a hospital pharmacy - completely nuts, but to David Brooks, that makes Mitt Romney the "serious" candidate. your social media marketing partner


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+102 # Barbara K 2011-11-08 15:27
Not only is Romney's plan crazy, he's an idiot. First of all, these programs are NOT ENTITLEMENTS, they are EARNED, we've paid into them for years before drawing on them. The wealthy are so stupid that they don't know the difference. They cannot connect to ordinary, middle class, poor Americans, who have the power to vote, by the way.

+70 # in deo veritas 2011-11-08 17:11
The only entitlements I see are what members of Congress get for representing the 1% instead of the American people. They are out of touch with reality and when they fall it will be very very hard. Hopefully lots of them will do hard time-well deserved. Both sides of the aisle are deserving of this.
+10 # macduff40 2011-11-08 22:48
Never vote republican Hell, vote 3rd party.
+13 # maddave 2011-11-09 08:28
That's right, macduff - vote for a third party and help elect one of the GOP's mental midgets a president. Do you really want that? Remamber that we have Ralph Nader to thank for George Bush and the ten years war and the financial crisis that he brought us. THINK!

Obama may have been a vast disappointment to date, but he seems to be developing some gonads and taking OUR fight back to the greedy fat cats who want nothing more from American Workers - the quickly disappearing Middle Class - than to privatize and then rape our- repeat: OUR - Social Security & Medicare.

NO! NO F*****G GOP & NO F*****G third party. Vote YOUR pocketbook for a change. THINK!
0 # jky1291 2011-11-10 00:39
I'm sorry but if the Obama supporters want to split the progressive vote and give the White House to the Republican terrorists that is on them, because there are enough Independents who will not vote for Obama, as well as disenchanted Democrats that he has zero chance of being reelected. But, a true Progressive could enjoy a landslide victory, by leveraging the 80% and growing dissatisfaction with Congress. While I will never vote for another Republican as long as I live, the tax reduction extension welfare entitlement bailout for millionaires and billionaires, following the health care capitulation, forfeited my support for President Obama. It is one thing if one does not know what is right, but it is inexcusable when one knows what is right and still refuses to uphold those principles. It is essential that a candidate that genuinely supports and will fight for the fundamental issues presented in the Rebuild the American Dream movement is identified, recruited, and elected as a 3rd party President to wrestle our country out of the death grip of the multinational corporations.

If President Obama wished to run in 2016, I would wish him well, hoping he had learned what is required to truly represent all of the citizens of this nation, not just the wealthy 2%.
+7 # Observer 47 2011-11-09 11:00
If the wealthy are so stupid, then why are the 99% in such bad shape? Wake up! The framing of "entitlements" is a conservative strategy to hoodwink the Rethug base into supporting all the thievery that the wealthy have planned and carried out. It's not stupidity, it's very effective propaganda, designed by masters of the game.

Also wake up to the fact that it doesn't matter whether you vote for Republicans or Democrats; the people in charge decide who gets in office, regardless of the vote tallies. For reference, see: Ohio, 2004. Tactic #1 is to get all the uninformed to vote against their own interests. If not enough of them do that to get the chosen ones into office, Tactic #2, rigging the elections and altering results, is employed. Either way, the 99% doesn't choose who's running our country. At this point in our history, it's naive to think that our votes really count. Further, Democrats take as many hand-outs from the wealthy and the corporatocracy as Republicans, so the only effective solution is to engineer a total house-cleaning in the government. Get ALL the corrupt office-holders out, no matter what party they belong to.
+37 # BobbyLip 2011-11-08 15:30
Yeah, but Michael Jackson's doctor was hauled out of the courtroom in handcuffs, and Lindsay Lohan spent almost five hours in the slam. I'd say Law Enforcement is taking care of business, and the Media is keeping the public informed. In God We Trust, baby!
-25 # in deo veritas 2011-11-08 17:12
There is no one else but God that you can trust.
+82 # Nell H 2011-11-08 15:45
"To a carpenter, every tool is a hammer."

Romney is a product of Wall Street money. Why would anybody think he would support Social Security or Medicare or anything else but Wall Street?

Let's talk about raising the 15% maximum tax on capital gains. We can no longer afford this giveaway to the rich.
+26 # soularddave 2011-11-08 23:09
Chill out on the carpenter talk; I am one, and we use screw guns now.

Romney is also part of something else that make their belief system *entitle* them to being rich on the backs of "regular" folks.

How about 28% on capital gains above ½ million - AND - a "transaction" tax of, say ¼% of each trade.

Oh, and do away with MERS and just follow the laws in place.
+49 # jwb110 2011-11-08 16:46
The only nut case bigger than Romney in Brooks. I clearly remember his statement about the "Bush the 2nd " Cabinet and its members. "At least the people who own the country will now be running it."
Wanna fix entitlements, Mr. Brooks? First stop lying thru your teeth. Second, stop providing entitlements for crooked businesses paid for by taxes those same crooks don't pay. The taxes belong to the people who PAY the taxes, not corporations who seem to be exempt from paying taxes.

Matt Taibbi is the best!
+64 # wrodwell 2011-11-08 17:16
The largest "entitlement" programs in the country are Golden Parachutes, CEO compensation, Government bailouts for banks and the Bush tax cuts which, together with the two bogus foreign wars, are what's really wrecking the economy. It's about time the American people woke up to the snake oil medicine pushed by Republicans. It always astonishes me how so many can fall so often for the deceptions of the diabolically clever few. I guess Karl Rove was right when he said that his greatest enemies are the politically and socially educated. If Americans don't smarten up soon we'll become the world's largest third world country, resembling a banana republic run by mega-rich Top Bananas. Everyone else will be nothing more than canon fodder for future wars and dutiful consumers at Wal Mart stores. We're on an unparalleled path to committing assisted suicide.
+20 # soularddave 2011-11-08 23:14
Quoting wrodwell:
The largest "entitlement" programs in the country are Golden Parachutes....

Let's not forget that every tinhorn yahoo that gets elected to Congress by the TPers and the Koch brothers gets lifetime retirement benefits... Just for hanging in there long enough to say "NO!" to every bit of good legislation. Just to make the President look bad.
+4 # maddave 2011-11-09 08:41
Sorry,Ol Buddy, but this "lifetime compensation" gig is a myth. Check "Congressional Compensation" at SNOPES. And, yes, congressmen also pay payroll tax for Social Security & Medicare.

When we have so much truth to smear them with, we don't need to resort to myths and rumors.
+2 # jky1291 2011-11-10 00:44
It would be optimistic to assume 4th world status, now.
+37 # Vardoz 2011-11-08 17:26
I am sure Mitt is on board with the everything should be put on the table line. Most of all our entitlements - There's this popular phrase going around congress and the senate and the so called Super Committee.


But everyting should NOT BE ON THE TABLE.

There needs to be a moral criteria added to the conversation.







Everything should not be put on the table when the military is getting a blank check to the tune of billions per week, when the top 1% are getting gigantic tax cuts and when the richest corporations in history aren't paying taxes.

There are 3 pillars that allow societies to survive and those are protections, accountability and regulations that protect the majority of the people of the nation.
+4 # jon 2011-11-08 22:57
+2 # RLF 2011-11-09 06:40
These austerity programs and suggested 'entitlement' changes are but another bailout for the banks that loaned too much money to an entity that could not pay and should default...the US gov. should default...give the Repugs what they say they want...and then start over with some control over these pricks. It worked for Brazil!
+7 # Regina 2011-11-08 18:01
There is a crisis in national arithmetic. There is now a special population of equity elitists for whom 2 + 2 always = at least 5, and super elitists who get 2 + 2 = lucky 7, since they play in the diceyest games. Teachers don't seem to know this, since they never see it, so ordinary folks keep grinding away with 2 + 2 = 4, as they learned it -- although it may erode down to 3.5, or even less. We need to rescue arithmetic from this instability.
+4 # macduff40 2011-11-08 22:55
Speaking of arithmetic: those entitlements are our own money, we get back on average less than we pay in, How;s dem apples?

if the wapo article is correct, then average social security checks should be much larger. gee, I don't know, perhaps high enough to raise recipients out of poverty level income levels.
+31 # Kayjay 2011-11-08 18:17
I agree with Matt that our national media has atrophied into a band of liked-minded idiots. And so Brooks is merely making his hay and a few bucks by penning propaganda for his corporate bosses. Up on the Hill, Romney isn't crazy, just sly like a fox. Sadly, he tosses these ideas out there and the right-wing people or sheeple fall right in line. Can you imagine the dire consequences of a privatized medicare system? Let's say Mr. Smith's medicare managed by Wall Street bumblers, gets wiped out after a greedy scheme goes south. What happens to Mr. Smith then. Well, in Romney's world.... it's tooooo bad for you, cause I've got mine. is this the kind of world we wanna live in? More of us need to say NO to Romney and the nonsense spewed by Brooks!
+9 # KittatinyHawk 2011-11-08 18:35
Mitt is nuts, unfit to Lead.

Until we start getting some good candidates we have no Leaders in 2012 Elections.

Hope you all voted today and are working to get people out in 2012
+27 # Billsy 2011-11-08 19:13
Many of us were already ripped off by Wall St. when we established our personal 401K or IRA retirement accounts. Mine is worth today 1/2 what it was in 1998. Of course, Wall St. would love to get their grubby hands on all that social security $$$. I've already learned my lesson and wouldn't trust today's financiers any farther than I could throw a concert grand piano. Amazed at how many foolish citizens cling to their outmoded affection for the status-quo.
+1 # RLF 2011-11-09 06:43
Wall st. is playing with fire when they fight reform. When the world decides that they are not trust worthy and take their investments elsewhere. They figure it can't happen because Emarica is grrrreat!
+5 # reiverpacific 2011-11-08 19:28
Quoting in deo veritas:
There is no one else but God that you can trust.

Possibly -but it's other people who claim to know God's will and be doing his work that you have to watch for!
Romney is a Mormon -I'm not saying that they're all bad or nuts but it is a weird Religion from beginning to present with origins even shakier, more comparatively recent and fantasy-based than most, has a tendency to encourage it's male adherents to seek power and influence, be extremely conservative, breed like rabbits, send young "Missionaries" all over the worlds to seek converts, practices a kind of "Socialism of the Faithful" with all members obligated to give a 10% mandatory tithe -might as well call it a Church Tax- and thereby is extremely wealthy.
There is more -but do you want somebody as President who bust be default, deeply conflicted between church and national interest -especially at the Grassroots.
Of course Harry ("super-committ ee") Reid is also a (converted) Mormon but has at least pledged to fight for Social Security. I doubt that Romney even knows what this is!
+6 # RLF 2011-11-09 06:44
All religions are weird when people lose their perspective on them. They are all a tool and often the tool is a crutch.
+20 # lin96 2011-11-08 19:39
What right do they have to put Social Security and Medicare "on the table"? The money in it belongs to the people and they have a right to vote on what happens to it. In fact, the Congress should have to repay the fund for all the times they raped it. Mitt Romney was born with a silver spoon in this mouth and all he's done is replace that spoon with his foot. What a slug!
+21 # Aussieken 2011-11-08 20:34
What ever happened to common sense 101? It stands to reason that anything that is privatised has a new layer of people inserted into the process and they are named shareholders. The shareholders want profit and so their hands are always out.A new CEO of Social Security no doubt will also be paid millions. (You have to pay the big bucks of course to attract the right person. You know - some mate of the Republicans.)
+11 # panamericans 2011-11-08 23:48
The trouble with this Country is there are not enough 'Matt Taibbi's.

Could you imagine if the President had the focus and drive of a Matt Taibbi?.... Oh, I can hear Congress moan and groan already, as they empty their pockets of perks and coin.

Please,no'special committees' whose sole purpose is to excuse the banks of their felonies.

Since when do politicians have it in their 'divine power' to excuse gross crimes on the public? Who is paying for whom here?

Why does such financial 'forgiveness' apply to the banks and not to the rest of us?

Why should home owners pay and lose their homes,because of the massive frauds committed by the banks?

Actually, where are the Matt Taibbi's in US politics?

Why do we have to suffer the likes of the current party offerings? It is 'business as usual', no matter who wins. Even Blind Freddy and his dog can see this one coming in 2012.

No wonder the 1% hold the rest of us in contempt. They make us dumb and dumber under their muscular media thumbs.

Of course it is also true...

'He who holds the Gold makes the rules'. This has to stop...includin g the cancerous growth of Goldman Sacks and their fellow banking tumors.

I am not hopeful...this country is a democracy in name only...unless?
+1 # jky1291 2011-11-10 00:54
The choice between the unacceptable and the unelectable leaves us with only a potentially viable 3rd Party Presidential candidate to receive the votes of every intelligent voter demanding salvation of our nation.
+5 # kitster 2011-11-08 23:53
the mittster is a former kkr wannabe, a proponent of the slash for cash policy of buying companies, splitting them up and selling the parts off for a nice return. all the while cutting staff, of course. he's a greedster of the first degree. just hearing about one of his plans to eviscerate the economy makes me want to grab my genitals for fear of losing them.
+5 # Joe Bob 2011-11-09 01:14
Matt Taibbi is an excellent journalist
+1 # gentle 2011-11-09 07:10
I'm not voting for for Mitt because he is a Mormon. That idea is absurd and BTW not fair and balanced at all. I'm not voting for him because he's a 1% wanna be, a Koch s**ker.
+7 # mwd870 2011-11-09 07:28
We are lucky there are so many articulate writers who can explain the enormity of the financial crimes committed since 2008. If only there were more ordinary people who understood the repercussions of what is happening. There was a very nice cable guy at my house yesterday (really) who talked like every right-winger I've ever met. How do we change the minds of these people? This is beginning to be my greatest worry, as the truth is already out there.
+2 # mwd870 2011-11-09 07:34
Oh yeah, Mitt (or Willard as Rev. Sharpton calls him) is an idiot. Another year of listening to the ditherings of the Republican candidates could drive me to pull my hair out.
+3 # panhead49 2011-11-09 10:09
Great article - per your usual standards Mr. Taibbi. But I'd sure love to know what you called him - "David Brooks, the [gratuitous insult deleted],...." Must be pretty good - the f bomb was left in the article ;)
+1 # pernsey 2011-11-12 00:35
Just remember GOP stands for Greedy One Percent!

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