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Novermber 1, 2002, 8:30 a.m. How’s the Granny Card Playing? The evolving politics of Social Security. By Ramesh Ponnuru , from the November 11, 2002, issue of National Review

he charges and counter-charges being made about Social Security are getting awfully confusing. The Democrats say Republicans want to "privatize" the program, but the Republicans deny it. A few Republicans even say it's the Democrats who really support privatization. The only thing everyone seems to agree on is that "privatization" is a bad thing.

For the last five years, "privatization" has been debated in Washington. Supporters and opponents alike used the term to refer to plans that would allow people to invest some of their Social Security contributions for themselves. In 2000, George W. Bush became the first major-party nominee to support such a plan. He has not backed off from it as president. In January, a commission he appointed made the case for private investment accounts and outlined three reform options.

The anti-privatization rhetoric that pervades the current campaign may lead people to think that President Bush's idea is now dead. It's not. True, a few Republicans have disavowed private accounts. New Jersey Senate candidate Doug Forrester supported them in the primary, but has now flip-flopped. Four House candidates have come out against private accounts, too. Florida congressman John Mica signed a no-private-account pledge as part of his re-election campaign, but has since disavowed the disavowal (flop-flipped?).

But that's about it for defections. Most Republican politicians continue to support private accounts — all they've repudiated is the word "privatization." A late-August memo from the Republicans' House campaign committee explained: The P-word "elicits negative reactions among seniors because it carries connotations of dismantling the publicly run Social Security system." But those connotations are misleading. Even if Social Security were reformed to include private accounts, it would continue to be run by the federal government.

The memo made a strong case for ditching the word "privatization." It was dishonest, however, in pretending that the word was the invention of Democratic spinners: Republicans had used it too.

The word-change certainly has the Democrats hopping mad. They consider Social Security their strongest issue. They have won several midterm elections over the last generation by accusing Republicans of wanting to shred the program. Polls show that the public still trusts the Democrats more than the Republicans on Social Security. Democrats expected their advantage to grow in a year of corporate scandals and sliding stock prices. So sure were Democrats that the issue would help them that they even used it in the South Carolina governor's race, trashing Republican candidate Mark Sanford for supporting private accounts — despite the fact that governors can't do anything about Social Security.

But bashing Republicans on Social Security hasn't worked as well for the Democrats as they had hoped. They have gotten bogged down in a debate over the meaning of "privatization." They're spending their time establishing the Republicans' position rather than criticizing it.

The word-change, in other words, has been successful. The pro-private-account, anti-"privatization" Republicans are doing just fine. Shelley Moore Capito, a West Virginia Republican congressman whom the Democrats have targeted for defeat, is now ahead of her opponent even though she's for private accounts. Adam Taff, who's for private accounts, is putting up a strong challenge to Kansas Democratic congressman Dennis Moore. John Kline, who's trying to unseat Minnesota Democrat Bill Luther, has signed a pledge to support private accounts. The three Senate candidates who have the greatest chance of unseating incumbent Democrats — Jim Talent in Missouri, Norm Coleman in Minnesota, and John Thune in South Dakota — all favor private accounts.

Some Republican candidates have even gone on offense on Social Security. Thune criticizes his Democratic opponent, Sen. Tim Johnson, for having supported government-directed investment of the Social Security trust fund when President Clinton floated the idea. (Thune says, confusingly, that this means that Johnson supported "privatization.") Elizabeth Dole, running for Senate in North Carolina, has taken to waving a blank sheet of paper that she says represents her opponent Erskine Bowles's plan to save Social Security. Kentucky Republican Anne Northup, an incumbent, is running ads highlighting her opponent's alternative to private accounts: benefit cuts. But probably the bravest of the reformers has been Republican congressman Pat Toomey. He is making the case for private accounts in a senior-heavy Pennsylvania district that barely re-elected him in 2000.

The chief political danger of the Republican strategy is that it could make them look dishonest — as though they had malign intentions toward Social Security but were not owning up to the fact. In the New Hampshire Senate race, currently a nail-biter, Democrat Jeanne Shaheen is trying to make this charge stick to Republican John Sununu.

The Republicans look a bit weaselly because they have been a bit weaselly — and not just in abandoning "privatization." Sununu, for example, mailed voters a letter informing them that Social Security benefits had increased every year he was in Congress. That's true, but only because the program automatically increases benefits to adjust for the cost of living — not because of anything Sununu did.

Here and there, the press has legitimately zinged the Republicans for such tactics. It has not, of course, put a spotlight on the Democrats' dishonesties, which are legion. Shaheen has an ad claiming that private accounts would benefit only "John Sununu's Wall Street campaign contributors," who "stand to make millions if people have to put their Social Security in the stock market." In all of the leading private-account proposals, investment is voluntary and not restricted to stocks.

In several races, Democrats are claiming that Republican congressmen have voted for "privatization." But those congressmen weren't voting on any reform plan. The Democrats had proposed to prohibit any funding to implement the recommendations of President Bush's Social Security commission — before the recommendations were even made. The Republicans voted no, as did 20 Democrats. That vote hardly constitutes an endorsement of privatization.

The Democrats have also touted a bogus study by two liberal academics, Peter Diamond and Peter Orszag, on the massive "benefit cuts" that private accounts would supposedly entail. The academics stacked the deck against private accounts. They didn't compare benefits under private accounts to the benefits that an unreformed Social Security can realistically be expected to pay. Instead, they compared the benefits from private accounts to the benefits that Social Security has merely promised but has no way of actually paying.

The Democrats did get some negative press when the party's website ran a cartoon showing President Bush pushing a wheelchair-bound senior citizen off a cliff (representing the sliding Dow). This was considered to be in poor taste. Nobody pointed out that the cartoon's message was also incontrovertibly untrue. The DNC argued that if President Bush's Social Security plan had been adopted when he proposed it, "the Social Security trust fund would have lost 40 percent of its value." Bush never proposed investing the Social Security trust fund in stocks, and his commission rejected the idea. He proposed letting young workers invest a portion of their Social Security taxes over the course of their working lives.

The only people who ever proposed investing the trust fund were Democrats. In the last years of the Clinton administration, Dick Gephardt, Tom Daschle, Jon Corzine, and Clinton himself suggested that the government invest the trust fund. If that had happened, the trust fund really would have declined. So if the Republicans are dissembling about what they said a few years ago, they aren't alone. But neither are they in an ideal position to make this point.

Many supporters of private accounts consider the Republican strategy too defensive. Where, they ask, is the evidence that reform is a political liability? Bush shrank the traditional Democratic advantage on entitlements by running on reform in 2000. In 2001, Republican Randy Forbes won a special House election in a difficult Virginia district following a Democratic campaign based on Social Security. And — even after a punishing stock market and corporate scandals — almost every poll shows majority support for private accounts.

The reformers' worry is not just that the Republicans are losing an opportunity to make private accounts a winning issue. They also know that most Republican senators aren't up for re-election, and that most Republican House members face only token opposition. What these congressmen know about the 2002 campaign is what they read, and if they get the false impression that Republican candidates have had to run away from private accounts to win they will be leery of supporting them.

The 2002 campaign has thus been a disheartening spectacle for reformers. But things could have been much worse. Private accounts were bound to face strong opposition this year. This is the first midterm election under a president who supports them. It's also the first midterm election in a protracted bear market since they became an issue. Under the circumstances, Republicans could easily have succumbed to the pressure to come out against private accounts. With very few exceptions, they haven't.

President Bush wants Congress to take up Social Security reform next year. Nothing that's happened in the campaign so far should dissuade him.