christophe thinks out loud

What is the Social Security Crisis of which you speak?

That commie, left-ist pinko rag The Economist has a very good editorial on the supposed Social Security “crisis.”

In summary:

1. The system is not going to go bankrupt, even on current predictions.
2. While private accounts may be a virtue for other reasons, they are not required to keep the system solvent.
3. In the short term, private accounts will make the overall government financial position much worse.

The best quote is:

The long-term burden of Mr Bush's first-term tax cuts and spending increases is three times bigger than the looming Social Security shortfall. Pension reform is desirable; but it will not solve America's long-term fiscal problems, and if its political price is an out-of-control budget, that would be a serious mistake.

The focus on private accounts is misguided, but let us not kid ourselves: This plan is about delivering billions (trillions, potentially) of dollars into private financial sector care, a windfall of astonishing proportions. It is a wealth transfer from the government to the rich, which is the defining financial policy of the current administration.

posted 11:41