Rendell lies on Social Security
A few days ago, Governor Rendell complained that the McCain campaign was “deplorable” and “despicable” for trying to scare voters by painting an inaccurate portrait of “spreading the wealth” (which Rendell thinks is a good idea). Rendell added “I want to crush them.”
If I was naive, I might have been surpised when Rendell appeared on PCN last night and tried to scare voters (especially older ones), saying that McCain would take away their Social Security. Rendell’s words (or close to it, as I don’t have a transcript):
Personal Accounts would have been great if you had retired in 2006… but if you turned 65 and were due to receive Social Security today, you’d have nothing left.
First off, anyone with any experience investing – about 60% of Americans – know that you should diversify: as you get closer to retirement, you should invest in safer return (i.e. bonds) that don’t lose value.
Second, the stock market losses are large, but would not wipe out your savings. For the year to date, the Dow is down about 29% – this is a huge loss, but hardly means “you’d have nothing left” (which would take 100% losses).
If that were true – pension funds for state workers would also “have nothing left,” and Governor Rendell should propose a plan to put pension money under a mattress in the Governor’s Mansion, rather than invest that money in the stock (and bond) markets.
Finally, didn’t I just post a link to Michael Tanner’s analysis on how personal accounts are still a good idea? If you’ve forgotten, that analysis concluded that the stock market – even after its recent drubbing – would have returned four times the amount of money as Social Security (since Social Security has a minimal rate of return). Surely someone in Rendell’s staff reads this blog and prints it out for him.