The Obama campaign has recently launched a series of ads in swings states with large elderly populations such as Florida and Pennsylvania that attacks John McCain for wanting to "gamble" with seniors' retirements. The Obama campaign's ads refer to John McCain's plan to give taxpayers the option of investing a portion of their social security in the stock market. As when George W. Bush proposed giving taxpayers the option of investing a portion of their social security in the market, the left cried "foul" with enough allies on the right to stymie any such reforms. With the temporary downturn of the market it would indeed appear foolish to let seniors squander away their retirements in risky investments. However, historically the stock market has far outperformed the social security trust fund, which is going broke soon. Thus in the long run, those seniors making the CHOICE to invest a portion of their social security in the stock market would be walking away on average with more benjamins than those opting for the current plan. Now more than ever is the time to give people the option to invest part of their social security in the stock market as such a flow of capital into the market would be great news for markets that have been battered by a mass exodus of capital from mutual funds in recent weeks. Whether you agree with the partial privatization plan or not, agree with me that something drastic and innovative must be done to reform a system that is doomed to insolvency in the coming decades. John McCain's plan: optional partial privatization that would give the markets a badly needed influx of capital. Now turning to the Obama plan....
Surprise, surprise, surprise the Obama plan on social security consists of RAISING TAXES ON THE RICH GUYS. In spite of Senator Obama's promises of "hope" and "change" I see nothing promising or innovative about his social security plan. Obama's plan consists of extending the payroll tax (that funds social security) to include all income over 250,000. Currently, only income up to 250,000 is taxed, with people receiving proportionally roughly what they put into the system. Social Security has been such a popular program for so long because it is "contributory," meaning that everyone pays and everyone benefits based on what they pay. Barack Obama's plan will change the nature of this program from that of a retirement plan bound for bankruptcy into that of a socialist wealth redistribution scheme that is also bound for bankruptcy. The additional revenue into social security from Obama's plan will only extend the solvency of the program for an estimated three years. The changing population demographic with retiring baby boomers that is straining Social Security requires an innovative solution to a complex problem: Obama's solution of saddling the rich with more taxes that will do nothing but postpone the sytem's failure for a few more years is hardly innovative: another example of his commitment to the old failed policies of big government, tax and spend liberalism. John McCain's plan will restructure the system into one that on average will increase returns dramatically and take much of the strain off the cash strapped federal government. I had a discussion with a liberal today who warned that partial privatization of Social Security was a bad idea because people are stupid and cannot be trusted to invest their money wisely. I have heard this argument time and time again from liberals. First of all, it would be easy to open up investment only to safe index type funds that will not allow people to gamble their retirements in highly risky investments. Second of all, this liberal argument underscores the fundamental ideological difference between liberals and conservatives on the economy: liberals believe that Washington can spend Americans' money better than the people who earned it while conservatives would trust the people with their own money. It's never felt so good to be a Republican.......
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