Bush Says US Bonds Are Worthless!

From the important and excellent There Is No Crisis, Bush Implies National Default: (I’m just going to snarf the whole thing, but go visit the site)

Mr. Bush says the Trust Fund doesn’t exist:

Some in our country think that Social Security is a trust fund — in other words, there’s a pile of money being accumulated. That’s just simply not true. The money — payroll taxes going into the Social Security are spent. They’re spent on benefits and they’re spent on government programs. There is no trust. We’re on the ultimate pay-as-you-go system — what goes in comes out. And so, starting in 2018, what’s going in — what’s coming out is greater than what’s going in. It says we’ve got a problem. And we’d better start dealing with it now. The longer we wait, the harder it is to fix the problem.

As we’ve explained previously, saying there’s no trust fund is the same thing as saying the government will default on its debt. There is a trust fund, filled with government bonds, the safest asset that has ever existed. Saying those bonds are worthless means that the full faith and credit of the US isn’t worth anything. Now what political leader would say that?

So Bush says that US bonds are worthless! In fact, the basic argument for his whole scheme is that stocks are somehow a better investment than bonds. Now, keep in mind that Bush himself has most of HIS money in government bonds, AND that he plans to finance his whole privatization sceme by selling … wait for it … here it comes … you’re going to be surprised … yes, it’s … GOVERNMENT BONDS!

And Josh Marshall weighs in:

Following up on our earlier posts about the president’s apparent desire to default on the US Treasury notes held by the Social Security Administration, two points …

First, most of President Bush’s personal wealth appears to be tied up in bonds. Do his get honored? Or is he out of luck too?

Second, what the president said today almost certainly violates his oath of office in which he swears to “preserve, protect, and defend the Constitution of the United States.”

That would be the Constitution which reads (Am.XIV, Section 4): “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”

Such statements are designed to reinforce a “narrative,” or “bigger story.” MOST people don’t pay attention to details, and “hear” only a bigger picture kind of story. In this case that bigger story is that “Social Security is going broke and we have to ‘fix’ it.” THAT is why Bush and the others feel they can get away with repeating such trash. But at what point do Bush’s lies and contradictions reach public conciousness and outweigh the “narrative”? It just might be starting to happen.