Kinsley typical gets the point but does not go far enough to hit the real target. That is why perhaps he is accepted in the mass media.
It takes the fantasy of the SS proposal for him to see the fallacy of the free market. Market "inefficiencies", more than risk compensation, produce all the profits on Wall Street. Theoretically, under free market principles, it should be unnecessary to chose the smart investment because all instruments are "priced" the Hayekian ways to make return on investment come out equal in the long run, risk being always fairly compensated for. When they don't come out equal, the situations are called market inefficiencies. So, by definition, all opportunities for profit reside exclusively on market inefficiencies.
With increasing sophistication and complexity of new marketable financial instruments, being they debt or equity or derivatives, the astute has a distinct advantage over the unaware masses. This advantage constitutes a massive, systemic transfer of wealth, greater than any government social entitlement program.
Yet, unlike inventors, these groups of the financially astute contribute not at all to economic production. Often they purposely create market inefficiencies in order to capture profit. The rececent normalized daily volatility of stock prices represents one example of these manipulated inefficiencies. Others are less visible, such as the inverted interest rates curve that preceeds recessions. The current SS proposal only highlights this pervasive arrangement that has gone on for more than a century. Ironically, the SS proposal will work on a sub-optimization level, because, like the debacle of LTCM, when SS funds go into the equity market, it will be deemed to big to fail. It is good for the SS Trust Fund, but bad for the economy. So there is an anticipated additional US Treasury/Federal Reserve Bank guarantee that the market will not crash, which is why the market will embrace the proposal with open arms. It is a game where profits are privatized, and losses are socialized. In that sense, the American economy is already half socialistic: the loss half. The question is: when are we going to socialize the profit half for balance.
Henry C.K. Liu