Privatizing Social Security

May 30, 2000

Is George W. Bush crazy? Well, lots of people in the Democrat party think that he is because he is talking about changing Social Security. After all it's been called the "third rail of American politics." Touch it and you die. And George Bush not only wants to touch it, he wants to begin to privatize Social Security.

In recent speeches he has argued that American workers should be allowed to invest a portion of their Social Security contributions in stocks and bonds. This would begin to turn a regressive tax into a true savings plan. And many argue that this would be a way to extend the solvency of Social Security while strengthening the economy and easing retirement anxieties of baby boomers.

Vice President Al Gore claims that making such a fundamental change is dangerous. He uses his favorite phrase to describe it: he calls it a "risky scheme." He equates investing in the stock market with gambling.

Frankly in the past, Mr. Gore's arguments might have been persuasive. But something has changed in the electorate. As I mentioned in a commentary back in February, more and more Americans own stock. The rise of what many are calling "the investor class" is changing American politics for all time. When Ronald Reagan took office, only 16 percent held stock. Now nearly 50 percent do through mutual funds, pensions, etc.

George W. Bush is (excuse the pun) betting that the American voter sees the wisdom of beginning the process of privatization. When Social Security was begun the average life expectancy was 61 and retirees didn't receive money until age 65. Also, there were nearly 40 workers for every one recipient. Times have changed, and that's why George Bush is willing to talk about privatizing Social Security.

I'm Kerby Anderson of Probe Ministries, and that's my opinion.