The Washington Canard

WEISMAN REDUX

Last week I gave the Post's Jon Weisman the benefit of the doubt when he royally screwed up an assessment of the emerging Social Security plan. Today I'm much less inclined to do so; his column today seems deliberately stacked against the Bush plan. Let's begin where he does:

To conclude that Social Security is careening toward a crisis in 2042, President Bush is relying on projections that an aging society will drag down economic growth. Yet his proposal to establish personal accounts is counting on strong investment gains in financial markets that would be coping with the same demographic head wind.

That seeming contradiction has become fodder for a heated debate among economists, who divide sharply between those who believe the stock market cannot meet the president's expectations and those who say investor demand from a faster-growing developing world will keep stock prices rising.

That's interesting. I honestly don't know enough about the debate to take a side. But it seems that Weisman already has; at the very least, he doesn't think it's important to fully explain both arguments. Consider Weisman's sourcing for the article ...

Number of experts/organizations quoted to oppose the Bush plan: 7
Number of experts/organizations quoted to support the Bush plan: 2
Number of those supporters not employed by the White House: 1

I'll demonstrate. All those opposed:

TIAA-CREF analyst Douglas Fore: "If economic growth is slow enough that we've got a problem with Social Security, then we are also going to have problems with the stock market. It's as simple as that."

CSIS analyst Richard Jackson is quoted describing "the great depreciation scenario."

Mannheim Institute of Germany refers to the same thing the "asset meltdown hypothesis."

Prudential strategist Edward Keon "wrote that long-term economic growth of around 2 percent would probably produce equity returns of, at most, 3.5 percent after inflation." [Note: This is used to rebut a higher administration estimate.]

Morgan Stanley economist Richard Berner: "The administration's assumptions, especially for a balanced portfolio, sound pretty high."

Economists J. Bradford DeLong and Dean Baker are among those who "say the hurdle [of earning more through personal accounts] will be impossible to clear."

All those in favor:

Bush's Council of Economic Advisers: "Although short-run movements in growth can affect stock market returns, there is no necessary connection between stock returns and economic growth in the long run."

Wharton professor Jeremy Siegel: "If there isn't an alternative source of demand for those assets, you're going to have a tremendous slowing of growth. The only way to save the financial markets is very rapid growth in the developing world."

Some would say this is just the Post holding the administration accountable, and in a narrow sense I cannot disagree. Weisman does a few things right, such as mentioning that the think tank DeLong and Baker work for is "liberal," and that Berner is an "opponent of diverting Social Security taxes into private accounts." The problem is that it's relentlessly one-sided. And in an oversight that makes me all the more skeptical, Weisman never mentions Siegel's actual position on personal accounts. If anything, he comes off as a rather lukewarm supporter. Does Bush have any defenders outside of the White House? To read this, the answer seems no.

Are there instances in which the pro-reform crowd has a compelling argument against the status quo? Of course, but the Washington Post isn't interested. The assumption seems to be either a) everyone already knows those arguments, or b) it's Bush's job alone to sell it, or c) both. Therefore, any story that doesn't single out the Bush plan for criticism is just cheerleading. But that shouldn't be the case. Yes, most people are vaguely aware that Social Security is likely to run out of money and that it's a bad deal. Of course, we also know it will cost a lot to do anything about that. Both sides are worth exploring. Not to mention quoting.

I haven't watched his byline enough in the past to know if this is his modus operandi. Now I'm paying attention.

posted by WWB at 2:30 PM |