Commentary by Pete du Pont

Host intro: sometimes people get so caught up in partisan politics they forget to ask simple questions -- like, "will it work?" Commentator Pete du Pont of the National Center for Policy Analysis wanted to be sure he wasn't making that mistake.

James Glassman is a respected financial writer. I asked him a question for my online magazine because it pertains to the hottest policy debate of the year: privatizing Social Security, and letting people, not government, invest their retirement funds.

The question: is the market too risky for Social Security investors?

Because if it is, all the private sector rhetoric in the world is meaningless if you lose your shirt. If that happens, the puny 1.9 percent return Social Security provides starts to look pretty appealing.

Here's what Glassman said.

First, nobody has to be a financial wizard. Banks and mutual funds have helped Americans grow their nest eggs for years with IRAs and other plans.

The second question is the big one: is the market too risky?

In the short term, yes. But people don't invest for retirement in the short term. In the long term, since 1802 -- that's right, 1802 -- the real return after inflation from stocks is 8.3 percent. From 1926 to 1992, including the crash and the depression, it was 8.6 percent.

In other words, for any balanced portfolio held over time, risk all but vanishes.

Now, let's privatize.

Those are my ideas. And at the NCPA, we know ideas can change the world. I'm Pete du Pont, and I'll see you tomorrow.

Host outro: Tomorrow, Pete du Pont injects a little restraint into the heated debate over immigration.

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