Voodoo Economics and Social Security, Updated

Earlier today, I highlighted John McCain's continuing fascination with privatizing Social Security, which sent me back to my previous postings on the issue. Two years ago today, I tried to sum up why diverting payroll taxes to private accounts for Social Security would be bad public policy:

A dollar cannot be in two places at the same time. Payroll taxes diverted into private accounts would no longer be available to pay for guaranteed retirement benefits. Put another way, Bush wants to at least partially convert Social Security from a defined benefit plan to a defined contribution plan, which would necessarily erode the guaranteed minimum income.

Despite the GOP's enthusiasm for privatization, I'm pretty sure that most Americans who aren't looking for more insecurity in their finances. Privatizing Social Security didn't turn out to be a winner in 2005 and 2006, and I don't think it will be a winner in 2008.