BUY LOW :

Democrats See Scandals as Chance to Attack Privatizing Social Security (ALISON MITCHELL, July 13, 2002, NY Times)

Seizing on the Wall Street scandals to press their agenda on Social Security, Democratic leaders in Congress demanded today that President Bush and his party renounce efforts to shift part of Social Security into private investment accounts.

With investor fears dragging down the stock market, Senator Tom Daschle of South Dakota, the majority leader, aimed at Mr. Bush, who advocated in his presidential campaign that workers be able to shift part of their Social Security payroll taxes into private investment accounts similar to 401k's.

"President Bush campaigned on a promise to privatize Social Security," Mr. Daschle said at a news conference. "He was very clear about it. He wanted to end Social Security as we know it.

"A lot of us thought that idea was a bad idea two years ago, when the Dow was going up every week. After what's happened to the stock market in the last few weeks, we think it's a terrible idea." [...]

About half of American households own stock. Perhaps even more important for the midterm elections, David Winston, a Republican pollster, notes that 71 percent of those who voted in House races in 2000 held stock.

Republicans seem poised to stage their usual craven retreat on Social Security. Instead they should leap on privatization with both feet. This is the time to explain that there is no ten year period in the last forty years during which stocks have declined and that we have been presented with a once in a lifetime buying opportunity. Privatize now and the entire country gets to buy in on a dip in the market and reap the windfall of its impending rise. Of course, you can imagine how fast the market would rise regardless of the fundamentals if any significant portion of social security suddenly went into the market, so, even beyond the predictable functioning of the normal business cycle, this is a self-fulfilling prophesy.

The sheer audacity of insisting that even now (yes, let's pretend that this correction is some kind of catastrophe) it is necessary to move our retirement funds into stocks will be so breathtaking to the uneducated and to the fear mongers of the Left (but I repeat myself), that it might actually be taken seriously, finally.

And what do we know, just as surely as we know that the sun will rise tomorrow? We know that, even without privatization, stocks will shortly head upwards again. It takes no great genius to intuit this; it is simply the way the world works. So while Democrats doomsday and denigrate the market, the GOP will emerge as the optimistic champions of the rising tide. It isn't often that your opponent seizes the inevitable losing side of an issue in a deathgrip and races towards a cliff, but when he does, it's wisest not to join him. We need not play Louise to the Democratic Thelma.

Democrats are on the wrong side of the entire history of the stock market; let them have that side to themselves. Run on privatization now. Make it and vouchers the focus of the Fall campaign : "Republicans trust you to make the choices that matter in your life." The pundits will perceive it as courageous and it's the right thing to do.

Posted by Orrin Judd at July 13, 2002 1:18 PM