NEW DSCC AD: Senator Toomey Looks Out for Wall Street, Not Pennsylvania Seniors

V/O: When it comes to risking Social Security on the stock market, Pat Toomey wrote the book.

GFX: Pat Toomey’s Book

TOOMEY: I’ve got a whole chapter in my book where I specifically lay out how I think we should reform Social Security.

TOOMEY PROPOSED PRIVATIZING SOCIAL SECURITY

In His Book, Toomey Proposed Allowing Workers To Pay Into Personal Retirement Accounts Instead Of Social Security. “But younger workers should be given a choice. Those who would prefer to stay in the current system should be allowed to do so. If they don’t mind the lousy returns, the lack of ownership, and the risk of losing it all in the event of premature death, that’s their prerogative. Others, however, should be free to deposit a portion of the payroll taxes they already pay into a personal savings account instead of sending their hard-earned money to Washington.” [The Road to Prosperity, Pat Toomey, Page 129]

·        Chapter 6 Of Toomey’s Book Was Titled “Transforming Social Security.” [The Road to Prosperity, Pat Toomey, Page 121]

·        Pittsburgh Post-Gazette: Toomey “Devoted” A Chapter In His Book, Road To Prosperity, To Shift Retirement Funds To Private Or Personal Accounts.  “Democrats have repeatedly criticized Mr. Toomey for a statement at the Harrisburg Press Club last month in which he denied ever having advocated the ‘privatization of Social Security.’ That statement may seem at odds with Mr. Toomey’s long and outspoken advocacy of a shift from the current system to one that would allow workers to invest their own retirement funds in private or personal accounts. […] Mr. Toomey has not modified his position that such a change is essential given the projected shortfalls in the massive retirement program. In his 2008 book, ‘The Road to Prosperity,’ written with his campaign communications director Nachama Soloveichik, he devotes a chapter to his vision for the system, one that he reaffirmed in a recent interview. Mr. Toomey would retain the current system and promised benefit levels for current beneficiaries and those close to retirement.” [Pittsburgh Post-Gazette, 9/6/10]

Scranton Times-Tribune: Toomey Defended His Proposal To Change Social Security “With A Form Of Privatization.”  “Republican U.S. Senate candidate Pat Toomey defended his proposal Thursday to ensure Social Security’s future with a form of privatization and accused Democrat Joe Sestak of distorting his position. […] Mr. Toomey would allow younger workers to voluntarily divert a portion of their Social Security pay-roll tax into private savings accounts they would control and invest any way they want. A young worker who did not want to do that could stay with the current system of a guaranteed benefit. ‘Over the course of 45 years or so, the accumulated savings from putting a little bit of money away every week or every month for 45 years would add up to a very significant nest egg, and that could form the basis of a very significant portion of their retirement,’ he said.” [Scranton Times-Tribune, 10/8/10]

Pittsburgh Post-Gazette Editorial: “Then, As Now, [Toomey] Supported Privatizing Parts Of Social Security.” “In October 2010, the Pittsburgh Post-Gazette Editorial board wrote “Pennsylvanians are not likely to find a more high-contrast choice Nov. 2 than in the race for U.S. Senate. Republican Pat Toomey and Democrat Joe Sestak are vying for the seat held by Arlen Specter for the last 30 years. […] In 1998 he won a seat in the U.S. House and served for three terms. Then, as now, he supported privatizing parts of Social Security, a flat income tax of 17 percent and corporate taxes that are as low as possible. He believes the new health insurance law should be repealed and replaced by a modest program of tort reform, competition among insurance companies and health savings accounts in which families would set aside tax-deductible dollars to pay for their insurance.” [Pittsburgh Post-Gazette, Editorial, 10/17/10]

TOOMEY SAID HE HAD “A WHOLE CHAPTER” IN HIS BOOK ON REFORMING SOCIAL SECURITY

Toomey Said “I’ve Got A Whole Chapter In My Book Where I Specifically Lay Out How I Think We Should Reform Social Security.” JOE SCARBOROUGH: “What about — we have to check off the list here, baby, do you support the Civil Rights Act of 1965?” PAT TOOMEY: Yes, do.” […] SCARBOROUGH: Ok, Social Security, Medicare, Medicaid, do you support it?” TOOMEY: I support them. I think we need to fix them.” SCARBOROUGH: “Are we going to have to raise [cross talk] Are we gonna have to raise the age of Social Security? Everybody knows that. I’m just going to ask you as a politician running in the heat of a political battle, will you now say that for people 55 and younger we have to raise 65 to, say, 70?” TOOMEY: “I’ve got a whole chapter in my book where I specifically lay out how I think we should reform Social Security.” [MSNBC, Morning Joe, 5/26/10]

V/O: Toomey’s plan requires Wall Street and bankers to manage the accounts.

GFX: Toomey’s Plan

Wall Street

Would Manage

Social Security

TOOMEY SAID HIS SOCIAL SECURITY PLAN WOULD REQUIRE PRIVATE ACCOUNTS TO BE PROFESSIONALLY MANAGED

Times-Tribune: Toomey Said He Would Require The Private Social Security Accounts To Be Professionally Managed. “Republican U.S. Senate candidate Pat Toomey defended his proposal Thursday to ensure Social Security’s future with a form of privatization and accused Democrat Joe Sestak of distorting his position. […] Mr. Toomey said he would require the private accounts to be professionally managed with diversified investments to minimize the risk. The money would be shifted to less risky investments as a person approaches retirement age. ‘I would argue that you don’t really have to worry about a fluctuation in the stock market because this is a 45-year period of time, and you are gradually transitioning out of stocks as you get older and get closer to the point where you need to draw on those funds,’ he said.” [Scranton Times-Tribune, 10/8/10]

York Daily Record Editorial: Toomey “Seems Far More Allied With The Wall Streeters” And “Wants To Put Social Security In The Hands Of His Former Colleagues.” “He’s not even gone yet, and we already sort of miss Arlen Specter. Yes, he’s a slippery fish, a ‘typical politician’ whose main allegiance seemed often to himself. But he was truly a moderate representing a moderate state. He drove his party leaders (on both sides of the aisle) crazy with his centrist voting record. […] You might think Mr. Toomey would be that guy. He is the Republican, after all. But he’s even more partisan and extreme than former Sen. Rick Santorum, who became a kind of ultra-conservative caricature until finally being unseated by the moderate Bob Casey Jr. Pat Toomey seems far more allied with the Wall Streeters, whose greed and irresponsibility helped wreck our economy, than with Main Street business people and small town citizens. He wants to put Social Security in the hands of his former colleagues in the old derivatives dice game. He’s actively worked to purge centrist Republicans from the GOP during his time with the Club for Growth. He’s even a global warming denier, for goodness sake. You don’t need to read between the lines on his furrowed brow. His intention to make a wrenching, hard-right turn is evident.” [York Daily Record, Editorial, 10/26/10]

·        Toomey Worked On Wall Street From 1984-1990. “Toomey worked on Wall Street from 1984 to 1990 for Chemical Bank and Morgan Grenfell.” [PolitiFact Pennsylvania, 5/31/16]

·        Pittsburgh Post-Gazette: “Toomey Earned the Bulk of His Wealth As A Trader On Wall Street.”  “Mr. Toomey earned the bulk of his wealth as a trader on Wall Street and, briefly, in Hong Kong. After six years in Congress, he served as president of the Club for Growth, an anti-tax group backed by the financial industry.” [Pittsburgh Post-Gazette, 10/15/10]

V/O: Collecting fees out of your Social Security that could total billions.

GFX: Fees

That You Pay

V/O: Fees they collect, even if the market crashes and seniors lose everything.

GFX: Fees

Even If You Lose Everything

V/O: Pat Toomey’s looking out for Wall Street, not Pennsylvania

GFX: Pat Toomey

Looking out for Wall St.

Not Pennsylvania

PRIVATIZATION OF SOCIAL SECURITY WOULD PUT HUNDREDS OF BILLIONS OF DOLLARS IN THE POCKETS OF WALL STREET IN FEES FROM INDIVIDUAL ACCOUNT BALANCES

Los Angeles Times: University Of Chicago Study Said Social Security Privatization “Could Generate Fees For The Financial Industry Worth $940 Billion.” “The issue of Wall Street fees has become a hot button for groups on both sides of the debate. Financial companies betray ‘an enormous conflict of interest’ if they support private accounts, said Bill Patterson, director of investments at the AFL-CIO. ‘This is driven by fees.’ Financial companies betray ‘an enormous conflict of interest’ if they support private accounts, said Bill Patterson, director of investments at the AFL-CIO. ‘This is driven by fees. ‘A study last year by University of Chicago economics professor Austan Goolsbee asserted that the accounts could generate fees for the financial industry worth $940 billion, in current dollars, over 75 years.” [Los Angeles Times, 1/18/05]

Securities Industry Association Said Wall Street Would Make As Much As $279 Billion In Fees From Social Security Privatization. “No one knows whether workers would prosper in private Social Security accounts, but financial firms would likely pull in big bucks… The Securities Industry Association calculated that the plan would generate at most $279 billion in fees, or about 8.6 percent of the $3.3 trillion in the financial sector’s total revenues, over 75 years.” [Newsday, 2/20/05]

NCPSSM: Privatization Of Social Security Would Lead To “Wall Street Brokers And Fund Managers […] To Make Billions Of Dollars Of Year.” “Right now, Social Security provides a guaranteed income, paying benefits every month for life, with increases for inflation. After adjusting for risk, Social Security has a rate of return equal to that of any mix of financial assets in private accounts. […] Wall Street brokers and fund managers would stand to make billions of dollars a year thanks to privatization, so it’s no surprise that they strongly support the privatization movement!” [National Committee to Preserve Social Security & Medicare, Accessed 6/11/16]

·        NCPSSM: Under Privatized Social Security, “Commissions And Fees Could Easily Burn Up As Much As 15 Cents Out Of Every Dollar Of A Workers Annual Investment.” “Administrative costs for Social Security are very low – less than 1% of the program’s budget. Diverting money to the stock market would incur the very high costs of brokers’ commissions, mutual fund management fees, and other expenses inherent in buying and selling stocks and bonds. Small investment accounts are very expensive to administer. Commissions and fees could easily burn up as much as 15 cents out of every dollar of a worker’s annual investment as they do in some countries with privatized systems.” [National Center to Preserve Social Security and Medicare, Accessed 8/11/16]

The Century Foundation: Wall Street Brokers, Banks, And Mutual Funds Would Gain “Enormous Fees” Under Private Social Security Accounts, Where The Fees Would Come From “The Balances From The Individual Accounts.” “Brokerage houses, banks, and mutual funds have been very active in the campaign to privatize Social Security. Small wonder, since they stand to gain enormous fees if billions of dollars are shifted each year from Social Security payments into accounts under Wall Street management. Of course, those fees must come from somewhere, namely from the balances in individual accounts.” [The Century Foundation, 12/14/04]

York Daily Record Editorial: “He [Toomey] Wants To Put Social Security In The Hands Of His Former Colleagues In The Old Derivatives Dice Game.” “He’s not even gone yet, and we already sort of miss Arlen Specter. Yes, he’s a slippery fish, a ‘typical politician’ whose main allegiance seemed often to himself. But he was truly a moderate representing a moderate state. He drove his party leaders (on both sides of the aisle) crazy with his centrist voting record. […] You might think Mr. Toomey would be that guy. He is the Republican, after all. But he’s even more partisan and extreme than former Sen. Rick Santorum, who became a kind of ultra-conservative caricature until finally being unseated by the moderate Bob Casey Jr. Pat Toomey seems far more allied with the Wall Streeters, whose greed and irresponsibility helped wreck our economy, than with Main Street business people and small town citizens. He wants to put Social Security in the hands of his former colleagues in the old derivatives dice game. He’s actively worked to purge centrist Republicans from the GOP during his time with the Club for Growth. He’s even a global warming denier, for goodness sake. You don’t need to read between the lines on his furrowed brow. His intention to make a wrenching, hard-right turn is evident.” [York Daily Record, Editorial, 10/26/10]

Investment Operating Fees Are Assessed Regardless Of Performance. “Mutual funds provide investors with professional management, but it comes at a cost. Funds will typically have a range of different fees that reduce the overall payout. In mutual funds, the fees are classified into two categories: shareholder fees and annual operating fees. The shareholder fees, in the forms of loads and redemption fees, are paid directly by shareholders purchasing or selling the funds. The annual fund operating fees are charged as an annual percentage – usually ranging from 1-3%. These fees are assessed to mutual fund investors regardless of the performance of the fund. As you can imagine, in years when the fund doesn’t make money, these fees only magnify losses.” [Investopedia, Accessed 8/8/16]

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