February 09, 2005
Allan Sloan of Newsweek Adopts the Democratic Position on Social Security Reform
MSNBC - Social Security: A Daring Leap : "I'm in favor of private accounts constructed along the lines that Bush suggested. But the accounts ought to be in addition to the basic benefit, not as a replacement for about half of it.... If the president really wants to fix Social Security rather than pick a political fight—and the Democrats feel the same—it wouldn't be difficult. They'd compromise by putting more money into the system by raising wage taxes a tad, taking less out by increasing the retirement age and trimming benefit formulas and setting up private accounts funded by wage earners, not by government borrowings. Put a few willing negotiators in a room and a deal's done in a month. I won't hold my breath, though."
The curious thing is that Sloan pretends that his position is in some way different from that of the Democratic mainstream as found in, say, Diamond-Orszag. Sloan writes things like "Democrats are crazy to oppose private accounts.... FDR's been dead for 60 years. The world has changed." But I haven't met a Democrat who is opposed to private accounts. Democrats are opposed to private accounts funded by diverting payroll taxes from the defined-benefit system. And, indeed, many Republicans are opposed--at least in private--to payroll tax diversion too.
Posted by DeLong at February 9, 2005 07:48 AM