A more recent Feldstein article in the _Public Interest_ continues the savings argument, and computes the present value of Social Security at $7 trillion. That would be a lot of savings he argues. This is in a discussion of why Chilean-style Recognition Bonds would not be practical for privatizing. Instead, Feldstein urges a gradual privatization to avoid issuing Recognition Bonds to the public. (See Financing Our Old Age (II): A new era of Social Security; Martin Feldstein; available at http://www.nber.org/feldstein/pi1998w.html )
A while ago, Max suggested in what I thought was a mocking tone that representing Social Security as "unfunded liabilities" makes as much sense as representing it as present value. But Feldstein takes the proposition in all seriousness.
Also, I remember Doug Henwood saying that we have more capital than we know what to do with, thus money is thrown at high risk ventures all over the globe.
So, my question is two-fold. How seriously can Social Security be figured as present value? And second, are our capitalists so starved for cash they need Social Security, as Feldstein's arguments would imply?
How about it, Max and Doug?
-- John K. Taber