Yesterday, I criticized David Frum’s attempt to compare Social Security private accounts to the individual mandate in President Obama’s national health care law. In a response, Frum continues to distort what libertarians and conservatives were actually proposing on Social Security.
As I noted, market-based reform proposals centered on giving individuals the choice of remaining in the current Social Security system or diverting their payroll taxes to individual accounts. Frum said I was “missing the point” because libertarians and conservatives “have long urged a much bolder move: direct investment by savers in retirement accounts that they would actually own, as a substitute for the current Social Security system.”
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He notes a 2005 piece by Cato Vice President David Boaz. But reading beyond the part Frum quotes, Boaz’s piece actually backs up my point. At the time, Boaz wrote:
This would represent a huge expansion of freedom over the current state of affairs in which individuals don’t have any choice but to stay within the financially troubled government system.
Even if everybody chose to go into personal accounts over time, it still wouldn’t present the same constitutional questions that are at issue in the case challenging the individual mandate. Social Security is justified under the government’s taxing power because the government collects taxes to pay for benefits.
Though it’s really hard to compare the mandate to retirement accounts, to devise something remotely parallel it would have to look something like this: Social Security is abolished and government passes a new law that says everybody must buy a retirement account or be hit with a penalty. The reason everybody would have to buy an account is so young workers could drive up stock prices to boost the value of investments made by current retirees. And the government argues that because everybody gets old at some point, the Commerce Clause allows Congress to force individuals to purchase retirement accounts.
That’s totally different than a Social Security proposal that would represent more choice relative to the status quo and that would be pursued through the government’s taxing power.
Frum also responded to another part of my post in which I wrote that if liberals wanted to have a debate over enacting a massive tax increase to pay for a constitutional single-payer health care system, I’d be happy to have a debate about it. He writes that, “Klein and other Obamacare opponents want to force the choice that healthcare reform means Medicare or nothing, feeling very confident that Americans will forever and always choose ‘nothing,’ at least for the under 65s.”
Actually, that isn’t my point at all. Health care reform should be about bringing down costs, and there are two competing visions for how to accomplish that. The liberal idea is that the market doesn’t work in health care, so more government intervention and centralized cost-cutting decisions are required. The conservative vision is that government meddling is preventing the formation of a true free market in health care, so we need to remove government barriers and expand choice and competition so that consumers can send signals that will result in lower costs and improved quality.
I’d love to have that debate, but first the unconstitutional Obamacare must be knocked out of the way. Hopefully, the Supreme Court will do the right thing.
