More Social Insecurity

Krugman:

There is, by the way, a precedent for Bush-style privatization. One major reason for Argentina's rapid debt buildup in the 1990's was a pension reform involving a switch to individual accounts - a switch that President Carlos Menem, like President Bush, decided to finance with borrowing rather than taxes. So Mr. Bush intends to emulate a plan that helped set the stage for Argentina's economic crisis.

If Mr. Bush were to say in plain English that his plan to solve our fiscal problems is to borrow trillions, put the money into stocks and hope for the best, everyone would denounce that plan as the height of irresponsibility. The fact that this plan has an elaborate disguise, one that would add considerably to its costs, makes it worse.

And maybe the fact that serious financial experts, the sort qualified to be Treasury secretary, understand all this is the reason why John Snow has just been reappointed.

And Bush made it fairly clear that borrowing is going to be the way he goes, rejecting the idea of raising taxes on higher income workers:

Rep. Robert T. Matsui (D-Sacramento) said Bush had painted himself into a corner on Social Security. "The only thing he does not rule out is massive increases in the debt, but that would be a disaster not just for Social Security but for the economy," Matsui said. A debt increase could put upward pressure on interest rates and slow the economy.

Sounds like a Bush plan to me.