KIDS Accounts, or private accounts by (yet) another name
by arenwin, Fri Aug 19, 2005 at 09:34:44 PM EDT
For those of you not familiar, there's a front page article in the Washington Post today about proposed legislation, modeled on already active pilot projects, that would:
Corzine, Schumer, Kennedy, and Ford, along with such Republican co-sponsors as DeWine and Santorum, propose to match either $500 or $1000 of additional savings beyond an initial $500 or $1000 deposit.
Did they really say that? A miniature version of a trust fund? Where's my microscope when I need it? Whatever happened to the party of bold ideas? Meanwhile, O'Neill touts this as another route out of Social Security. More below the fold.
This is how we're going to lift people out of poverty? A savings account that, if fully matched at birth, will provide slightly over 10% of the cost of State University tuition? That is, assuming an optimistic rate of return, generous legislation fully funded, AND that the families that most need the help can actually scrape up the matching dollars they need to receive the extra benefit?
Every federal program has an opportunity cost, and I don't see this is a step in the right direction. We do have real needs... and there are things we could do to genuinely lift and keep people out of poverty. As just a modest example, there's universal health care. Shoring up Social Security and Medicare (without privatizing them). Dramatically improved college financial aid programs.
To make things worse, this notion of an account for each child is being touted as a stepping stone toward a Social Security phase-out (although no one would say O'Neill's plan lacks vision - I'm just not overfond of the vision he has in mind). WaPo again:
Schumer, Corzine, and Kennedy aren't bad folks. But this just helps illustrate how far the ideals of the Democratic Party have fallen. Senators, Congressman, stop settling for "ownership society" red herrings. A successful opposition party proposes bold solutions to pressing problems, even if they can't achieve them right away. A one-time $500-$2000 per kid handout just doesn't cut it. That's a pathetic sop to the principles of the one-time "war on poverty." Find a better way to spend the money.
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