Robert Reich on Bush’s “Ownership Society” myth:
The Republican rhetoric assumes most Americans can save and invest. The reality is, most Americans are deep in debt. Before they can join the “Ownership Society” they’ve got to pay their credit card bills, their rising variable-rate mortgages, and their auto loans. After that, there’s no money left because jobs are in short supply and wages are stuck in the mud. The Commerce Department reported this week that personal incomes rose a measily one-tenth of one percent in July, the lowest rise in almost two years. And — given rising prices for food, fuel, and health insurance — consumers spent more than they earned. So last month, Americans went even deeper into debt. The result: Less ownership, not more.
It’s true that more than half of American households now own stocks in corporations. But for most, it’s just a few thousand dollars worth. And the total value of their current portfolio is less than they invested. They got lured into the stock market during the late 90s when stock prices were pumped up with accounting steroids. The fact is, an Ownership Society based on the stock market would be a casino. The Bush administration would like you to put your Social Security payments into the stock market, but beware. If your timing is bad, you could find yourself retiring in a bear market. It’s happened before. That’s one of the reasons Social Security — as social insurance — was invented.