Robert Samuelson argues that the Supreme Court case of Flemming v. Nestor “demolishes” Bush’s case for personal accounts. The Court held in that case that a claim on future benefits isn’t property. People don’t own their Social Security benefits. Congress can cut them at any time. Therefore, reasons Samuelson, it is not accurate to say that personal accounts merely make the government pay earlier for costs that it would have to pay eventually. It doesn’t have to pay those benefits at all.

There is substantial truth to what Samuelson is saying. The unfunded promises of Social Security aren’t exactly debts–which is why most reformers talk about them as “implicit debts” rather than explicit debts. Maybe Samuelson would say that even the modifier leaves the phrase too strong (although those promises aren’t nothing). If so, then presumably it’s wrong to talk about future benefit “cuts” as well–those future benefits don’t exist yet and aren’t obligations of the government. These terminological changes would, I think, suit Samuelson just fine. I gather that he wants to solve Social Security’s fiscal problem largely by paying less to senior citizens–today’s and tomorrow’s.

But most reformers are talking about a package deal that includes both personal accounts and a cost-saving change in the way benefits are calculated. Obviously the package doesn’t assume that future benefits are set in concrete. The assumptions rather are 1) that there is no free lunch: the growth of benefits has to be moderated and 2) that personal accounts will soften the blow for tomorrow’s retirees. The personal accounts don’t just shift costs from the future to the present. They’re part of a deal that reduces those costs while shifting some of them.

One of the arguments for personal accounts is that they are a way of pre-funding retirements. Precisely because the accounts would be the account-holders’ property, it would be more difficult for the government to divert this funding to pay for other government operations the way they have diverted the Social Security surplus. The accounts would function as secure lockboxes. Flemming v. Nestor strengthens that argument for the accounts–which is why proponents of personal accounts have been far more likely to bring up that case than opponents have over the last ten years.