Items from the White House Social Security conference-TSP

December 15, 1998

At last week's White House conference on Social Security, both former Social Security Commissioner Robert Ball and Henry Aaron, of the Brookings Institution, suggested that the federal Thrift Savings Program (TSP), a retirement benefit program offered to federal employees, is an example of a successful government retirement investment plan that's not politicized. The director of the Cato Institute Project on Social Security Privatization, Michael Tanner, says it ain't so:

"In reality, the TSP is a defined contribution system of individually owned accounts, much closer to the type of program advocated by Cato than to proposals to allow the government to invest the Social Security Trust Fund. Workers have a property right to their TSP account, meaning that there is a fiduciary duty governing the investment of those funds. Further, as a defined contribution program, investment decisions are transparent--workers can see the impact of any investment decisions on their future retirement benefits and object if politicized investments reduce returns. Indeed, since the TSP is voluntary, workers can even refuse to participate if they dislike the program's investment policy. The TSP in no way assuages concerns over government investing."

There's an interesting extended discussion of the federal Thrift Savings Plan in Mike Tanner's recent Cato briefing paper, "The Perils of Government Investing."

Catholic Charities versus the Poor

Catholic Charities, USA has always claimed that it judges public policy changes by how they would affect the poor. Imagine our surprise and anger to see Sharon Daly, spokeswoman for Catholic Charities, on C-SPAN railing against Social Security privatization. This, despite the fact that the current system hurts the poor, and that privatization would dramatically increase returns for low-income workers.

Catholic Charities used to be one of the most efficient and nonpolitical charitable organizations in the United States, but they are now preoccupied with advancing an anti-free-market big-government agenda. In today's commentary, Stephen Moore argues that Catholics should begin to rethink their support for Catholic Charities, now that their contributions partially finance a propaganda campaign to prop up the welfare state.

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