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November
8, 2002 9:00 a.m.
Going
the Distance
Republicans
and Social Security.
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epublicans
all over America. . . distanced themselves from privatizing Social Security,"
wrote Al Hunt in yesterday's Wall Street Journal. He cites Chris
Chocola, who won an Indiana House seat on Tuesday. Two years ago Chocola
told an editorial board he would eventually like to see "the entire
system privatized." Hunt writes, "This fall, there was no such
talk as [Chocola] opposed investing any Social Security funds in the markets.
Colorado Republican Sen. Wayne Allard did a similar flip-flop. . ."
It's certainly true
that Republicans repudiated "privatization," which they redefined
to mean ending Social Security as a government program. It's also true
that most Republicans oppose "investing any Social Security funds
in the markets" if the federal government would be directing the
investment. Finally, it's true that many Republican candidates were defensive
and not noticeably eager to talk about the subject.
But very
few Republican candidates came out against personal retirement accounts
(and even fewer successful ones did). And Chocola and Allard were relatively
bold in supporting them — which is not surprising in Chocola's case,
considering that he was one of the Club
for Growth's candidates.
In late October of
this year, Chocola brought Rep. Rob Portman to back him up on Social Security.
Here's what Jack Colwell of the South Bend Tribune reported: "Portman
and most other Republicans, including Chocola, say the term 'privatization'
distorts President Bush's concept of allowing individuals to invest a
portion of their payments for Social Security in individual investment
accounts. . . . Portman and Chocola stressed that investments would be
voluntary and that nobody would be forced to put even a dollar in the
stock market."
As for Allard, here's
an exchange he had with Tim Russert on Sept. 22, 2002.
RUSSERT:
Senator Allard, you have suggested creating private accounts in Social
Security.
ALLARD:
Yes.
RUSSERT:
Some call that privatizing.
ALLARD:
Yeah. Yeah.
RUSSERT:
Democrats prefer that term. Republicans object to it.
ALLARD:
Yes.
. . . .
RUSSERT:
Are you willing to put that idea on the back burner for the time being?
ALLARD:
Well, first of all, I don't support "privatizing Social Security."
[Note: the quotation marks are from NBC's transcript.] What I do support
is that we give individual choices, just pretty much like federal employees.
It's still managed by the federal government, like you do the federal
employee, and they give their indication, the participant, on how they
want to have their money invested. . . .
In an October 6 event
, Allard was asked whether he supported privatization and answered: "Well,
you know, people define privatizing Social Security as being outside the
government. I would be for keeping it within the Social Security system
and giving people choices as to how they want to invest it."
On October 8, Charlie
Brennan of the Rocky Mountain News reported: "Allard calls
for 'individualizing,' which would give taxpayers the option of putting
some portion of the money that would otherwise have been taken in federal
taxes into stocks, bonds or a savings plan of their choice."
Hunt goes on to write
that "[e]ven those candidates who didn't duck — John Sununu
in New Hampshire or Elizabeth Dole in North Carolina — misled voters
by suggesting partial private accounts were a free lunch with no costs."
Actually, private
accounts are free in the sense that they generate no new costs
(excluding possible administrative ones). They merely move forward the
cost of obligations already incurred. They aren't a free lunch, though,
if what's meant is they obviate the need for any benefit cuts or tax increases
to solve the program's financing shortfall. But those benefit cuts, or
tax increases, are necessary in the absence of private accounts, too.
They'd have to be bigger. It can't be the case that private-account supporters
are obligated to talk about benefit cuts but opponents aren't.
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