This week's TNR features dueling pieces on Social Security. The second, by Jon Chait, is a principled case for obstructionism, hitting all the points you blog-readers have now committed to memory. The first, however, is by Greg Mankiw, former Chair of Bush's Council of Economic Advisors, and it argues -- I'm not making this up -- that Social Security privatization is a good thing because he and his colleagues at Harvard have similar pension plans (also known as 401(k)s and they like them fine.
Putting aside the ivory-tower elitism that should have O'Reilly rushing to retch, can conservative arguments reach any lower? Maybe we should stop funding defense, just for a single year, and give each American an equal share of the savings, which would mean everyone gets a check for $1,332.43. With that money, they can invest in stocks, weapons, whatever they want. It'll be an enormous economic boost, allow consumers to make wise decisions for the future (defense or assets? Hmmm...), and best of all, not touch the deficit in any way! We can encourage savings by making the giveaway tax free so long as they're socked away in -- you guys will love this! -- Defense Savings Accounts! Damn are we gonna create wealth!
That's a good idea, isn't it? So why don't we do it? Well, it's risky. Even if we didn't tell the rest of the world that the money was coming from Defense, there's always the possibility that we could be attacked. I mean, it's rare that attacks are launched on our soil, and even when they are, we're generally unable to stop them, but you don't want to take the risk, you know?
And that's why I'm genuinely interested in the conservative pathology on this. Because they do know that. So why is it so tough for them to understand that Social Security is a system of insurance, not a wealth creation program? I have no problem with wealth creation, hell, I think we need a lot more of it. And I'm a fan of many of the excellent plans floating around that'll do just that. But we can repeal the tax cuts or not launch wars or something if funding one of those is our aim. But all the wealth creation in the world can't compete with a poor economy and a touch of bad luck. That's why Americans need at least one layer of protection between them and the fluctuations of fate.
What's weird is that this is Mankiw speaking, not some hackish Senator; he should have read enough economic history to realize that the stock market occasionally crashes. But it's really the most amazing thing; these otherwise smart folks join the Bush administration and it's like all sense of history or caution is zapped out of their psyche. It's the great sucking sound of our generation. Really one of the stranger phenomena in modern politics.