Social Security Sanity

Gail Collins at the New York Times writes a great editorial today on the Social Security Crisis, such as it is.

Contrary to Mr. Bush's frequent assertion that Social Security is constantly imperiled by political meddling, it has in fact been preserved and improved by political intervention throughout its 70-year history, most significantly in 1983. The system could - and should - be strengthened again by a modest package of benefit cuts and tax increases phased in over decades.

Instead, the administration wants workers to divert some of the payroll taxes that currently pay for Social Security into private investment accounts, in exchange for a much-reduced government benefit. To replace the taxes it would otherwise have collected - money it needs to pay benefits to current and near retirees - the government would borrow an estimated $2 trillion over the next 10 years or so and even more thereafter.

In effect, the administration's plan would get rid of the financial burden of Social Security by getting rid of Social Security. The plan shifts the financial risk of growing old onto each individual and off of the government - where it is dispersed among a very large population, as with any sensible insurance policy. In a privatized system, you may do fine, but your fellow retirees may not, or vice versa.

It will be interesting to see how this debate shapes up. I think the Democrats can do very well, if they play their cards right. If the American People really understand the point to President Bush's thee card monty, they will assuredly reject it. But if he can keep up the fear and the promise of enormous wealth down the road, they might never pick up on the real score.

In other words, you can expect me to continue focusing on this issue.