Social Security

The principal problem with Bush's Social Security scheme is that it makes unjustified assumptions about the future. Notice that the basis for diverting a portion of FICA taxes into "personal" accounts for investment in the market is that "over time, the market has always gone up." This alone should be a good clue that it won't continue to go up from here. The present SS scheme makes no assumptions about the future. So far, the needs for additional monies have been satisfied by incremental adjustments in the tax rate and the salary cap. The only assumption about the future is a bias assumption toward the immediate future. Bush wants us to make assumptions about 50 years hence, and believe projections for that span of time. The Soviet Union failed partly because it couldn't successfully project five years into the future. There is a lesson to be learned there.