FOOL ME ONCE....The members of the Washington Post editorial board must be as cute as buttons. I'd like to meet them someday.

Today they come out in favor of private accounts for Social Security. Their reasoning is simple: private accounts invested in stocks should have pretty good returns, and these high returns will allow benefits to be cut enough to to bring the system closer to solvency.

As far as it goes, that's perfectly reasonable. Private account returns are highly unlikely to be the 4.6% they cite, but they'll probably be higher than 3%, and that means that investing in stocks is likely to be a good deal for retirees who make wise investment decisions. This in turn means that private accounts might be a good idea if they were "properly accounted for, tightly regulated, and honestly funded," as one critic put it.

But what are the odds? We already know the administration is pushing stealth cuts in guaranteed benefits far larger than anything the system needs. We already know their plan includes diversion of current payroll taxes, something that will weaken, not strengthen, Social Security. We already know they're planning to fund the accounts by borrowing $700 billion in the first decade alone, something that likely wipes out the supposedly high returns. We already know that the administration plan does nothing in particular to help out the half of retirees who end up making below-average investments.

In fact, what we already know is this: their plan is brought to you by the same folks who brought you 2003's prescription drug bill. What more do you need to know?

If you're a trusting soul, I guess you're willing to give them another chance — and the Post editorial board, having already been scammed several times before, is apparently willing to do this. But guess what? Six months from now they'll be writing editorials saying that what they really meant was that they supported a well-balanced, properly implemented privatization plan. Who could have known the administration would botch it so badly?

Sound familiar?

—Kevin Drum 12:35 PM Permalink | Trackbacks