Tuesday, February 15, 2005

President Bush Uses Social Security To Appeal To Youth

I have stated several times in the past that the Democrats opposition to private Social Security accounts could have a much deeper and long term impact on the party than people believe. Perhaps the pundits, talking heads and yes, bloggers, that are past the age of say, 35, do not understand how this issue is discussed among younger working people. It has caused great debate and although this is by no means a scientific survey, even among my acquaintances that did not vote for the President in the last election, the idea of allowing individuals some control over even a small portion of their Social Security is very popular. While the talking heads may not recognize this, the White House does and the President has begun to appeal directly to the younger generation of workers.

Why is this idea so popular with the younger generation? First of all, before the idea of private accounts was proposed, my wife and I never calculated social security into any retirement plan. We assumed that when we retired there would be no social security, and in fact we still make the assumption that Social Security as we know it will not exist. So the fact that a private account would contain money "safe" from the government, that we could invest and nurture and even pass along to our children is very appealing. Secondly we basically grew up with the internet and feel comfortable using it to direct our money as we see fit. We do this now with our 401-k's. We simply log in to our account, see our account summary and move money around as we see fit... 24 hours per day, seven days a week if we so choose. Although the details of the plan have not yet been clarified, I imagine that a private social security account would work much the same way. You set the percentage to be put in the account every month, you log in and you invest it in the available funds as you see fit. Easy. In the past three years my wife and I have averaged close to a 20% return on her account and a 15% return on mine. Why should we not be allowed to keep a small portion of the money we pay into social security in an account so that we can grow it as we see fit? If I can make 15% or 10% or 5% on my own money and develop a nest egg, why should I not be allowed to do so? The fact is that if I were allowed have a private account that grew as it should, I would be willing and able to forego the monthly social security payments after retirement just to "keep" the funds in the private account.

The Fox News article linked above contains this paragraph:

However, while the Bush team and like-minded Republicans may be selling, not every young American is buying. Polls indicate that younger Americans believe Social Security won't be available to them when they retire but at the same time, they are unsure about whether to privatize some of the program and risk losing some of their promised benefits

As far as that is comprehensible, it is ridiculous. So young people are afraid of losing some of the promised benefits that they do not believe will be available at all?

If the paragraph accurately summarizes the poll, then the administration needs to focus more on younger voters to educate them on what the private account would actually mean. If you are afraid or you do believe that social security will not exist when you retire then you should be demanding that the government allow you to set aside money in a private account that you would own. That is the only way to guarantee that you receive some benefit from the program after retirement.

This program would be a boon for Americans and for the idea of the "ownership society". As we slowly loosen the grip the government has on our lives we will see greater economic freedom in this country. Setting aside a small portion of social security into a private account would be a great place to start.

More on this a little later.

Be sure to check the current posts for updates.