Focus Point - O'Neill 'Fesses Up

Commentary by Pete du Pont

I'm Pete du Pont with the National Center for Policy Analysis. You know when a cabinet secretary says "If we did it this way in the private sector we'd all be in jail," it's quite an admission.

But that's just what treasury secretary Paul O'Neill said about himself and the people who run social security, acknowledging they have pension fund obligations with no assets behind them.

As O'Neill told an audience, the social security system is, in effect, an account with no money in it. On the other hand, letting workers put some of their payroll contributions into accounts that invest in stocks or bonds would be real money in real accounts. Money that could be passed on to your spouse or children. And, while O'Neill didn't mention it but could have, the very lowest-producing government bond fund would still beat social security's pathetic returns.

O'Neill, refreshingly, acknowledged what people outside government have known for years: that social security is an accounting fiction with no "fund" at all - simply the pay-as-you-go dollars of current workers. But it's nice to have it made official.

Those are my ideas, and at the NCPA we know ideas can change the world. I'm Pete du Pont. Next time, the global warming myth.