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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Wayners who wrote (677748)	3/31/2005 3:35:48 PM
From: DuckTapeSunroof	Read Replies (1) \| Respond to of 769667

"I don't know, wouldn't shifting the notes whatever they are from an account controlled by the Govt to individual accounts be essentially the same system as today?" No. The plan calls for IMMEDIATELY starting to put real TIPS bonds in INDIVIDUAL accounts. (Even Bush's proposal only wanted to start some 'years' in the future, and it wanted to 'claw-back' some of the interest....) "If the Govt put real assets into the accounts, I'd be all for it." Yep: REAL TIPS BONDS, accruing interest and all... not just 'book-entry' obligations into a master SS fund like they are doing now. ==================================================== ...Pollock (a conservative economist who presented this proposal at the American Enterprise Institute) takes a different tack. As personal accounts are envisioned, most people will see them as too risky and complicated. And the government's upfront borrowing costs are simply too high, he said. The federal government enjoys a substantial surplus of Social Security taxes, and that surplus is used to finance other government programs. For every dollar "borrowed" from Social Security, the Social Security system receives the equivalent in the form of a Treasury bond. Rather than have those bonds go to the Social Security Administration, Pollock suggests they go into private accounts, in the form of inflation-indexed Treasury bonds, or TIPS. After some number of years, the bonds could be traded for other investments, like private-sector bonds or stocks. Under the plan, there would be no huge, upfront borrowing costs for the government. Social Security taxes would remain dedicated to Social Security, answering the Democrats' loudest objection. And individuals nervous about private financial markets would be offered accounts with perhaps the safest investment vehicle on offer. "The fundamental idea of long-term savings accounts, which really do generate assets for ordinary people, that's a great idea," Pollock said. "The question is, can you design a system that works?" ========================================= Message 21180422 aei.org