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The Phantom Menace

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Rolling Stone is not worried about Social Security. Since the median age of its readership—even with me on its subscriber rolls—is 29, this has more significance than if, say, Harper's, Reader's Digest or The Homiletic and Pastoral Review had given the retirement system an OK. Rolling Stone's constituency is definitely on the donor side of the Social Security system or the pre-donor side, given the vast attention its ad-sales group pays to its age 12+ audience.

In truth, the infallible Rolling Stone national-affairs desk, handled by Dr. Hunter S. Thompson, and the foreign-affairs desk, handled by Mr. P.J. O'Rourke, didn't break this cover story for the magazine's youthful readership with a $55,250 median household income. But the AARP should take heart from it anyway. Assistant managing editor Eric Bates and assistant editor David Swanson, assisted by illustrator Steve Brodner (who shows President Bush as a roulette-table croupier simultaneously spinning a wheel of fortune), go down to Princeton to interview "prize-winning professor of economics" Paul Krugman. Mr. (or Dr., they don't say which) Krugman's interview is a break from his writing a new economics textbook, an experience that is itself an extended break from his routine of turning in columns for the op-ed page of The New York Times and shout-dueling Bill O'Reilly on CNBC, with Tim Russert refereeing.

So there in the Jan. 27 issue, nudged between profiles of indie songwriter Conor Oberst of Bright Eyes and "rock goddess" Gwen Stefani, Krugman holds forth on "Social Security, A Fake Crisis."

Economists and actuaries are such smart fellows. They probably did quadratic equations in the third grade; thus, when they reach adulthood, the only new math available to them involves future trillions when it doesn't involve mere billions. Ad-agency people, for the most part, fell out of math along about intermediate algebra, so when Krugman charges that the plan is "to convert Social Security into a giant 401(k)," they wonder if such charges would come back from a diagnostic lab labeled "benign."

I know some guys who started an ad agency, oh, about 18, 19 years ago. They made the rent and the payroll and built a pretty good size business. They even got to the point where they were so successful that some of them grumbled that they weren't going the John Edwards perfectly-legal-subchapter-S route to avoid paying the Medicare tax on all their earnings. Eventually they started a 401(k), and every year at the Christmas party, one of the partners would stand up and announce what percentage of the employees' contributions the agency would match. Most years, 50 percent; one year, 25 percent. The reactions (SFX: applause and cheering) were the same no matter what the percentage or the actual cash, which maxed out at five thousand bucks.

One year, one of the partners who wanted full credit for the generosity of the management suggested that they also announce that the agency would match, dollar for dollar, 100 percent of Social Security retirement-fund contributions, which maxed out at another $8,000 or thereabouts.

"Not a good idea," another partner said.

"Why's that?"

"They know the difference between their money and the government's money," said the partner about the employees, whose median age was around 27. "With our 401(k), they're fully vested in a couple of years. Nobody gets vested in Social Security."

That's not entirely correct, though. There was a copywriter who worked more than 20 years in the business: Foote Cone & Belding, Ammirati & Puris, Della Femina Travisano, McCann, Digitas, a bunch of other places freelance. He died at 44, single, but his heirs did get some vesting for his and his employers' 22 years' worth of Social Security contributions: $250, called a "death benefit."

Chris Rock used to get a lot of laughs from his notion that Social Security was a system in which black men subsidize white women, an actuarial riff in his act where he digressed into racial and sexual disparities in life expectancy. Coincidentally, on Jan. 28, Paul Krugman returned from the cloisters of textbook creation to The New York Times (page A23) to demolish Chris Rock's thesis. In a fight between a prize-winning economist and a prize-winning comedian, I'd always go with the one whose work gets the bigger laughs. Krugman, the winner here, going away.