From today’s Washington Post:

Amid sharp attacks by the Democratic Party, several GOP incumbents and challengers are coming out against Bush’s plan for partial privatization of the popular, taxpayer-funded retirement program. Fueling the shift is the stock market’s recent plunge, which has reminded voters of the risks of investing in stocks, rather than in other financial instruments that guarantee safe but modest returns.

The president continues to call for giving workers the right to direct a portion of their Social Security payroll taxes to stocks or other investments by creating personal savings accounts. Bush first extolled the plan near the peak of the last decade’s remarkable bull market; he says Wall Street’s frequently impressive returns should boost Social Security as well as nongovernment retirement programs.

Let’s see. Economics as taught by government bureaucrats and politicians. Privatization was good when we could make the people buy into a market that was bloated beyond belief, because the people who had money in the market could then sell stock and realize their profits. Privatization is now bad because people who aren’t in the market could buy into a more rationally priced market while earlier adopters will have to (gasp) realize losses.

Economics in the real world (or at least in Chuckie’s world 3000 miles away from DC). Buying low and selling high is better. Greater risk should correspond to greater possible reward. If privatization made sense before, it still makes sense now (and that means right now, while there are still bargains to be had out there).

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