Wednesday, July 29, 1998

Public grasps private Social Security option

A newspaper's poll shows a majority of Americans believe it a good idea to invest some of their Social Security taxes in private accounts, but President Clinton didn't sound so sure himself during a town meeting in Albuquerque, N.M.

"What are the risks?" he asked. "What are the dangers?"

Minimal, Mr. President. Next to nothing.

Certainly, the dangers of investing some Social Security contributions in balanced portfolios of stocks and bonds would be far less than doing nothing and hoping everything turns out OK or of hiking regressive payroll taxes and cutting benefits, vainly hoping you won't have to repeat yourself as the government has done so often before.

Actually, the president has come some distance on this, from a time he would hardly talk about partial privatization to a time when he concedes the idea is interesting and that the stock market has performed marvels in recent years. The public - showing itself ahead of all but the most progressive politicians - has come further. A USA Today poll says two-thirds favor private accounts.

The worry the president expressed in Albuquerque was that the stock market would take dips - and it will. But over time, it returns an average of 10 percent a year, and it won't face prolonged disaster unless the whole economy does.

The terrific thing about private accounts is that they will provide a means of raising money for the system other than reliance solely on tax cuts, deficit spending or benefit cuts.

It's true that converting to the method has its costs, but they are not so high as any other method of salvaging Social Security with benefits largely intact.

Now that the public knows all of this, will their leaders be far behind?