Klein's confusion on Social Security

Joe Klein gets into it with new Time blogger Dick Armey. He takes exception to what he calls Armey's blather on Social Security and other entitlements, but displays some fundamental misunderstandings. Here's Joe on Social Security:

And then there's social security...that poor, little, teeny-tiny, no-risk safety net we have for those who didn't do so well in life.

I ask, if Social Security is such a great deal, then why is it mandatory? [Armey's quote]

Since you asked: Because, in a democracy, we have this weird concept: the consent of the governed. Social security ain't the third rail of American politics for nothing. The people really like it, and have for 70 years now.

What Joe calls the "consent of the governed" is synonymous with saying that it is just that minorities must live with the decisions of majorities. I think a phrase might have even been coined. Joe, correct me if I am missing the distinction.

More to the point -- if "the people really like" Social Security, then there should be no risk in making it opt-in. We already know that everyone wants it. Right?

Stepping back, I am sure that Joe intended "teeny-tiny" and "no-risk" as a bit of sarcasm. If we mean a system which removes 12% of working people's income a year -- that's in addition to payroll taxes -- then, yes, it's teeny-tiny. It's also no-risk in the sense that it (along with Medicare) threatens to swamp federal finances over the next 70 years.

To say such things are no-risk is to be fundamentally ignorant on the concept of opportunity costs (think education).

But the more revealing part is that he imagines Social Security to be a "safety net we have for those who didn't do so well in life". Here's a clue Joe -- it's a pension, not a welfare system. How do we know? Well, those who have done best in life reap the greatest SS benefits later.

If Joe would like it to be a welfare system, great. If we take the biggest beneficiaries out of the system, that leaves more for the needy. Of course, we'd need means-testing. I suspect that this is not his vision.