I’ve noted previously that Social Security privatization now looks dead as a doornail. The end of the Bush era–coupled with the stock market crash–seems to have put the idea out of its misery. Los Angeles Times columnist Michael Hiltzik weighs in today with an excellent article on this issue:

They say that even the worst tragedies harbor the seed of something good. So here’s something positive in the stock market’s gruesome behavior over the last year: It may finally have driven a stake through the heart of the campaign to “fix” Social Security.

Let’s be plain about one thing: This campaign, cooked up mostly by Wall Street investment houses and conservative Republicans,was always about “fixing” Social Security the way one “fixes” a cat.

Hiltzik goes on to note (correctly) that despite its funding problems, Social Security looks much more stable than anything else going:

With any luck, the 2008 stock market crash will permanently restore Social Security’s luster. Indeed, the program looks so solid and reliable compared with every other source of retirement income — your pension, your portfolio, your house — that people ought to respond well to the idea of expanding it, in part by permitting them to put more money into their Social Security accounts to obtain better benefits.

Hiltzik also describes one actuary’s idea that Social Security actually should be expanded to cover two-thirds of retiree income needs, with funding coming from higher payroll taxes. That’s reminiscent of other ideas floating around Washington right now that call for a bigger federal role in retirement security, including the Automatic IRA and universal pensions.

Related posts:

1. Reader mailbag: Allocations, Social Security taxes and Roths
2. Bush still yearns for Social Security privatization
3. What are politicians saying about Social Security and Medicare?
4. Recession worsens outlook for Social Security, Medicare
5. Reader mailbag: Reverse mortgages, retirement income and Social Security

Tags | Social Security