The weakest widely used argument against Social Security reform is the one about the stock market being too risky to trust retirement funds. Government employees exempted from Social Security routinely have pensions invested in the market. House Democratic Whip Steny Hoyer talked to The Wall Street Journal recently-
The No. 2 Democrat in the House said that he is in favor of private accounts as an "add-on" to Social Security. He also said that Social Security trustees--one of whom is Labor Secretary Elaine Chao--should be given the authority to invest Social Security funds in the stock market and other high-yield financial instruments. Instead of personal accounts, Mr. Hoyer is envisioning public accounts controlled by the government and used to raise funds for Social Security, much the way Calpers invests funds to pay for California state employee pensions.
Too risky for you and me to opt into, but just peachy for the feds to put everyone's money into. The issue isn't risk, but who controls the money, and what the welfare state will look like for years to come. Preventing funds from being diverted to private accounts means keeping Social Security as more of a welfare system.
As you should know, the only reform I can really endorse is to truly privatize the system, i.e. let people opt out entirely.
Posted by Walter at March 29, 2005 03:05 PMWalter,
I think you have a very good grasp on this. The Dems want to control us from birth to earth.
Keep up the good work.
Myron
I agree with your course of reform, but it just wouldn't work. We barely have enough money coming in to pay seniors today, and we won't have enough money tomorrow, even with everyone paying in. The only people that will opt out are young workers, not the oldies that are about to get checks, so we'll have even less money to pay the same ammount of benefits.
Sigh. I wish we could do something.
Posted by: Matt Moore at March 31, 2005 01:05 AMIf by 'wouldn't work' you mean the country doesn't have the political will, then you are correct. There are ways to get it done, but all of them involve politically unpopular moves, like cutting large parts of the federal budget.
Posted by: Walter at March 31, 2005 02:04 PMI think it wouldn't work because it might just bankrupt us to let the people paying in drop out while still paying out.
Beyond that, yes, there's no way it would work politically.
Posted by: Matt Moore at March 31, 2005 09:14 PMBasically what this means is that for the younger workers, the payroll tax is just a tax. They can't expect to get any benefit out of it worth talking about.