Jewish World Review Feb. 17, 2005 / 8 Adar I, 5765
Social Security's anti-reformers remain good citizens of the 1930s
The other day, while visiting a sick aunt in
Little Rock, Ark., I happened upon the Clinton Library and thought I might
check out a book. I, in my innocence, presumed that the Clinton Library is a
lender's library. How wrong I was.
True to the Clinton tradition, it is a taker's library and
they took my attaché case, my camera and some loose change.
Alas, this is the monument created for the former Boy President,
who shimmers in the eyes of many Democrats as "one of our greatest
presidents." If so, among his peers would be numbered, perhaps, Warren G.
Harding and Millard Fillmore.
While at the Clinton Library, I thought I would review what the
Boy President thought of Social Security reform. He was for it. Now he is
still for it, except when he is against it and he is usually against it
when it is being propounded by a Republican.
The most offensive Republican propounding Social Security reform
is the president. That is not because his reform is so radical. It is not
all that much different from reforms bandied about by moderate Democrats in
the 1990s. It is because his reform envisages an entirely different view of
the citizen's relation to society. His reform envisages what he calls an
Today's Social Security was born of a different era, an era in
which government gives to the citizen. In today's era of markets and growth
economics, the citizen creates wealth, owns a part of the economy and gives
to government ideally only a modest amount through taxes. After all,
government's largess has little to do with growing a society. Peter Drucker
said it best years ago: What government does best is wage war and inflate
Social Security, bred of the collectivist 1930s, could not give
Social Security recipients as handsome a return as today's private
investments portfolios can because its managers had no notion of the dynamic
growth economy that exists today. Moreover, Social Security was based on a
funding plan that has almost completely disappeared. It was based on a
population wherein 16 or more citizens were taxed to pay the benefits of but
one Social Security recipient. But the post-baby boom generations that have
followed have steadily produced fewer children, which is to say fewer
sources of Social Security revenue.
Today, only three citizens are available to provide the funds
for the growing number of Social Security recipients. Things will soon be
worse. We shall be down to a two-to-one ratio.
But that is not the only problem facing the present system. The
return Social Security recipients receive from a life of paying into the
government's Social Security system is only about 1.4 percent of the
investment. That is a 1930s return on investment. At present estimates, that
rate of return will in coming years become a negative return. That is a
Great Depression era rate of return.
Private investment accounts pay out over 4 percent. The
president's plan for reforming Social Security envisages that kind of a
return. Moreover, holders of what he calls Personal Retirement Accounts will
be free to bequeath whatever remains in their accounts at the hour of their
deaths. That cannot be done by today's Social Security recipients. If there
is any money left over, the government gobbles it up.
Critics of Social Security rightly argue that the present system
is a huge pyramid scheme. The scheme is heading for disaster, as the ratio
of retirees increases vis-à-vis the population supporting them.
Perhaps the bankruptcy of Social Security is not as near and
will not be as catastrophic as some think. A tax increase and lowered
benefits can keep the scheme going. Yet higher taxes impede economic growth,
and cutting back benefits to those who have already been coerced into
funding the system is unfair. Better it is to support the president's plan
to give retirees a higher return and the option of passing on their Personal
Retirement Account to their heirs.
This dynamic vision of society is, I suspect, what really
offends the president's critics. They are true reactionaries. They live in
the 1930s and tell us that the president is out to repeal the New Deal. But
the New Deal cannot be repealed. It is part of American history.
It might even have been the best national retirement program
possible in its day. But that was seven decades ago. The economy has
changed, and it is time that we develop a retirement program that benefits
from that change.
Every weekday JewishWorldReview.com publishes what many in Washington
and in the media consider "must reading." Sign up for the daily JWR update. It's free. Just click here.
JWR contributor Bob Tyrrell is editor in chief of The American Spectator. Comment by clicking here.
02/10/05: Here's a shocker: GWB reads books!
02/03/05: The runaway winner of the treasured Worst Book of the Year award
01/24/05: Unthought through
01/14/05: Dan Rather's unlamented departure
01/06/05: Dean's destiny
12/30/04: How to end the current hysteria over painkillers
12/16/04: The Left always gets its man
12/06/04: Kofi's got his Kojo working
11/25/04: Tough guys who make their own rules
11/18/04: Now Behold the Liberal Crack-Up
11/11/04: Dems behind the values 8-ball
11/04/04: Diabolizing a perfectly agreeable gentleman didn't work for the party of a perfectly dreadful candidate
10/28/04: Black Cats and the Braggart
10/21/04: The Fantasist Candidate
10/14/04: Label Avoidance
10/06/04: Are these debates a waste of time?
10/04/04: What would our neo-peaceniks have said about the Emir of Bokhara?
09/23/04: Russians know a thing or two about terrorist preemption
09/20/04: The 'Shark Tale' Mafiosi
09/09/04: When They're 64
09/02/04: No Chicago
08/27/04: Judgment and character
08/19/04: Foreign policy is just another of their partisan obsessions
08/12/04: Missing Nixon
08/05/04: Is boxing down for the count?
07/30/04: The cranky convention
07/22/04: France is on the march so don't dare get out of line
07/15/04: Who's to Run the CIA?
07/08/04: Heroes and celebs: Don't ruin latest 'star'
07/01/04: Gentlemen do not begin a government in the middle of the week
06/24/04: If they only mastered the art of lying
06/18/04: Fie on the French and Germans
06/10/04: Reagan on the Rock
06/03/04: Once again the conservative fuddy duddies are vindicated
05/28/04: Rev. Al eats up City Hall
05/20/04: Pasty prison pastimes
05/13/04: Loss of perspective
05/06/04: Right in the Krischer: Rush Limbaugh's tormentor has yet to hear from everyone on the First Amendment right
04/29/04: It is 1992 all over again, and I rejoice
04/15/04: There seems to be two George W's
04/08/04: Kennedy & Kerry
04/01/04: Sen. Jean Francois' fun and games are only starting poor Dems
03/25/04: What really explains the rancor arising in this election year?
03/19/04: College daze
03/11/04: The understandably confused are confused
03/04/04: Hillary, the loyalest of the loyal
02/19/04: Hannity's optimism
02/12/04: The moron vote
02/05/04: At least Lieberman stood for something
01/29/04: Surprised by the government vendetta against Rush?
01/15/04: Eight Angry Men
01/09/04: Doc, the greatest swim coach of all time
01/02/04: It’s lying time again
12/29/03: Alternative "Person of the Year"
12/18/03: Dean and me
12/11/03: Long live Bob Bartley
12/04/03: "Hit 'em when they're down!"
12/01/03: The Wright Stuff
11/13/03: How wrong the naysayers and the utopians have been
11/06/03: Will I be banned from America's campuses?
10/30/03: They don't care about restraint
10/24/03: "The Reagans" and the evidence of a historic life
10/17/03: The Moron Vote
10/09/03: The politics of groping and the groping of politics
10/03/03: Is there a witch doctor in the house?
09/26/03: Funny Girly-Boy
09/18/03: Send Arafat to Paris!
09/15/03: The soi-disant party of Latinos comes down hard on a successful Latino
09/05/03: Placating the carpers
08/29/03: A melange of one-issue enthusiasts will win?
08/07/03: Angry partisans
07/31/03: Why no holy cities in America?
07/25/03: They underestimate not only the president, but the American people
07/18/03: The irascible, bigoted Harry Truman was a product of his times
07/11/03: A grand affair of hot colors and surprisingly sedate audience participation
07/04/03: In search of anti-Americanism and the perfect bullfight
06/26/03: Calling on London
06/20/03: Too upsetting for the evening news?
06/12/03: Rain(es)ing Clintoon myths
06/05/03: Hillary-ous is pathetic
05/22/03: End of the last great persecution of the 20th century?
05/15/03 :Grey turns to grim at Times
05/08/03: The only intellectual force in Western history to gain moral superiority by being wrong
05/01/03: Dinning with Tom Wolfe: More lessons in nusual aspects of American life, hitherto ignored
04/28/03: Ambuscade at scholarly frontier
04/21/03: Stars in search of a galaxy
04/10/03: Baghdad Bob and Tom Daschle
03/31/03: When the media itself becomes the story
03/20/03: Revealed! Estrada is a gifted linguist -- a Japanese-American fluent in Spanish
03/14/03: Genuinely in charge
03/10/03: Stalin and Saddam
03/05/03: They just cannot stomach a protracted alliance with the Bushies
02/25/03: Identity gridlock
02/18/03: People calling Dean a fruitcake are underestimating his political savvy
02/13/03: The new political establishment
01/30/03: The time is now
01/27/03: Witnessing self-love by people completely incapable of self-criticism
01/21/03: Of course our kiddies are depressed
01/13/03: Why is it that Official Washington still believes that a tax reduction means a revenue reduction?
01/02/03: Missing Moi
12/27/02: The grizzled and menacing-looking senator in Confederate drag is … a Dem
12/24/02: Uprooting Christianity in the Holy Land
12/20/02: Under fire, Lott showed an ignobleness that is embarrassing
11/26/02: Bartley's enemies have been routed
11/14/02: Clarence Thomas and the segregationist Mississippi sheriff
11/07/02: I muffed up
10/31/02: Is the American university turning its back on change, on progress?
10/24/02: So why aren't the Dems buoyant?
10/17/02: Mourning the loss of the "yellow-belly"
10/10/02: American politics at its most ignominious
10/03/02: A man above the law, a bully
09/26/02: Is Bob Greene a victim of an anti-Clinton backlash?
09/19/02: I knew Mafiosi and …
09/12/02: Chickens and poseurs
09/05/02: Sympathizing with the Europols
08/29/02: 9-11 did not change us forever
08/22/02: Public persons frivoling with serious matters
08/15/02: Beachcombing among the fat of the land
08/08/02: They pave the way for corruption, not personal responsibility
08/01/02: Believing the unbelievable
07/25/02: The congressional posse comitatus
07/18/02: Cosmopolitan Arab fashion
07/11/02: What the prez actually knows
07/04/02: The vindication of a truly original thinker
06/27/02: The perfect book for Hillary
06/20/02: To say that they were ordinary is not to slight them
06/13/02: Daschle must begin to act like an adult
06/06/02: Lack of "intelligence" --- and sheer stupidity
05/30/02: Revealing a carefully guarded media secret
05/23/02: In these times, thank Heaven for Clinton!
05/16/02: Fast Times at the Church of the Nativity
05/09/02: "Name the Prettiest Suicide Bomber"
05/02/02: Vindication for the Boy Scouts
04/25/02: A topic almost no other columnist will touch
04/18/02: 'Conventional Wisdom' --- and those who defy it
04/11/02: Let the Sun shine in
04/05/02: Hooded men of color in sheets
04/01/02: A McCain-Feingold Act for Hollywood
03/21/02: Yakkin' on Yates
03/15/02: No role for Paul Volcker in Enron: the movie
03/07/02: My membership in the Communist Party U.S.A.
02/27/02: This award is bestowed by 'contrarians'
02/21/02: Mike Tyson: Made for Washington?
02/14/02: Enron as underdog?
02/07/02: Freed from the presence of money -- hard or soft -- most politicians would be just as bad
01/31/02: Needed: Bush to make a preemptive strike against his enemies …. Ones who'd like to see him fail even during war
01/24/02: Hucksters will move on to make their next marks
01/17/02: Debonair prez should begin to do the High Life
01/10/02: Move over Twinkies --- "the acne medicine made him do it!"
01/03/02: Leaving the Nazis looking comparatively humane
12/27/01: A "self-made journalist"
12/20/01: Calamities and unanticipated benefits
12/13/01: America's grief ought not to give comfort to those who caused it
12/06/01: Leahy, the strict civil libertarian!? A short-term exploiter of the Constitution is more like it
11/29/01: Welcome to Afghan, Maryland?
11/26/01: So, why don't more folks hate us?
11/15/01: America's quagmire and other certainties
11/09/01: No longer the smug statists, the prodigal Keynesians?
11/01/01: The New Seriousness
10/25/01: Bright lights and the Taliban
10/18/01: Is bin-Laden propaganda from Western intelligence?
10/12/01: No yellow ribbons
10/05/01: Bubba's back --- again!
09/28/01: Exposing peacetime's frauds
09/21/01: So protected, we're vulnerable
09/14/01: At Barbara Olson's home
09/11/01: Duh! All conservatives are racists
08/31/01: Arafat's terrorists have created their own hell
08/24/01: Time for some political prophecy
08/16/01: They claim to be doing so much good
08/10/01: Visiting the source of the White House braintrust
08/03/01: Morality and reality
07/31/01: Blinded by success?
07/24/01: The latest Kennedy capitulation in Massachusetts
07/13/01: Talk about tawdry
07/06/01: Delighting in the Dictator
06/29/01: The G-dphobes
06/21/01: Fashionable Washington is sempiternally in a stew
06/15/01: The limits of hypocrisy
06/08/01: Flagging our general apathy
© 2001, Creators Syndicate