Skip to main content

Forbes Pumps Up Social Security Issue, and His Image

Will a presidential wannabe's initiative draw the Duke of 2000 into a debate he'd rather avoid?

Despite all the talk about how Hollywood and Washington have a lot in common, in one regard they're complete opposites. In Hollywood, when a star hits it big, a demand is created for lookalike actors. Young men start trying to walk, talk and look just like the No. 1 box-office draw. But in Washington when a politician hits it big -- at least in the Presidential primaries -- everyone tries to look as different as possible. Right now, and for the foreseeable future, this presents a challenge for most Republican presidential wannabes, because

George W. Bush

is the

John Wayne

of political showbiz, and he has mastered the role of the Quiet Man.

For the remaining 10 or so Republican candidates, this leaves a lot of other roles to pursue, and they are all doing their best to look like

Fred Astaire


Frank Sinatra

or even


-- just so long as they provide a clear alternative to the Duke of 2000.

Elizabeth Dole

has the easiest job: Biology alone offers a formidable contrast. As long as the war in Kosovo lasts,

John McCain

is the war hero candidate, willing to pay any price to avoid making the mistakes of the past. Former vice president

Scroll to Continue

TheStreet Recommends

Dan Quayle

says he is the "tested" conservative, as opposed to the untested son of his former boss.

Gary Bauer

is the default candidate of Religious Righters unwilling to throw the dice on another Bush.

And then there's

Steve Forbes

: the "issues candidate." In some ways it is a reprise role. In 1996, he played the role of the nerdy and bookish ideological spoiler. A deep-pocketed businessman who couldn't persuade an authentic supply-sider politician to run on his issues (ironically, his choice was the eventual 1996 VP candidate

Jack Kemp

), Forbes took to the race himself and ran a surprisingly serious effort. As the candidate for "Hope, Growth, and Opportunity," he spent a remarkable amount of time and money attacking his opponent. And he managed to popularize a 15% flat tax, making himself the

Martin Luther

of economic conservatives and libertarians.

This time, Forbes is much more serious. He's hiring political pros the way


buys computer programmers -- just to keep them off the market whether they are needed or not. And he's expanded his message to appeal beyond the lower-taxes-will-solve-all-your-problems crowd. Many in the press who are inclined to think that talking with the Religious Right should rank with foreign birth or a felony conviction as Constitutional disqualifiers for the presidency have made a great deal of noise about Forbes' rapprochement with the conservative, "pro-life" wing of the party. But the reality is that Forbes is still the closest thing the Libertarians have to a standard-bearer (except of course the Libertarian candidate who will be selected at the next

Star Trek


To prove it, this week he offered the most detailed and radical proposal for dealing with Social Security since

Barry Goldwater

suggested it should be voluntary. Clasping both hands firmly on the issue formerly known as the "third rail" of American politics, Forbes' plan would allow workers to invest most of their payroll taxes in the stock market.

The Ponzi scheme quality of Social Security is now a familiar subplot in the unraveling narrative of the welfare state. Currently, workers and employers equally pay a combined 12.4% in payroll taxes to the Social Security trust fund, which covers the benefits of current recipients (This is a double fiction; the trust fund is the accounting equivalent of a stack of IOUs. And, in macroeconomic terms, the employer portion is still coming out of my, er, the worker's hide). The demographic logic of the current system starts to unravel around 2014 when retiring Baby Boomers draw down the trust fund into the red. By 2034, there will be nothing left.

Under the Forbes plan (which is intentionally very similar to the Chilean pension system), people could set aside up to two-thirds of the payroll tax into their own "personal retirement accounts." Workers could invest those funds in government-approved stocks and bonds, and the interest-bearing accounts would be tax-free forever. Unlike the pyramid structure of the current system, workers could pass unused assets on to their heirs when they die. Older people and current Social Security recipients are grandfathered under the Forbes plan, and younger workers would have the choice of opting into the system.

A Chance to Drive Another Issue

"It's going to be like the flat tax in 1996. It's going to allow Forbes to drive the issues in the primaries," says Michael Tanner, a scholar at the rabidly libertarian

Cato Institute

in Washington and an informal member of the Forbes Social Security brain trust. "All of the other candidates will need to stake their own positions on Social Security." Tanner is probably right that candidates can't avoid answering the question, "What do you think should be done about Social Security?" But whether or not it will light the nighttime sky of Manchester, N.H., with the torches of privatization zealots remains to be seen.

Forbes plan tests the notion that Social Security is the third rail of American politics. When presented in the abstract (without any messy details about how to pay for the transition), privatization seems to have some political appeal. For example, Harvard's Kennedy School, the Kaiser Foundation, and

National Public Radio

recently ran a major opinion survey on attitudes about Social Security. Presumably to their dismay, NPR discovered that about two-thirds of Americans favor partial privatization of Social Security. While older Americans mostly dislike the idea, a whopping 71% of those 18 to 29 years old are behind privatization, largely because they're inclined believe Social Security won't be there when they retire.

Other Presidential candidates have offered theoretical approval of some kind of privatization, and Gary Bauer opposes the idea (but he opposes skirts that end above the knee).

President Clinton

suggested during his State of the Union Address that the government should invest a portion of Social Security in the market for us. This idea was rejected both by the public, the pundits, and most importantly

Alan Greenspan

. But, Forbes is the only one to offer a fully detailed plan with serious public support.

How much this will help Forbes is unknown. "Will the election turn on this? Of course not," says political scientist Larry Sabato of the

University of Virginia

. "Nor will Forbes solve his core problems with it: He still has never held public office and does not even vaguely look like a president." That's true, but former wrestler

Jesse Ventura

, who also ran on libertarian issues -- and an electric hammerlock -- didn't look like a governor. Sabato and most other election watchers do agree that the ball of privatization has been moved considerably downfield. Whether this enthusiasm could survive a recession is an interesting question.

Meanwhile on Capital Hill there have been some interesting stirrings toward Social Security reform. But it is doubtful that anything will get done this year, except for a lot of blame-assigning for the fact that nothing got done. The office of

Speaker J. Dennis Hastert

, R.-Ill., has signaled that he won't let the Republicans draw their guns on Social Security until the President draws his. Clinton, for his part, seems contented to do nothing except say "Save Social Security First," as he and Congress dive into the surplus to fund reindeer ranches in Alaska and build a new rumpus room for the Chinese embassy in Belgrade.

Despite the budget-surplus mentality in Washington, Social Security remains perhaps the most potent issue that could draw the Quiet Man, George W. Bush, into the kind of debate he would rather avoid at this point in the Y2K campaign.

That's why folks like Steve Forbes will continue to pound on this theme.

Jonah Goldberg is a contributing editor and a daily online columnist for the National Review. He can be reached at