April 01, 2005
Tyler Cowen agrees with my plan to turn Matthew Yglesias from a philosophy major and a feuilletonist into an economist:
Marginal Revolution:: [Yglesias] truly ought to be an economist, albeit with more Milton Friedman driven into his blood (although here is his George Stigler impersonation).
The plan is going well: witness this:
Matthew Yglesias: There's a very oddly written story in The Hill which seems to suggest that Senate Democrats are going to offer an alternative Social Security plan after all. But when you peer into the details, that doesn't seem to be what's actually happening. Instead, it 'tackles low-income incentives for saving by setting up accounts at birth in which the government would deposit $500 for each newborn and $1,000 for families with below-average incomes.' That sounds like a version of the ASPIRE Act, which has always had some support from liberals (and deserves more, I think) but has very little to do with Social Security as such.
The article details some other ideas... hav[ing] to do with savings and investment policy but not with Social Security as such. I think that's... correct.... [I]t would be good to create a society in which all Americans get to be owners and investors. There's just no reason to accomplish this by phasing out Social Security. My favorite idea for strengthening savings policy is, sadly, this mind-numbingly dull one endorsed by the dull-but-worthy folks at Brookings. 'In a nutshell, the automatic 401(k) consists of changing the default option at each phase of the 401(k) savings cycle to make sound saving and investment decisions the norm, even when the worker never gets around to making a choice in the first place'...
This is very encouraging.
Only... You can't talk about your favored proposals for increasing national savings as "mind-numbingly dull." You have to write, "My favorite idea for strengthening savings is this fascinating and innovative idea out of the Brookings Institution." Only when he can write this--and mean it--will the transformation be complete! Remember: fascinating and innovative.
Posted by DeLong at April 1, 2005 07:01 AM