- The Washington Times - Thursday, March 24, 2005

The president is out on the hustings. Yes, he remains on the campaign trail. He is supposed to be taking a break in Crawford, Texas, but his schedule shows him flying out across the country almost daily. Campaigning. What is he campaigning for? The answer is Social Security reform.

Here in Washington the press has if anything understated how much George W. Bush cares about this issue. One might well ask why he cares so ardently about it. Surely it is not as glamorous as defeating tyrants abroad, a task he has well in hand. Yet only the author of Social Security, Franklin Roosevelt, has invested so much intensity in securing the future of the nation’s retirees.

GWB is an unusual Republican. I say he is unusual because he has such ardor for politics. Most Republicans do not. In fact, a major difference between Democrats and Republicans is to be found in their political libidos. The Democrat has the political libido of a nymphomaniac. The Democrat politicizes practically everything and lusts for it madly. The Republican has the political libido of a eunuch.

That is why today Social Security reform is in trouble. Only this Republican president and a handful of fellow Republicans are truly engaged in the fight. Had the Democrats decided to reform Social Security, the process would be well on its way.

Back in the 1990s, when it was popular with both Democrats and Republicans to recognize the system needed reform, action was heating up. President Clinton had put together a bipartisan group to reform the system. But other matters overtook him, and so now it has fallen to Republicans to push for reform.

That means the reform movement is in trouble. The Republican political libido is part of the problem as is the Democrats’ political libido. The Republicans lack the president’s ardor. The Democrats see a larger political advantage in denying Republicans a Social Security victory and oppose the president day and night, week in and week out.

And there is one other matter. The Democrats of today, that is to say the left-wing Democrats, have no belief in growth economics. Growth economics will preserve retirees’ security.

The current Social Security system is an unfunded liability. It is without investments to back it up. It is headed toward bankruptcy or becoming a tremendous burden on the economy.

David Malpass, chief economist of Bear Stearns and for my money one of the country’s sagest economic minds, argues Social Security reform should be selling itself — it is that desirable. In the April issue of the American Spectator, he offers eight reasons. Allow me to pass along four.

(1) With expanded use of personal accounts, there will be “less risk, more benefits.” Mr. Malpass goes on to argue the present system’s insolvency “creates an immense risk for the young.” As for benefits, “the current benefit system offers an assumed return of 3 percent per year, but that is completely dependent on the beneficiary living long enough to collect.” Whereupon Mr. Malpass cites “Jeremy Siegel, one of the world’s experts on long-term equity performance,” who “forecasts real equity returns [before inflation] at 6 percent per year over the next 44 years. … Personal accounts clearly offer the likelihood of more benefits than the current system, without the risk of the government voting them away.”

(2) Another obvious benefit from Social Security reform is job growth. Says Mr. Malpass, “The current Social Security system imposes a gigantic tax on jobs — 12.4 percent of pre-tax income including the employer and employee portions.” Reducing the tax and allowing workers to invest more of their income, will create jobs and increase the economy’s growth.

(3) Social Security reform will increase “fairness” for the “frail or minorities, who tend to die earlier and lose their benefits.”

Moreover, the present system is “unfair to those who want to work past 62 or start working young, since the benefit formulas … give minimal extra benefit for working more years.”

(4) Finally, Mr. Malpass sees Social Security reform freeing Americans from “dependence on Washington. Retirees now rely on Washington largess for their checks,” which distracts elections from wider issues to questions of Social Security’s benefits. “For now, every election has to be first a vote on the size of Social Security payments, then a vote on other issues.”

So it is time to get Social Security out of politics and on an economically sound basis. That is Mr. Malpass’ message, and it ought to be the Republicans’ too. It ought to even be the Democrats’ message. Yet their political libidos will not allow it.

Thus we have this one great campaign waged by the president. He could benefit from reading Mr. Malpass’ entire argument.

R. Emmett Tyrrell Jr. is the founder and editor in chief of the American Spectator, a contributing editor to the New York Sun, and an adjunct scholar at the Hudson Institute. His latest book is “Madame Hillary: the Dark Road to the White House.”

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