MY NEW SS REFORM ARTICLE IS UP

I missed Nato's blog for a little while since he went back to his usual blog rather than Tom's. On Oct. 11th, he voiced his common misconception:

Of note to those who feel (correctly) that Kerry's plan is not likely to actually reduce the budget deficit:

According to congressional estimates, he said the cost of the full Bush package would exceed 2.2 trillion dollars over the next decade while Kerry's plan would likely increase debt by 1.1 trillion dollars over the same period.

Another example of two poor choices. Clearly, the CBO is not going to be an organ of Democratic Party propaganda, seeing as how the GOP controls both houses and the executive. Therefore, one can be reasonably certain Kerry's plan, as profligate as it is, looks pretty good next to Bush's.

In my new article, "Land and Sea: Private Accounts, Social Security and Risk," I've got a few words on why this is misconceived:

In one of the Washington Post's more egregious misrepresentations in recent memory, a headline stated "$3 Trillion Price Tag Left Out as Bush Details His Agenda" This was picked up by blogger Andrew Sullivan as indicating that Bush's proposed second-term domestic agenda would cost $3 trillion. But if you read the article, it said something quite different. Of this $3 trillion, $1 trillion was the "cost" of the extension of the tax cut. Hmm. I probably don't have to explain to anyone that there's a difference between the government spending your money and the government not taking your money.

The other misrepresentation was more understandable. The Post, like everyone else who talks about "transition costs," claimed that if part of younger workers' payroll taxes goes into private accounts, then there will be fewer payroll taxes left over to pay current retirees, which will drain the Social Security "trust fund" (smoke-and-mirrors, that "trust fund," but never mind) and require the government to pay current retirees out of other revenues, either taxing or borrowing. This is true. But at the same time, as younger workers shift to private accounts instead of the traditional Social Security program, the government is being unburdened of future Social Security obligations. So even if the government borrows all the money it needs to pay current retirees, this will represent no increase in the government's total liabilities.

The Washington Post, then, had it completely wrong. There was actually no "price tag" at all, properly speaking, for the programs they were reporting on.