Let the Campaign Begin--Prepare to change the way you think about Social Security.

Wall St Journal ^ | December 1, 2003 | PETER FERRARA

[SJackson]

A long time ago, in a presidential campaign far, far away, George W. Bush put the idea of a personal account option for Social Security on the national agenda. It was and still is a good idea. Such reform would allow workers the freedom to choose to shift a portion of their Social Security payroll taxes into their own personal investment account, which would then finance a proportionate share of future Social Security retirement benefits. Get ready for the sequel: Bush administration officials have said such reform will be a focus of next year's campaign, and a second Bush term.

[SJackson]

Social Security Breakout--How Bush can vindicate his Medicare giveaway

[BIGZ]

Government employees, state, city, ( teachers, police, firemen, city employees ), are allowed to opt out Social Security, their retirement plans are funded in a private manner and most are fully funded and over funded.

Private funding works and the evidence that it works is overwhelming. How can the liberals and Democrats argue that it will not be an effective alternative to the system we now ENJOY.

[goodnesswins]

Ah, but, you, the peon, are not SMART enough to choose a firm to manage your own money.....only gov't employees can do that..... /sarcasm.

[steveegg]

Government employees, state, city, ( teachers, police, firemen, city employees ), are allowed to opt out Social Security, their retirement plans are funded in a private manner and most are fully funded and over funded.

Private funding works and the evidence that it works is overwhelming. How can the liberals and Democrats argue that it will not be an effective alternative to the system we now ENJOY.

It would dilute the gubmint (and other) unions' ability to influence the market through their pension plans.

[Libertarianize the GOP]

ping

[The Raven]

This is news - when the SS Administrator says PSAs will work.

[Matchett-PI]

Thanks for posting this article. I was going to post it myself a few minutes ago, then decided that I'd better do a search first.

A friend of mine had emailed me a copy of it earlier today along with a copy of the letter he wrote to Mr. Ferrara. I'm copying it below if you're interested. He wrote:

Dear Mr. Ferrara-

If you have not seen my articles on the Social Security dilemma, you will find some additional data and insights of value in them. Please take a look (links below).

The first was written during the Bush campaign of 2000. The second is a follow up.

I heartily applaud the contents of your op ed, "Let the Campaign Begin," in today's Wall Street Journal. I think 2004 is the Goldilocks year (and one of maximum opportunity) for George Bush to lead and carry the day for vast reform along the lines you have suggested.

Particularly attractive (especially from a political saleability standpoint) is the progressive feature of the magnitude of allocations for lower income workers that you propose. I had not thought of that and commend your sensitivity and sensibility to strengthening the likelihood of getting the appropriate legislation passed.

If you plan is good on all the counts which you address, why would it not be getter with a greater allocation of the current 12.4% tax rate be more desirable, even--dare I say it?--up to the point of 100% allocation to private accounts? Would not results be attained more speedily, more efficiently, more satisfactorily, mutatis mutandis?

There are several points in my articles which address some of your proposals differently, and one, not addressed (but should be, in another place--the matter of 'real returns'--about which I will want to write to you shortly).

Articles at-
http://www.advanced-stock-selection.com/SocialSecurityDraft.htm
http://www.advanced-stock-selection.com/social-security-II.htm

Respectfully,

[Name and Town]

[Matchett-PI]

((((Ping))))) to #8

[sourcery]

Some form of incremental privatization of Social Security and Medicare is an absolutely essential part of any strategy to undo the New Deal and the Great Society. "Two steps forward, one step back."

[Consort]

Federal retiree widow(er)'s may get reduced or no benefits from social security spouse's accounts because of government offset pension/windfall elemination provisions.

[Starwind]

Thanks for the ping.

These investments would be made through a social structure where workers would choose from a broad range of investment funds managed by major firms, approved and regulated by the government. The system would be backed by a safety net providing a federal guarantee that workers would receive from the account at least what they would have been paid by Social Security under current law.

This would seem to have the makings of another "too big to fail" collection of Government Sponsored Enterprises (or maybe the current group, Fannie, Freddie, etc) reinvesting our SS dollars into MBS insured by yet more derivatives.

I do not believe the government is competent to pick or guarantee "major firms". The SEC can't even enforce the laws applicable to these major firms now, and this just gives them more guaranteed cash inflow with which to manipulate markets.

While I applaude serious efforts to reform SS (and this seems one of the more serious), the government needs to simply stop taxing my income away and dictating to me how to invest it for my retirement. If they knew what they were doing better than most of us, the government would be solvent and the rest of us would be $10T in personal debt. But that isn't the case, now is it?

Real reform would be to phase out SS altogether, eliminate the SS tax, prosecute Fed & SEC reg violations, and implement truely honest FASB/GAPP reporting standards, and stop federal deficit spending and the accompanying monetary inflation. What a concept.

[BIGZ]

OK, the program was not designed as a welfare but that is what it has turned into.