Faith, social security again, and more about the reality-based community

Mark Weisbrot (among others. For an example of a less well-known but thoughtful analyst, see Boonton's posts on Social Security.) points out that

According to the Social Security Trustees' own numbers -- which President Bush is also using -- the program can pay all promised benefits for the next 38 years, without any changes at all. And even after that it would still pay a larger real (inflation-adjusted) benefit than people receive today -- indefinitely.

Why is that the case if the social security trust fund will run out in about 38 years? The answer is that at that time, payments will have to be reduced to income, which will be about 80% of what the payments would otherwise be. So why is 80% better than what people are getting now? I was confused about that for a while.

The answer I believe is that social security benefits are linked to incomes, not to prices. Most models of the economy project incomes to rise faster than prices. So by 2042 (and thereafter), 80% of the 2042 benefits will be a better deal with respect to projected 2042 prices than 100% of today's benefits are with respect to today's prices.

Faith-based policy
But none of this really matters. The Bush administration (and apparently much of the country) is not part of the reality-based community. I keep forgetting. Foolish me.

Do you recall that during the 2000 Presidential campaign, Bush was accused of fuzzy math? He was claiming that his then proposed tax cuts would not produce a deficit. Of course he was wrong — and even then, it was clear that his arithmetic was incorrect. But it didn't matter. Even before he became President, Bush was creating his own reality. Isn't that the essense of a good con: sell faith and then get people to do what you want?

Karl Rove learned a terrible lesson from that success: reality doesn't matter. If one has as a major part of one's base people who have a faith-based view of the world rather than a reality-based view, you can sell them anything as long as they have faith in you. Is that the key? Is Bush selling thinly (or not so thinly) disguised faith to enough people that he gets his way?

One of the features that has set the Western world apart from, for example, the modern Muslim world, is our reality-based view in contrast to their faith-based view of the world. It appears that the leading country in the western world is moving backwards: away from a reality-based view of the world and back toward a faith-based view of the world. Perhaps Europe and the Far East won't succumb. But is the United States about to sink back into a dark ages ruled by faith over reality? If so, the terrorists will have won, and bin Laden can rejoice in his victory.