Leading Economists and Wall Street Speak Out on Social Security

From Holden:

One characterizes Chimpy’s plan as undesirable, another calls it a “bribe”. Why don’t we just call his plan a miserable failure and be done with it?

Princeton economist Alan Blinder, a former vice chairman of the Federal Reserve, said that while the outlines of Bush’s plan were becoming clear, the package was not desirable.

“This would be a piece of a program to expose people to more and more risk. There are millions of Americans who have no desire and no ability to gamble on the financial markets, and they shouldn’t be pushed to.”


[S]ome analysts say the administration also views personal accounts as politically necessary to persuade younger workers to swallow a substantial reduction in promised future benefits. The prospect of greater control and higher returns provided by private accounts might seem like an acceptable trade-off, in this view.

“It’s a bribe to get the real reform, which is cutting future benefits to levels they can manage,” said Lehman Brothers’ Harris. “What they’re doing is making a bargain with the baby boomers. The privatization is a sugar-coating to get the broader reform passed.”