Matthew Yglesias has some fun with the Ferrara/Sununu/Ryan plan for social security. Short version of the plan:
1) divert substantial social security tax revenues into private accounts
2) guarantee that private account + guaranteed benefits = currently promised benefits (if your account tanks, they still pay you)
3) maintain solvency of trust fund until infinity and beyond!
This is the have your cake and eat it and everyone else's too and then some free pie and here's a pony! plan.
It's quite an amazing plan, really -- I bet you're all scratching your heads wondering just how on Earth they manage to pull of this kind of magic wizardry! How could they guarantee current benefits, divert taxes, and maintain solvency until infinity and beyond without raising taxes which as we all know is impossible!
Simple, they simply mandate transfers from the general fund into the trust fund as necessary. Just like magic! As I wrote awhile back, "a way to "solve" the "problem" by acknowledging that it doesn't exist."
Of course, you can do away with the private accounts and still solve the solvency problem tomorrow by mandating the general fund transfers. In fact, the private account add-on would require much higher general fund transfers.
It's truly a batshit crazy plan, but since it promises everything for everyone...
