Social Security Piratization

Richard Cohen making sense today on the Republican plan to begin phasing out Social Security through privatization:

Frankly, I am agnostic about private savings accounts. My own has worked pretty well, but that's not because I consciously made wise investments. It is rather because I was damned lucky, having foolishly invested disproportionately in my own company, which -- by holding down my own salary, among other things -- has become beloved by Wall Street. As for most Americans, the data suggest that they do not manage their own funds in a professional manner. When it comes to 401(k) plans, which have been around for more than 25 years, some companies now limit investment options because their employees have been so dumb about making investments. That's understandable. After all, most of us are far too busy making a living and living a life (raising kids, walking the dog, playing computer solitaire) to figure out what a derivative is.

The trouble with Bush's Social Security plan is that it is almost entirely driven by ideology. For instance, one obvious way to pump some cash into the Social Security trust fund is to raise taxes -- not on you and me, mate, but on the rich. But as with income taxes, the rich shall not be touched in this administration and so common sense is off the table.

Similarly, to ensure that Americans approaching retirement will get the benefits they were expecting and at the same time divert money into personal retirement accounts, about $2 trillion will be borrowed. For some reason, this additional debt will not become a burden to any one of us nor, for the same mysterious reason, will it affect interest rates or be noticed by the very people who have been driving down the value of the dollar. This is as certain as finding weapons of mass destruction in Iraq.