Naturally our “sisters” at the National Organization for Women, Bush-loathers all, oppose the Bush administration’s plan to privatize Social Security, saving it from bankruptcy (by 2012, just seven years from now, the government will be paying out more in benefits than it takes in) and reconstituting it as a genuine savings plan rather than the income-transfer Ponzi scheme that it is today.

The NOW strategy is–guess what–sex-based scare tactics. The latest Social Security press release from NOW president Kim Gandy reads ominously: “Privatizing Social Security Will Hurt Women.” For one thing, Gandy claims “Social Security is NOT in trouble”–it needs only to be “strengthened” (that’s NOW-ese for “propped up with a huge tax increase”). Then Gandy goes on to list three reasons why we have to keep the current system tottering along no matter what the cost to the low-wage younger workers who must be bled white to keep the Ponzi guys in business):

“Women are far less likely than men to have a pension from their jobs, so Social Security is likely to be their primary retirement income.”

“Even if they have supplemental savings, women live longer on average than men, so their savings run out sooner — and the majority of the very elderly are women whose only source of support is social security.”

“Most women earn less than $25,000 per year — so the administrative costs of such a small private account would eat up most, if not all, of the earnings each year. In Chile, where accounts are privatized, administrative costs consume not only the interest income but as much as one-half of the total contribution.”

I dunno about Chile, but most of what Gandy says about the Bush plan are completely untrue (and note the NOW assumptions: that all women are so oppressed and/or stupid that they never will be able to or willing to set up retirement plans–which ignores the millions of U.S. female workers who are wisely investing in IRAs and 401k plans even as I write).

For some facts about the Bush plan, click this information page at the Cato Institute’s website:

1. Older workers’ benefits will not be cut. Says Cato:

“Nearly all plans for Social Security reform would exempt workers nearing retirement from any changes made to the program. Generally, that is defined as workers at least 50 or 55 years old. Proposals to allow workers to privately invest a portion of their Social Security taxes through individual accounts are designed to create a better system for your children and grandchildren. Your benefits would be unaffected. In fact, by helping to solve Social Security’s financial problems, individual accounts may prevent benefit cuts in the future that might otherwise have reduced your benefits.”

2. Even low-income earners will reap more than from the current system. Says Cato:

“Through the power of compound interest, all workers would be able to accumulate substantial savings. Take, for example, a 28-year-old worker making $13,500 per year and paying $1,674 in Social Security tax. If she invested in a conservative savings program that earned just a 4 percent return, she would accrue $177,147 by age 67. That amounts to a monthly benefit of $1,243-$400 more per month than the benefits promised by Social Security….

“Workers would own their savings. Therefore, if an individual died before reaching retirement, he could leave his accumulated savings to family members. That is important to low-wage workers whose life expectancy is shorter than that of the wealthy.”

3. Younger workers who have already paid substantial Social Security taxes will not be penalized. Says Cato:

“Social Security is now such a bad deal for younger workers that up until about age 40 or 45 they will probably still be better off in the private sector even without the refund of any past taxes, as long as they no longer have to pay into Social Security in the future and can use all those funds for their own investment accounts instead. However, most personal account plans would compensate you for your past taxes. Ideally, this would involve calculating the proportion of lifetime taxes the worker and his employer already paid. The refund would then equal this same proportion of expected lifetime benefits, in present value terms. The worker could be given this refund in government bonds for his private retirement account. The bonds would accrue interest over the years, reaching at retirement the present value of the proportion of retirement benefits the worker should receive based on the past taxes paid. These bonds could then be partially cashed in each year to help finance the worker’s retirement benefits.”
I’ve been paying Social Security taxes myself since I got my very first job at age 18, and if I had all that money in a genuine savings account with compound interest–even a lousy, low-interest, government-run savings acoount–I’d be a wealthy woman. Instead, I’m looking at political panic in the near future in which Congress could vote to send me two tins of cat-food a month as my reward for a lifetime of paying into a system that was poorly conceived of in the first place. I can do the math on Social Security reform–why can’t Kim Gandy?