The 12,000 Dow - Noblesse oblige, American style

Lost in the partisan idiocy (that’s too weak a word) that constitutes our politics these days is anything faintly resembling the discussion of ideas, especially those that deeply affect us and our children. I was reminded of this by an excellent editorial in the WSJ today (sub only, alas) – The Population Boon. It channels Nixon and Paul Ehrlich (both of whom were devoutely Malthusian… yes, Nixon) from the days when we were all worried about the population explosion. Times have changed. As the WSJ notes:

In Japan and Western Europe, population implosion has become the crisis of the moment. Birth rates in most Western European countries are now so low that governments are busily looking for ways to avoid a very different kind of demographic catastrophe. The problem posed by Europe’s aging population is exacerbated by its reliance on intergenerational transfer payments to support its public pension systems; America, with both a greater emphasis on wealth accumulation and a higher birth rate, is comparatively better off. Demographics and Social Security are on a collision course here as well, but Europe’s difficulties in this regard make America seem fortunate by comparison.

China, thanks to its draconian one-child policy, also faces a demographic challenge, embodied in the oft-heard refrain that the Middle Kingdom risks becoming the first country ever to grow old before it grows rich. Population-control measures have resulted in a shortage of women and girls, one of many unintended consequences of the population-control hysteria of the 1960s and 1970s.

A shortage of women and girls is something I personally would not like to see for a whole host of reasons. But turning back to our country, I am reminded of the Social Security debate of a couple of years ago – or the pseudo-debate, because it never happened. My former liberal allies simply shouted down the discussion before it could start. Never mind that those it might have helped most were their supposedly disadvantaged constituency. As with much affirmative action debate these days, there is a (not very) covert vested interest in failure operating whose object is to preserve the perquisites of a pseudo-liberal mandarinate.

But enough snark. Most of us know that Social Security, like most pension plans, is nothing more than a Ponzi scheme. Nothing wrong with that. Ponzi schemes have their place and are useful in this instance in the creation of a necessary safety net. But it would seem obvious that we cannot depend forever on an expanding population, useful as that may be, to preserve this net. 300 million now, 400 million later… where will it stop? And will even those numbers be able to sustain an aging population as medical science extends our lifespan toward 100. Doubtful.

Nevetherless, mega-capitalists like Ted Kennedy refused to countenance the idea of any part of Social Security being privatized. The implication here is that the lower classes cannot be trusted to invest in the market. The hoi-polloi just don’t understand. And the market is too volatile for them. This of course has put the kibosh on the myriad suggestions of how to preserve this safety net while allowing for market investment. I’m far from an economist and I can think of a half-dozen myself. What the Kennedys and their ilk have done in their lust for power is cut the poor out of their share in the 12,000 Dow, keeping them down on the farm as it were. Noblesse oblige, American style.