At last, an honest assessment of why you need government to do nearly everything for you … you are too stupid to do it for yourself. But there is even more to this assessment and call for increased Social Security benefits by Paul Krugman.
Read his words carefully. His assumptions and criticisms are insulting and misleading. What they are saying is turn over your life and your future security to government because you are too busy, too gullible and too short-sighted to manage your life.
I wonder how society survived this long without government and progressive/liberals managing our lives?
Let’s be clear, while the decline in pensions is real, the truth is the majority of Americans never, ever had a pension. 401k plans are not nearly as good as a defined benefit pension, but they are a darn site better than no pension or no tax efficient saving vehicle. Krugman is rather condescending with his “without requiring that they (that’s you by the way) show an inhuman ability to think decades ahead and be investment whizzes as well.” Thinking ahead is quite easy and you don’t have to be a whizz to save and invest for retirement.
Krugman is setting the stage for the 2016 presidential campaign. You poor, average Americans are basically incompetent in so many ways, you need the elites to save you from your own stupidity. Here we go, “Everyday Americans need a champion. And I want to be that champion,” Mrs. Clinton said.
Sadly, there is an element of truth in their claims, but not because things don’t work and certainly the solution is not government running more of everyday Americans lives, but rather the solution is encouraging more personal responsibility, more education so planning your retirement (and other life issues) is not an inhuman task. In other words, once again the left is not trying to solve fundamental problems, but rather just jumps to the government do it all solution.
Maybe we wouldn’t need Social Security if ordinary people really were the perfectly rational, farsighted agents economists like to assume in their models (and right-wingers like to assume in their propaganda). In an idealized world, 25-year-old workers would base their decisions about how much to save on a realistic assessment of what they will need to live comfortably when they’re in their 70s. They’d also be smart and sophisticated in how they invested those savings, carefully seeking the best trade-offs between risk and return.
In the real world, however, many and arguably most working Americans are saving much too little for their retirement. They’re also investing these savings badly. For example, a recent White House report found that Americans are losing billions each year thanks to investment advisers trying to maximize their own fees rather than their clients’ welfare.
You might be tempted to say that if workers save too little and invest badly, it’s their own fault. But people have jobs and children, and they must cope with all the crises of life. It’s unfair to expect them to be expert investors, too. In any case, the economy is supposed to work for real people leading real lives; it shouldn’t be an obstacle course only a few can navigate.
And in the real world of retirement, Social Security is a shining example of a system that works. It’s simple and clean, with low operating costs and minimal bureaucracy. It provides older Americans who worked hard all their lives with a chance of living decently in retirement, without requiring that they show an inhuman ability to think decades ahead and be investment whizzes as well. The only problem is that the decline of private pensions, and their replacement with inadequate 401(k)-type plans, has left a gap that Social Security isn’t currently big enough to fill. So why not make it bigger?