For years, President Bush has spoken boldly of an America where people take ownership of their retirement and health-care dollars, making market-based choices that override the inefficiencies and political motives of Big Government. But even after a two-month stump campaign, the Bush plan for private Social Security accounts is sputtering. And it's bound to get worse as the Administration puts more detail behind the Ownership Society rhetoric. Just look at the cool reaction to the progressive indexing proposal for Social Security that the Administration unveiled on Apr. 28. It would allow poorer workers to maintain current benefit levels when they retire, but richer workers would get far less than today's payout levels. High returns in private accounts could make up some of that shortfall, but there's no guarantee. And for many Americans unsettled by growing uncertainty in the employment and investment markets, introducing risk into Social Security smells of sacrifice -- a word politicians use at their peril.
The real argument here is over the very role of government. Should Washington be a narrow institution of last resort, concerned solely with defense and providing a collection of basic services, or should it have a broader mandate to advance the overall welfare of American citizens? Or something smack in the middle?
That debate has serious philosophical -- and financial -- implications for the nation, so it certainly merits serious public discussion. But by framing his Ownership Society pitch as a sort of no-pain, all-gain way for Americans to feast on the market riches so associated with the late 1990s, Bush turned the discussion away from big ideas such as self-reliance or personal control and into a referendum on the best way for Americans to maximize their "return" from government. That handed the public a too-easy choice: retaining the guaranteed "returns" of the entitlement programs that they already know and love.
That's a shame, not because the privatization program had particular merit but because the larger issues that a more coherent advocacy from the Bush camp could have brought to the national debate -- using means tests to set benefit levels for Social Security, for example -- were never adequately articulated or refuted. Instead, President Bush proved that a politician can indeed touch the so-called third rail of American politics and live. Too bad it may not have been worth the trouble.