[PEN-L:28529] privatizing social security

["Devine, James" <jdevine@xxxxxxx>]

Title: privatizing social security

Paul Krugman:>Who would benefit directly from the creation of "personal accounts" under Social Security [that Dubya still proposes]? Those personal accounts won't be like personal stock portfolios. The Social Security Administration can't and won't become a stockbroker for 130 million clients, most of them with quite small accounts. Instead it's likely that a privatization scheme would require individuals to invest with one of a handful of designated private investment funds.

>That would mean enormous commissions for the managers of those funds. And those who would be likely to benefit showed their appreciation, in advance: During the 2000 election, according to opensecrets.org, campaign contributors in the two categories labeled "securities and investment" and "miscellaneous finance" (basically individual wheeler-dealers) gave Mr. Bush almost six times as much as they gave Al Gore.<

Here's a contradiction: the Repugs hate "trial lawyers" and often call for "tort reform" to declaw them. But this kind of privatization scheme sounds like it would create a lot of opportunities for trial lawyers to sue private investment funds that abuse their clients' funds. The solution, of course, would be to push tort reform through, but that isn't happening.

JD