Josh Marshall

Josh Marshall is editor and publisher of TalkingPointsMemo.com.

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TPM reader TS writes in with a great idea. With President Bush bringing the Bamboozlepalooza Tour to Philly tomorrow, it seems like a great opportunity for Gov. Rendell to take himself out of the Fainthearted Faction. Yes, Dems who aren't even in Congress can get special Associate Membership in the Faction for particularly gratuitous examples of Faintheartedness. And Gov. Rendell is one of two who has it.

One of the most misleading comparisons President Bush made in his State of the Union address came when he compared private accounts carved out of Social Security to the Thrift Savings Plan available to employees of the federal government.

Now George Will has picked up the cudgel, combining this bogus comparison with the now de rigueur demonization of Sen. Harry Reid, who scares Republicans.

In his final flourish Will writes ...

Begun in 1987, the Thrift Savings Plan, which as of December 2004 had assets of $152 billion, is a retirement-savings plan open to all civilian federal employees, including senators, and all members of the uniformed services.

They can invest as much as 14 percent of their salaries in one of five retirement funds. Consider the rate of return of C Fund, one of the five. It is a common-stock fund, so it should represent the risks that Reid thinks should terrify Americans:

In only four of 17 years has the rate of return been negative. But in 11 years the rate has been greater than 10 percent, in eight years it has been greater than 20 percent, in four years it has been greater than 30 percent. The compound annual rate of return for the last 10 years has been 12 percent, and the return over the 17 years has been 12.1 percent.

Reid participates in the plan, but opposes allowing all Americans the comparable opportunity that Bush is proposing. But if the numbers just cited are the result of roulette, the legislators should let the rest of us into the game in which they are prospering.

Who will make the obvious point?

No federal employees put their Social Security funds into the TSP. The TSP is in addition to Social Security. To the extent that there is an analogy to anything it is to an add-on account -- the kind Democrats support and <$Ad$> Republicans oppose. Indeed, the TSP is little different from private sector 401ks, a defined-contribution retirement plan.

Indeed, no less an authority than the Social Security Administration says: "The TSP is a defined contribution plan similar to the 401K plans offered in the private sector. Contributions are made by payroll deduction. Both the money that is contributed and the interest earned are tax-deferred."

Let's give Will the benefit of the doubt and assume he's just ignorant rather than intentionally misleading. Democrats don't think people shouldn't invest in private securities as part of their retirement planning. What they say is that that should be in addition to Social Security, from which workers get a flat guarantee of a base level of retirement income.

The question isn't why everyone shouldn't have the chance to get in on the Thrift Savings Plan. The question is why everyday Americans should have to choose between Social Security and the TSP when federal employees now get to have both.

The point is simple and no more complicated than the elementary concept of diversification in an investment portfolio. Ideally, retirement planning should include multiple sources of income: the guaranteed, threshold level of income provided by Social Security, private savings and an employer-based pension. Each has different levels of risk involved. One key importance of Social Security in this mix is that it is the one part of the equation in which there is a flat, no-matter-what guarantee.

And as long as we're on to this issue of the guarantee behind Social Security, consider this.

In a fact-sheet distributed by the White House last week, the president's budgeteers argued that by diverting 1/3 of his or her payroll taxes into a private account, a worker would forgo 1/3 of their guaranteed benefit from Social Security.

But in a policy memo making the rounds in Washington, Jason Furman argues that this is incorrect. For workers who live their whole careers in the president's private account system -- which would start with kids born in 1990 -- diverting 1/3 of their payroll taxes would result in forgoing 2/3 of their guaranteed benefit.

As Furman writes: "Under the President’s plan the worker would have to give up about two-thirds of future government benefits and be entitled to receive about $5,000 annually from the traditional system – that is only enough to replace 8 percent of one’s pre-retirement income."

We've just added the Furman memo to the TPM Document Collection. So you can read it yourself.

AP: "When Rep. Rob Simmons walked into the White House Tuesday, he was ready to defend his opposition to the president's proposed overhaul of the country's Social Security system. So in the meeting, Simmons, R-Conn., handed President Bush a copy of an opinion piece he wrote, opposing any effort to divert Social Security dollars into personal accounts _ a provision Bush has advocated."

Rep. Simmons of Connecticut just keeps getting Louder and Prouder.

On the other hand, Rep. Chris Shays seems to be a big supporter of replacing Social Security with 401ks-like private accounts.

I don't normally list members of Congress by their hometown. But I did yesterday with House Conscience Caucus Dean Rep. Jo Ann Emerson of Missouri. And for good reason -- because she represents Cape Girardeau, Missouri, hometown of our good friend Rush Limbaugh.

So we do have to ask. Who's more in touch with folks in the 8th District? Jo Ann or Rush?

Talk about burying the lede!

If I'm understanding the US News squib correctly, the Luntz memo not only says that Brian Williams is an easy mark. Luntz apparently also believes that CNN is now so thoroughly whipped as to be on par with FOX in terms of Bush-fidelity.

[ed.note: I have to thank this blog for setting me straight on this egregious error.]

If you're a supporter of Social Security phase-out, then by all means get over to the Club for Growth website and give these guys some money. Because it's not at all clear they can afford, at present, to run ads against all the Republicans going into the Conscience Caucus.

(ed.note: For those of you who are not familiar with them, the Club for Growth is a public interest group that advocates on behalf of the extremely wealthy.)

I have to tell you I'm a little concerned about some members of the Conscience Caucus and more than a few folks who are trying to get in.

Let's just start with Sen. Linc Chafee (R) of Rhode Island.

First, he's against Social Security phase-out; then maybe he's for it; then he can't make up his mind. Tomorrow who knows? Doesn't this sort of felonious flipfloppery and indecision start to have a corrosive effect on one's chances for reelection?

Better to be in the Caucus than out of it, certainly. And Chafee's still hanging on, if in CUP? status. But Reps. Simmons and Emerson seemed to know they were against phase-out from the get-go.

I know everyone's got to dance once in a while. But once phase-out goes down in flames isn't this the sort of thing Jim Langevin (D-RI) is going to use to clobber Chafee?