. . . from the hijackers

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The campaign to allow workers to invest part of their payroll tax contributions in real private assets through personal retirement accounts has been hijacked.

It has morphed from a debate about personal ownership and control for young workers into a tax-increasing, benefit-cutting, retirement-age-raising monster, devouring the very idea of an ownership society.

In recent weeks, we fear President Bush and the Republicans in Congress have been suckered into a debate about shoring up Social Security finances, and have put on the table a series of unattractive options voters ultimately will reject.

This is precisely the debate the Democrats want to lure the GOP into. This trap could have very unhappy political consequences for Republicans who have lost seats and control of Congress before by pinching Social Security with budget-balancing measures.

Moreover, the Republicans' theme should be better benefits for the future. Instead, they now promote a "Pay more, work longer, get less" message. That's not the sound-bite many Republicans should want to carry into the midterm elections.

This is the time to recapture the debate on personal accounts that will snag Democrats on the horns of a dilemma. The one fact about Social Security that infuriates almost all Americans is the theft of money from the "trust fund." Over the last 15 years, well more than half a trillion dollars of Social Security tax dollars have been spent on other government programs. It's illegal for private companies to spend pension funds this way.

So we suggest a plan with the slogan: "Stop the raid; start the accounts."

It would be fascinating to hear AARP and MoveOn.org explain why it's better for Congress to continue squandering Social Security surpluses (about $90 billion a year) on pork-barrel spending and corporate welfare rather than really saving the funds to reduce Social Security's unfunded liability by allowing workers to invest them via personal retirement accounts. If workers have the funds in a personal account, the government cannot (mis)spend them.

Increasingly, a false analogy is drawn between Bill Clinton's stick-it-out, losing strategy on HillaryCare and George W. Bush's determination on personal retirement accounts. The Washington Post played the story this way: "Clinton's signal error, most of his aides concluded in retrospect, was not dropping his [national health care] plan in favor of a bipartisan deal on more modest legislation while he still had enough political leverage to bring Republicans to the table."

There is a big difference, however, between HillaryCare and personal retirement accounts. Though HillaryCare was a crack-pot idea from the get-go, the so-called national health care "crisis" it purportedly addressed was taken very seriously by many Republicans at the time, making them susceptible to the lure of an early compromise. But the longer HillaryCare was exposed to the light of day, the more it smelled. And the more people got to know about it, the more they disliked it.

Personal retirement accounts, by contrast, have the opposite political dynamic: As workers learn more about this option, they become more, not less, supportive.

We favor big personal investment accounts, but we also believe even small accounts would have great political and economic benefits. That is why a plan to allow private accounts out of the current surplus could crack this debate gridlock.

The accounts in the first few years would be between 2 percent and 3 percent of payroll. A progressive system could allow workers to put their first $1,000 of payroll tax into the accounts. This would be real money to middle-class workers.

With those funds denied to Congress, federal spending would likely fall by close to the amount placed in the private accounts. A new budget rule could ensure the deficit is not increased but that the growth rate of federal spending falls in proportion to the amount put in the private accounts.

But any acceptable fall-back compromise first must not harm future prospects of expanding a limited program into a comprehensive reform of Social Security based on personal accounts. This plan accomplishes that. By establishing the principle of personal accounts -- even if for only the next 10 years while trust-fund surpluses still exist -- Republicans create a camel's nose under the tent. Workers will demand more.

In other words, this plan of "investing the surpluses, rather than squandering them," satisfies the White House's political imperative to create a Bush legacy on personal accounts while leaving the door open to expanding the accounts into a full-blown reform down the road: Stop the raid; start the accounts.

Stephen Moore is president and Larry Hunter is chief economist at the Free Enterprise Fund.