If she gets to Congress, there’s no doubt that Michele Bachmann will do whatever she can to privatize Social Security.

Bachmann has stated on more than one occasion that she’d like to see at least partial privatization of Social Security, [1, 2] the government trust fund that guarantees at least some regular income to seniors and the disabled.

Bachmann says she favors following guidelines for privatization of Social Security set out by the Cato Institute.3 Ryan H. Sager of the Cato Institute explains: “Under a privatized system, workers would contribute a percentage of their income to a private retirement account (PRA). PRAs would function much like IRAs and be managed by the private investment industry.” 4 Edward H. Crane, President of the Cato Institution, tells us that if privatization goes through new generations of American workers would not be “would not be given the option to stay in the government-run (Social Security) system” [5] – effectively kicking the financial legs out from under the existing guarantee of Social Security payments.

So if Bachmann gets her way, the Social Security system—which has provided regular guaranteed payments to retirees and disabled persons for more seventy years [6, 7] —would turn over our Social Security payments to the private investment community for management on a “for profit” basis. And that’s just asking for a repeat of the Savings and Loan crisis of the 1980s.

During the 1980s the S&L industry was deregulated and many S&Ls lent far more money than was prudent to risky types of private sector ventures that they were not competent to oversee. 8 A large number of S&L customer's defaults and bankruptcies ensued, and S&Ls that had overextended themselves were forced into insolvency proceeding. In 1980 there were 4002 S&Ls trading, by 1983 962 of them had collapsed. S&L crooks and insiders got rich but depositors went bust—and US taxpayers got stuck with the bill for bailing them out. 9

Privatization of Social Security represents another chance for unethical money managers to defraud seniors and working taxpayers out of billions of dollars. Don’t give Michele Bachmann the chance to hand over your Social Security to the private sector.

1 http://www.startribune.com/587/story/254232.html

2 http://www.erstarnews.com/2006/february/7bachmann.html

3 http://www.startribune.com/587/story/254232.html

4 http://www.cato.org/dailys/3-05-98.html

5 http://www.socialsecurity.org/pubs/testimony/art-22.html

6 http://en.wikipedia.org/wiki/Social_Security_%28United_States%29#Creation:_The_Social_Security_Act

7 http://www.aarpmagazine.org/money/Articles/myths_and_truths_about_social_security.html

8 http://en.wikipedia.org/wiki/Savings_and_Loan_scandal

9 http://en.wikipedia.org/wiki/Savings_and_Loan_scandal