What do people most look for in a presidential candidate? Some may look for decisive leadership, while others want integrity or vision. A number of voters want someone with a sense of optimism and some just say they want the guy with the best hairdo.
The trait that many voters overlook each election year is trust. The question is not only whether you trust the politician, but whether he or she trusts you.
Sen. John Kerry has made it clear: He doesn’t trust anyone but the federal government. At least not to prudently save, spend or invest the massive amount of money that the workers of this country pay in Social Security taxes.
Kerry was quoted in the St. Paul Pioneer Press on Sept. 23, 2004 as saying, “Let me make this clear. I will never privatize Social Security.” Of course Kerry would never come to St. Thomas and say that. According to the Cato Institute, 83% of young people support privatization.
Kerry recently addressed a group of seniors in Florida on the topic of Social Security. Everyone knows that since all seniors do is vote and watch Matlock, they are important to politicians. Of course, it is a gross exaggeration to say that seniors only do two things but it is a fact that America’s seniors are far more represented at the poles than her youth. So, as usual, Kerry is pandering to those who will help him most politically.
But, regardless of politics, one must ask the question: Is Kerry’s position against the privatization of Social Security beneficial to anyone? The first step to answering this question is to understand the facts and myths surrounding personal retirement accounts or the privatization of Social Security.
Remember Ben Franklin’s saying, “There are only two things sure in life, death and taxes.” At least death never gets any worse. Taxes, however, are something created and controlled by man. One of the taxes that workers pay is FICA or Social Security.
President Bush and Congressional Republicans have proposed that workers should have the option to invest a portion of the FICA taxes they pay into a personalized account. Option is the key word here; Bush’s plan will not force anyone to do anything new. If someone feels that the federal government would use his or her money better than they will, then by all means they can opt out of personal accounts.
Taxpayers who choose personal accounts would have only low risk options for their money like mutual funds. These accounts, proposed by the President, would be the personal property of the taxpayer and could not be touched by the government. Privatization would be a giant step forward in personal rights and responsibilities for every American. Every citizen who works and pays taxes would have more control over their own lives in an area where the federal government now runs the show.
President Bush and the congressmen who support personal accounts believe that we know how to best use our money and are therefore trying to give taxpayers more of their own money back.
In fact, even the most recent winner of the Nobel Prize in economics, 63-year-old American Edward Prescott, is an advocate of privatization. On the contrary, John Kerry, along with his friends Hillary Clinton and Ted Kennedy, are, not surprisingly, standing in the way of individual liberty.
John Kerry might tell you that if the government pursued a plan of privatization, which he would never agree to, your grandparents would be destitute, Matlockless, in a gutter, splitting their pills and eating out of a trash can. Not true! The Cato Institute’s study on privatization shows that under the President’s plan, the government would not touch a cent of the money that all senior citizens or workers approaching the retirement age would get from the Social Security Trust Fund. Their benefits would not be cut and the retirement age would not be raised.
Next, an opponent of privatization like John Kerry might tell you that privatization will hurt low-income and minority workers. Thus, anyone who supports the plan is elitist, uncompassionate, insensitive, and downright nasty. In actuality, letting low-income workers and minorities keep more of the money they earn is not only more fair than the current system, but more beneficial to them.
Many low-income families, as John Edwards has told us a few million times, don’t have any money left after paying their bills. Under privatization, all these low-income families would have extra money every paycheck to invest in their future.
President Bush’s plan helps minorities just as much as low income workers. According to Gallop, one out of every three African Americans will pay into Social Security and die before they collect the benefits. Under privatization, the money earned and invested would be that worker’s asset and could be passed down to other family members. No longer would people work and pay taxes for years only to tragically die and not be able to pass down their benefits to their family.
All the anti-privatization scare tactics won’t work on people who are informed. What Kerry and Clinton and Uncle Teddy really want is the federal government to have as much money of yours as possible (why else do you think they vote against Bush’s tax cuts?).
If taxpayers get some of their FICA tax back to invest in their retirement, the government would have less money to spend on vital projects like a $225,000 new swimming pool in Nevada. The old swimming pool’s drain was clogged by tad poles in the 1950’s and forthcoming Congressman, Jim Gibbons, “couldn’t think of a more important thing” to spend $225,000 on than a pool.
A common myth is that all FICA taxes collected go into a “lockbox.” In actuality, they go into the general fund, which Congress uses for urgent projects like pools in Nevada. Warning: The money you pay into the federal government may be used for Social Security or tadpole extermination, whichever seems to be more important at the time.
Finally, studies show that privatization can and will work. The Cato Institute reports that more than 20 countries have done something similar with success. A study by Andrew Briggs of the Cato Institute shows that “a minimum wage worker investing only the retirement portion of his payroll taxes (in a personal account) would amass $358,000 over 45 years” (using the stock market average since 1800 and calculated in 1999 dollars).
The average monthly income of that worker when he or she retires will be $1,200 in the personal account plan and $750 in the current plan that Kerry loves so much. Pools in Nevada are great, but I’ll take the $358,000.