Published: October 14, 2006 06:44 pm      

Third man takes on the third rail

Libertarian advocates eventually getting rid of Social Security

The back and forth between 9th District congressional candidates — specifically incumbent Republican Mike Sodrel and Democratic challenger Baron Hill — has been going on for weeks.

The primary mode of attack: Negative TV ads, mysterious videos on youtube.com and both sides accusing each other of backing privatization of Social Security in some way, shape or form.

Hill says he’s against it, but a video from a 2002 forum has surfaced in which Hill responds to a question saying he likes the idea of the government doing investing.

Sodrel says he’s against it, but he openly endorses a plan that would allow younger workers to voluntarily invest some of their Social Security money into the stock market.

But with all the barbs being traded Libertarian candidate Eric Schansberg recently weighed in on the debate.

He openly advocates reform of the Social Security system. He says preserve it for the elderly, but transition away from it for those who will retire later.

The longterm answer is getting rid of the program, Schansberg said. However, he said, the country has to keep the commitment its made to retirees so it requires a transition away from the status quo to a better arrangement in which younger people get less and less of Social Security.

One formula he suggested was that 55-year-olds get 75 percent; 45-year-olds get 50 percent; and 35-year-olds get 25 percent and on down. “One would have to wrestle with the numbers,” he said.

Almost all policy analysts argue that Social Security is in trouble financially, Schansberg said.

He calls Social Security a troubling policy in that it provides a low average rate of return of 1.2 percent after inflation. And he points out that it provides a negative rate of return for African-Americans who have a statistically shorter lifespan and is not an asset that a retiree owns.

“This is standard practice for my opponents,” he said, “treating difficult issues like hot potatoes and opportunities to score cheap political points — rather than engaging in useful discussions on an important issue.”

Both Sodrel and Hill have embraced privatization to some degree in the past, he said. “But they’re scared to use the ‘p’ word; they’re more worried about getting elected than in working to change a deeply flawed policy.”

With the impending retirement of the baby-boomers, he feels changes must be made to the system - whether dramatically increasing payroll taxes, lowering benefits, or increasing the retirement age.