Friday, January 21, 2005Bush's Social Security Proposal
I have a guest contributor today, Leon Winer. He writes:
Bush’s Social Security Proposal
What I don't like about Bush's proposal is the way he is proposing to change Social Security.
He wants to change the accumulation side of the equation. Wrong approach. Too slow. Too complicated. Too costly. Too much political opposition, the AARP, for example. Only lukewarm support from the financial industry.
He should be changing the distribution side: allow every SS recipient to roll over his future monthly checks into lump sum tax-deferred payment to a personally supervised IRA account. Very fast. Very simple. Very cost-efficient. No real political opposition and probably enthusiastic support from the financial industry.
If only 10 percent of SS recipients chose this option, about 4 million new IRA accounts would be created with a total value of about (4 million times $100,000) or $400,000,000. A fast, significant move toward an ownership society.
There is very little that is novel about my proposal. There are well established institutions that could handle this proposal quickly and efficiently.
So, why didn’t Bush propose distribution side ownership, which is simple, fast and efficient instead of the cumbersome approach?
Well, Bush’s mind is a mystery to me. My only guess is that like virtually everything else that Bush does, his proposal is just another scam. His goal is not an ownership society. In the case of Social Security, it’s much simpler: it’s the absolute and total destruction of Social Security.
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Bush’s Social Security Proposal
What I don't like about Bush's proposal is the way he is proposing to change Social Security.
He wants to change the accumulation side of the equation. Wrong approach. Too slow. Too complicated. Too costly. Too much political opposition, the AARP, for example. Only lukewarm support from the financial industry.
He should be changing the distribution side: allow every SS recipient to roll over his future monthly checks into lump sum tax-deferred payment to a personally supervised IRA account. Very fast. Very simple. Very cost-efficient. No real political opposition and probably enthusiastic support from the financial industry.
If only 10 percent of SS recipients chose this option, about 4 million new IRA accounts would be created with a total value of about (4 million times $100,000) or $400,000,000. A fast, significant move toward an ownership society.
There is very little that is novel about my proposal. There are well established institutions that could handle this proposal quickly and efficiently.
So, why didn’t Bush propose distribution side ownership, which is simple, fast and efficient instead of the cumbersome approach?
Well, Bush’s mind is a mystery to me. My only guess is that like virtually everything else that Bush does, his proposal is just another scam. His goal is not an ownership society. In the case of Social Security, it’s much simpler: it’s the absolute and total destruction of Social Security.
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