A Modest Proposal

Democrats, liberals, and others (including us) have recently been attacking Bush's proposal of partially privatizing Social Security. For one, because he and his Republican allies are overstating the problem, and secondly, because private accounts are a bad idea given the risk (remember Enron?) and the transitional fees are currently unaffordable given our current defecit. But I think Democrats who think they can easily defeat the reform by stating its flaws are mistaken. You don't want to seen as anti-reform and ignoring a problem. You need to eventually state what you would do as well. Well, I'm gonna give my two cents on this issue.

My solution is to raise the payroll tax, but offset it with a income tax credit (so it's a tax shift not an increase), so we can fix the problem without changing the system at all. I don't know the concrete numbers on that, but it makes the most sense to me and I think seems pretty reasonable. At least moreso than any other conservative or liberal proposals I've heard.

See, I think you can't just make the FICA more progressive or cap payments to the wealthy as some propose, because quite frankly it's unfair. So anyway, I think I think this tax reform is the best way to gurantee solvency, while simultaneously making it more progressive (again, without being unfair). You could just use general funds to fill in the gap, but I don't think you want to mess with the idea of the thing.

SS is hands down the most popular liberal program because everyone pays into it, and everyone gets benefits. I think if you mess with that paradigm you risk changing people's perception of it, which ultimately endangers its longevity.

Also, other proposals like raising the retirement age aren't very paletable. On that one, while people are living longer, particular groups of people like African-Americans and Hispanics already don't live long enough of enjoy SS benefits as long as white or Asian retirees right now.

Anyway, I'm obviously no policy wonk, but I do think this sounds the most reasonable of any reform, and I believe more of what people are looking for right now than any drastic change.