Without realizing it, the New York Times has just become an advocate of personal retirement accounts.
On today's op-ed page, the Times celebrates the fact that the long-run deficits of Social Security have gone down this year. Long term cash deficits, the Times argues, should be the real benchmark of success for the system.
That is interesting because that is exactly what the community of people who support personal accounts have been arguing since last year!
Personal accounts save actual cash in real accounts (something policymakers call "advance funding"), and this reduces long-run deficits in the current system. Not only do PRAs reduce long-run deficits, every plan for personal accounts proposed last year generated surpluses by 2080 or before. (You can verify this by looking at the policy research on www.ssa.gov)
If the New York Times is serious about using long-run cash flows to evaluate the success of the current system, it will have no choice but to support personal retirement accounts.
Given the financial gains PRAs offers, that's a good thing!
