NOW and Social Security Privatization
Lisa De Pasquale
Featured Rightgrrl February 1999
Program Director, Clare Boothe Luce Policy Institute
May 15, 2000
In a recent statement on Social Security made by National Organization of (liberal) Women entitled Privatization = Poverty, President Patricia Ireland wrote, "Like most shell games, privatization is a scam. And women will likely suffer the greatest losses if it is implemented." Ireland also accuses conservatives who are revising Social Security of doing so under "an exaggerated funding crisis and in the name of reducing government."
Ireland also claims that privatization will "tear holes" in Social Security as a retirement safety net.
As with most issues NOW and Ireland address, the reality of privatization is exactly the opposite of what these radical feminists claim.
Essentially, privatization refers to establishing self-managed retirement funds using money that would normally be ear-marked for the government administered fund, Social Security. Darcy Olsen, Director of Education and Policy at Cato Institute, wrote in The Indianapolis Star, "Privatization is simply pro-worker -- it gives every one of us, particularly women who need it most, the freedom to save, to accumulate real wealth and to retire with real financial independence. Those who close their minds to the idea of investment-based accounts do a disservice to those who most need this opportunity."
According to Olsen, even a low-risk investment, such as one with only 3 or 4 percent return, will fare better than that of Social Security.
And the safety net? Olsen writes, "The wonder of privatization is that it goes beyond providing a safety net -- it gives every worker, rich or poor, male or female, the freedom to save and achieve real financial independence."
Even the Social Security Administration admits that one needs other options in order to retire comfortably: "Social Security is indeed a foundation on which they can, together with other investment options, build their financial future."
However, according to a recent poll by the 60 Plus Association (conservatives' answer to AARP) and the polling company, a plurality of registered voters think it is more likely that aliens will land on Earth than Social Security being available when they retire. The poll also found that a majority of voters think their money is safer "under the mattress" than in the hands of the federal government.
NOW talks about the "benefits under the current program that would not be available under privatization." How about the benefits under privatization? For example, retirement funds would be available to family members after one dies and one's nest egg would increase exponentially more than Social Security's returns when put into any other investment option (stock, bond, mixed).
A favorite reason given for anything NOW opposes is that it benefits the rich, especially white men, and punishes the poor, especially minorities. Yet a recent poll by Zogby International shows that minorities overwhelmingly support privatization of Social Security funds. Respondents were asked "How likely would you be to support Social Security privatization if it allowed you to take your Social Security money and invest it in a retirement account of your choosing?" Results show that 66.8 percent of women, 74.5 percent of African Americans, 89 percent of Hispanics and 90 percent of Asians were likely to support such reform. The poll also shows that support of privatization crosses all ideological, race, religious, gender, educational, age and regional lines: a majority of every group supports Social Security privatization.
So, why is NOW trying to save minorities and women from Social Security privatization? Are these and other hard-working Americans too dense to handle their retirement funds? Can they not be trusted in high-rolling world of stocks and bonds? Contrary to what NOW says, privatization (like school choice) will not do much to benefit the rich -- they already have the investment options, the accountants and the lawyers that secure their financial future.
NOW's statement on Social Security privatization is testament to this organization's dirty little secret. They don't speak for women and they don't speak for minorities. NOW speaks for the leftist government status quo. It is clear why Patricia Ireland and NOW defend the current monopoly that government has on retirement savings because -- as Ireland says -- privatization is proposed "in the name of reducing government."
This article copyright © 2000 by Lisa De Pasquale, Clare Boothe Luce Policy Institute and may not be reproduced in any form without the express written consent of its author. All rights reserved.