...for starting Social Security debate
The Libertarian Party, which has been urging Social Security privatization for decades, today credited President Bush for starting the debate but said his proposal falls far short of the truly private, no-strings-attached plan that the American people really want.
"The first step toward solving a problem is admitting that a problem exists, and Bush has done that," said Libertarian Party Executive Director Joseph Seehusen. "Now we need to make sure that the American people don't get hoodwinked again by false promises about where their retirement money is going and who controls it."
In his State of the Union speech on Wednesday night, Bush acknowledged that the Social Security program is "headed toward bankruptcy." The president proposed a system under which workers under age 55 could put money into a voluntary personal retirement account, and he assured Americans that the money is "yours, and the government can never take it away."
"Libertarians' first instinct was to tell the president, 'Thanks for stealing our idea! Now please implement it,'" Seehusen said. "But after reading the fine print, the Bush plan has several disturbing elements."
According to an article in today's Washington Post, a preview of the plan by Bush administration sources indicates that:
- The government would keep and administer the money, and would also choose the mix of stocks and bonds that would be eligible as investment vehicles.
- Workers would have no access to the accounts before retirement, and could not borrow against the balance.
- Even at retirement, workers could not access the money as they chose. They would be forced to buy an annuity, which would provide periodic payouts.
Seehusen said: "Let's see, the government controls your money from start to finish and dictates where it can be invested. Then once you retire, your money still isn't yours -- it belongs to Uncle Sam, who will give you a small monthly allowance.
"If that sounds familiar, it should, because it's more similar to the Social Security system we have now than to the private 401K and IRA plans that are working so well.
"As to Bush's claim that the government can never take 'your' money away; it's true, but only because the government will never give you 'your' money in the first place."
Nevertheless, the Bush proposal does have elements of a private, free-market plan, and Libertarians hope it can be improved as it moves through Congress, he said.
A recent Zogby poll commissioned by the Cato Institute shows that 51 percent of Americans support private accounts and only 39 percent are opposed, Seehusen noted.
"That indicates that Bush should have introduced a much bolder plan -- one that at least puts the money into the hands of individuals and private companies rather than politicians who have broken their promises so many times in the past," he said. "Let's work to enact a truly private retirement system, and let's do it for the children."
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