Toby: More college kids think they'll see UFOs than Social Security checks.

Bartlet: But they don't tell you how many believe in UFOs; that's the number we ought to be worried about.

Sales and Cons: How Public Policy May Differ.

-- By AndrewMcCormick?

The Idea

The idea is this: the sale of public policy is unique. It bears some resemblance to the cons and sales of Leff, but is fundamentally different. Significantly, the mechanics of selling policy are different from the mechanics of selling political candidates, and the assumption that public policy moves forward on the principles of electioneering is false: simply put, public policy can be driven in through the back door in a way sales, cons, and candidates cannot – specifically, diversion.

Private pensions, a fundamental element of retirement security, are disappearing. Public preoccupation with Social Security, and not private pensions, is a diversion, and a normatively bad one. By creating a fiasco around the financing of Social Security, fixed-income plans have been driven out the back door without the public noticing.

It may work for David Blaine, but it’s bad policymaking:

Con or sale, it is difficult to sell people a toaster oven by convincing buyers they should be upset by not owning an encyclopedia set. Similarly, it is difficult to convince people to vote for a candidate by distracting them from that candidate. Some of the decisions we make require individual action, at least minimally. Public policy, compared to toasters and senators, can be pressed on people by directing their attention elsewhere. Diversion, it seems, it more commonly a tool of magicians and thieves than Leff’s seller/conman.

The Mythology of Social Security in Crisis – The Diversion

It was suggested in class that Social Security is a Ponzi scheme. The comment was probably an observation that current inputs are financing current outputs, and, significantly, an echo of a common, sensationalist political message. As discussed below, these claims are without basis. But, claims that Social Security is a con are not unusual; Googling “Ponzi social security” returns 359,000 results.

The disappearance of private pensions has gained no such notice; a Google search of “disappearance of private pensions” returns 24,000 results, 93% fewer than “Ponzi social security.” Of the first ten results, only three are stories about the United States. One of those -- a hit in the New York Times archives -- is from 1883. Eighteen eighty-three. Adjusting the search terms (e.g. “retirement plans”) can improve the results, but not significantly. Fixation on Social Security may indicate a collective shove to the shoulder, distracting us from our (future) pockets being emptied of the pensions we are not paying attention to.

Private pensions support the working-class elderly; social security provides only a subsistence level income – private pensions are a way to improve the situation of the elderly through fixed income. However, today, fewer than one in five people has a private pension, and that number is diminishing. Companies are quickly moving to 401(k) programs, and fixed-income pensions have virtually disappeared in the private sector, and are disappearing in public employment. Normatively, the disappearance of private pensions should be a concern of voters. By comparison, the solvency of Social Security, politically and financially, is relatively safe.

The distinction between Ponzi schemes and Social Security offered in class was a pragmatic explanation, and emphasizes the strong position of Social Security. Roughly, it was “Social Security is successful; it brought a huge portion of the elderly out of poverty, and is a moral imperative. Deal or scheme, it looks like a good one.” Assuming the current downturn does not send us back into the Bronze Age, America will always find it advantageous to provide a safety net to keep the elderly from destitution.

Minor tinkering with tax policy, Re-institution of the estate tax, taxing only inheritances above $7m (far more conservative than proposed democratic initiatives), and directing the revenue to Social Security would provide 75-year solvency. Minor adjustment of the payroll tax could also be effective. Why is it then that such effort is spent talking about Social Security going bankrupt? Google itself is eager to panic; after typing ‘social security ban’, Google suggested I search ‘social security bankrupt’ (1.2m hits), ‘social security bankruptcy’ (4.2m hits), and, startlingly, ‘social security bankrupt 2008’, with 1.29 million hits. This is the result of an intentional campaign designed to be divisive, provocative, and distracting.

Can the Behavior of Buying Explain this Paradox?

People are consumers of information, and our information consumption mimics, to a degree, our material consumption. If we accept that people “buy” these ideas (perhaps in the way we talk about “buying into” arguments,) the deal/con can be analyzed. However, as suggested in the introduction, something strange is happening here: people “buy” something (a Social Security crisis) so they can be sold/conned into giving up something else (pensions). This diversion strikes me as an element of deception rather than sale.

The artistry of theft might be more useful than the artistry of cons/sales in describing this public focus. When a man in Times Square acts shifty, and sells a ‘stolen’ Rolex, that of course turns out to be a fake, a con has taken place. When young boys in a foreign country toss their infant brother into your arms, and proceed to empty your pockets, it is not a con -- it is a theft.

Google suggests the Social-Security-Ponzi-scheme concerns are widespread, although without serious basis. Their popularity strongly suggests they command many peoples’ concern. When government fights about Social Security, I am reminded of a common scene in any number of detective movies; when two protagonist partners are captured by the bad-guys, they begin to feign loudly fighting each other; they will then usually steal their guard’s keys. If lawyers are the figurative guards, as Mr. Hu suggests, and responsible for ensuring justice in the law, and the captives are the lawmakers, we would do poorly to spend too much time worrying about Congress’s theatrics, because we hold the keys to the welfare of grandparents.