More Social Security bunk
"There are polls that say that young people in their twenties think it's more likely that they will see UFOs than that they will ever collect Social Security." This pronouncement came from President Clinton in an address at the University of Illinois this year. But you could have heard virtually the same thing from Newt Gingrich ("More people below the age of thirty believe in UFOs than believe in their Social Security pensions") or Richard Gephardt ("Many young people now think there is a better chance they'll see a UFO than a Social Security check") or John Kasich ("More kids believe in UFOs than the Social Security check"). For that matter, you could have read it in Newsweek, The Economist, or U.S. News & World Report--or heard it on ABC's "20/20," CNN's "Capital Gang," or NBC's "Nightly News."
But, upon closer inspection, the true state of public opinion on Social Security turns out to be more complicated than this popular sound bite suggests--a lot more complicated. Confidence in the system isn't high, but it's not nearly as low as Social Security critics say it is. What's more, the support for the privatization schemes these critics have proposed is shallow and tentative. It has as much to do with leading (or misleading) poll questions as it does with the merits of the actual plan.
Consider, first, that infamous UFO statistic. The finding comes from a 1994 poll of 18- to 34-year-olds commissioned by Third Millennium, a youth-oriented organization bankrolled in part by conservative foundations and such longtime Social Security critics as Pete Peterson. To hear privatization advocates tell it, young people were asked to compare their faith in Social Security with their belief in UFOs. But this is not how Frank Luntz and Mark Siegel, the Republican and Democratic pollsters hired to take the survey, asked the question. Quite the contrary, the pollsters posed a series of questions. The Social Security question was fifth on the list. The UFO question was fourteenth--the last substantive item.
It might seem like a minor detail. But, when other pollsters asked respondents to compare the two possibilities directly, the results changed dramatically. In a survey by the Employee Benefits Research Institute, Americans 33 and younger chose Social Security, 63 percent to 33 percent. The margin for Americans of all ages was even wider--71 percent to 26 percent. Another poll confirms this finding: The majority of Americans, young and old, put more stock in Social Security than in little men from Mars.
Why the disparity? One likely explanation is that people generally approach survey questions with different "metrics." When pollsters ask about UFOs, respondents typically approach the question as a mere thought experiment. On Social Security, however, people think in concrete, real-life terms: they remember recent news reports, think about relatives who receive checks, and recall their payroll taxes. By asking respondents to compare the two possibilities directly, as the Employment Benefits Research Institute did, you force them to apply the same standard of uncertainty--and produce a more telling result.
Sorting through other polls produces similarly murky conclusions. It's true that confidence in Social Security is low. But it's also true that confidence has been low for some time. From 1975 to 1982, confidence in the program's future dropped from 65 to 32 percent; recently, it has actually crept up to around 40 percent. Granted, such low confidence--old or new--is not a good thing. But the fact that trust began to fall in the '70s suggests the real cause is the public's general loss of faith in government after Watergate and Vietnam, not any focused critique of Social Security. Indeed, the historic 1983 reforms of Social Security produced no change in confidence in 1984 or 1985.
With the stock market at record levels, tying Social Security to the Dow appeals to many Americans. Thus, it's not surprising that, when pollsters ask respondents whether they're in favor of creating private retirement accounts for investment in the stock market, the answer is an overwhelming "yes." In polls Bill McInturf conducted for the Cato Institute, for example, two-thirds of the respondents supported this form of privatization.
But, when pollsters mention the fact that the potential gains of stock market investing come with greater risks, opinions of privatization change dramatically. In January of last year, NBC/Wall Street Journal polls found that, when Americans were asked to weigh the "risk of losing money" against the "potential of higher returns," 57 percent thought the risks were more important. Surveys by CBS/New York Times, Time/CNN, and The Washington Post produced similar findings. Another fact that privatization advocates tend to leave out of their polls is that a shift to a fully private system would entail substantial transition costs to meet the needs of current retirees. When informed of that by pollsters for NBC/Wall Street Journal, 61 percent of respondents said they thought the costs of privatization outweighed the benefits.
One could, of course, argue that privatizing Social Security is a sound idea on its own merits--because it would boost the national savings rate or forestall insolvency later. (We don't happen to think either claim is true, but that's not the point of this article.) It's also possible that, once people consider all the risks and drawbacks, they might decide to support privatization anyway. But we'll never know unless the public gets a chance to examine the issue carefully and draw its own conclusions. And that won't happen until Social Security critics stop talking about flying saucers.
Lawrence R. Jacobs is associate professor of political science at the University of Minnesota, and Robert Y. Shapiro is professor of political science at Columbia University.
(Copyright 1998, The New Republic)