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The following article appeared in Left Business Observer #110, March 2005. It retains its copyright and may not be reprinted or redistributed in any form - print, electronic, facsimile, anything - without the permission of LBO.

Social Security, revisited

Earlier LBO articles on Social Security: 1994, 1998, 2004.

It's uncanny reading Paul Krugman's New York Times column these days—his stuff on Social Security sounds like what LBO was saying in 1998. His February 1 piece was all about how the Trustees of the Social Security system are projecting absurdly low economic growth rates, about half the long-term average, even though proponents of privatization assume that the stock market would continue to return its historical average. That couldn't happen, unless the standard measure for evaluating the dearness or cheapness of stock prices, the price/earnings ratio (which compares stock prices to underlying profits), were to scale unprecedented and ludicrous heights. The numbers Krugman used to illustrate the point are a bit different from LBO's seven-year-old vintage, but not by much.

It's nice to be vindicated, though one would always prefer it to be at Krugmanesque levels of name recognition. But, vanity aside, the transformation in the political discourse around Social Security over the last f