rmstrong Williams, a prominent conservative commentator who was a protégé of Senator Strom Thurmond and Justice Clarence Thomas of the Supreme Court, acknowledged yesterday that he was paid $240,000 by the Department of Education to promote its initiatives on his syndicated television program and to other African-Americans in the news media.

The disclosure of the payment set off a storm of criticism from Democrats over the Bush administration's spending to promote its policies to the public. According to a copy of the contract provided by the department yesterday, Mr. Williams, who also runs a small public relations firm and until yesterday wrote a syndicated newspaper column, was required to broadcast two one-minute advertisements in which Education Secretary Rod Paige extolled the merits of its national standards program, No Child Left Behind.

But the arrangement, which started in late 2003 and was first reported yesterday by USA Today, also stipulated that a public relations firm hired by the department would "arrange for Mr. Williams to regularly comment on N.C.L.B. during the course of his broadcasts," that "Secretary Paige and other department officials shall have the option of appearing from time to time as studio guests," and that "Mr. Williams shall utilize his long-term working relationships with 'America's Black Forum' " - an African-American news program - "to encourage the producers to periodically address the No Child Left Behind Act."

Mr. Williams, 45, apologized yesterday for blurring his roles as an independent commentator and a paid promoter. "This is a great lesson to me," he told Paul Begala of CNN, who himself has an off-air job as a paid Democratic political consultant but discloses both roles.

Mr. Williams declined to blame the department for his woes. "I can easily sit here and criticize the administration," he said. "But I got my own problems today, and that is what I am trying to deal with."

The disclosure about the arrangement coincides with a decision by the Government Accountability Office that the administration had violated a law against unauthorized federal propaganda by distributing television news segments that promoted drug enforcement policies without identifying their origin. More than 300 news programs reaching more than 22 million households broadcast the segments. The accountability office made a similar ruling in May about news segments promoting Medicare policies, and the Drug Enforcement Agency stopped distributing the segments then.

In a statement, the Department of Education said yesterday that the deal was an appropriate part of its efforts to explain its policy to "minority parents." The statement said: "The contract paid to provide the straightforward distribution of information about the department's mission and N.C.L.B. - a permissible use of taxpayer funds."

John Gibbons, a spokesman for the department, said Mr. Williams was the only broadcaster or journalist paid to promote the policy. Mr. Williams and department officials said the department's payments to its public relations contractor, Ketchum, ran to $1 million.

House Democrats including the minority leader, Nancy Pelosi, and Representative George Miller, senior minority member of the Education and Workforce Committee, both of California, released a letter to the president suggesting "a deliberate pattern of behavior by your administration to deceive the public and the media in an effort to further your policy objectives" and urging disclosure of "all past and ongoing efforts to engage in covert propaganda."

Questioned about the arrangement, Scott McClellan, a spokesman for the president, referred reporters to the Department of Education.

In an interview, Mr. Miller called the release of the news segments and the payments to Mr. Williams part of "a very dangerous practice that deceives the public" by concealing the role of taxpayer dollars in promoting partisan policies. "Are they funding propaganda?" he asked. "Are they funding money to their friends?"

But public relations executives said that the government distribution of prepared news segments without on-air disclosures of their origin was a bipartisan practice that predated the Bush administration.

"The Clinton administration was probably even more active than the Bush administration" in distributing news segments promoting its policies, said Laurence Moskowitz, chairman and chief executive of Medialink, a major producer of promotional news segments. After the Government Accountability Office decision last spring, he said, his firm began advising government clients to disclose each tape's nature in its script.

The arrangement with Mr. Williams "is stupid, it is unseemly, and it is tacky," said Jonah Goldberg, a contributing editor at the conservative National Review.

The National Association of Black Journalists criticized the administration and Mr. Williams alike yesterday, calling on newspapers that use his column and television stations that use his commentary to "drop him immediately."

"I thought we in the media were supposed to be watchdogs, not lapdogs," Bryan Monroe, an official of the black journalists' group and an assistant vice president at Knight Ridder, said in the statement.

In an interview, Mr. Williams said his mistake was thinking like a businessman, without worrying enough about journalistic ethics. He began his career in politics as an aide to Mr. Thurmond of South Carolina. He entered the media business, he said, only after he became known for publicly defending Justice Thomas, his former boss at the Equal Employment Opportunity Commission, during his stormy confirmation hearings.

After that, he said, he continued to operate a small public relations firm, Graham Williams, with his business partner Stedman Graham, who eventually became known as the partner of Oprah Winfrey and left the business. Aside from the Department of Education, Mr. Williams said, his clients were all private businesses. With about five employees, he said, his company's revenue runs to about $300,000 a year at most, and last year ended in a loss.

But then he also began writing his newspaper column, syndicated by Tribune Media Services, which dropped him yesterday. He said about 50 papers ran the column. He also began broadcasting a syndicated conservative talk radio show that eventually faded away. And more recently he began a syndicated conservative television show, "The Right Side," and another series for a fledgling African-American cable channel, TV One.

Mr. Armstrong said his news show ran on cable channels including Dr. Jerry Falwell's Liberty Television, Sky Angel television, the Christian Television Network and a handful of local stations. Yesterday, Mr. Williams was counting the lessons learned. "I have realized, you know what? I am part of this media elite club, and I have to be more responsible."

hicago

CIVILIZATION exists by geologic consent, subject to change without notice," wrote the historian Will Durant. The tsunami that struck Asia last month, caused by an earthquake off the coast of Indonesia, is a reminder of the validity of Durant's thesis; so far it has left some 140,000 people dead.

Throughout human history, earthquakes have set in motion great economic changes and political revolutions. Last month's tsunami was devastating in its toll on human life, but its economic and political effects may be more modest.

The San Francisco earthquake in 1906 was an important catalyst for the financial shocks that led to the creation of the Federal Reserve in 1913. Because British insurance companies underwrote the majority of the city's insurance policies, millions of pounds of insurance claims were soon presented in London. The insurance claims generated a huge outflow of gold from London, which forced the Bank of England to nearly double British interest rates and to lobby British banks to stop buying American debt. Higher interest rates played a role in creating a financial panic in America, and Congress was so alarmed that it established a commission to investigate whether the government should play a greater role managing the money supply. The result of the commission's work was the creation of the Federal Reserve Bank.

Most of the businesses and people affected by last month's tsunami are relatively poor, and few had insurance. As a result, estimates of the insurance cost of the disaster are about $10 billion. The losses to the various national economies may also not exceed $10 billion.

Aceh, the Indonesian province where up to 100,000 people may have been killed, accounts for only about 2 percent of the country's gross domestic product. Thailand's southern provinces, which were overrun by the tsunami, contribute only about 2 percent of the country's G.D.P.

Sri Lanka, however, suffered extensive damage to its tourism, fishing and agricultural sectors. Tourism is a major industry there, directly or indirectly accounting for nearly 11 percent of gross domestic product, and the devastation in southern Sri Lanka could reduce G.D.P. by 2 percent to 3 percent this year. The regional impact will be modest, though, because Sri Lanka's economy is only about $74 billion compared with $478 billion for Thailand and $759 billion for Indonesia.

Thailand and Indonesia could suffer greater economic losses if their tourism industries decline; tourism is 12 percent of Thailand's economy and 10 percent of Indonesia's. But as the terrorist attack in Bali in 2002 and the SARS epidemic in 2003 demonstrated, shock events do not usually affect tourism for longer than a few months if people perceive that danger has passed. In fact, Thai hotel stocks declined on the day after the tsunami but have since recovered.

Earthquakes have also generated great political shocks. An earthquake in November 1755 destroyed Lisbon and killed at least 60,000 people. It also encouraged Portugal's foreign minister, Sebastião de Carvalho, to usurp power from the king and launch a campaign against the Roman Catholic Church. Carvalho effectively reigned over Portugal until 1777.

In 1972, an earthquake in Nicaragua helped to nurture an incipient revolution against the ruling Somoza family. Outraged at the government's response to the catastrophe, many Nicaraguans in Managua turned to the Sandinistas, who ousted the Somozas in 1979.

Last month's earthquake could have important political implications because it struck regions in Indonesia and Sri Lanka that are home to domestic insurgent groups. Separatists in Aceh and Tamils in Sri Lanka have been challenging their governments for more than 20 years. The Indonesian government was initially slow to deploy aid, and many soldiers ran from the scene of the disaster, which could affect the standing of the new president, Susilo Bambang Yudhoyono, who had been promising to improve government efficiency. The Sri Lankan government, meanwhile, has allowed international aid agencies to coordinate relief with the Tamil separatists.

There is precedent for an earthquake encouraging political reconciliation. In 1999, earthquakes struck Turkey and Greece just a month apart and fostered cooperation between the two nations. The Turkish quake devastated an industrial city and killed more than 15,000 people; the Greeks sent relief and received positive news media coverage in Turkey. When a milder earthquake struck Greece a month later, Turkey reciprocated by sending aid.

The great risk in Aceh today is mismanagement of the reconstruction process. The Indonesian military has ruled the province since the fall of President Suharto in 1998 and has excluded foreign journalists. Since the earthquake, however, the province has been overrun with the global press and inundated with international relief agencies. When more foreign aid arrives, the Indonesian military could try to steal it. The presence of the United Nations could also encourage the Aceh separatists to demand more democracy in the province and even a referendum on independence. It would be a shame if the tsunami destabilized the administration of President Yudhoyono only a few months after he assumed office as a result of the country's first democratic presidential election.

The American press has been full of stories about how American aid for the earthquake and tsunami victims could help to improve American relations with the region. Public and private donations to the region from the United States could exceed $600 million. There is little doubt that the United States is playing a leadership role along with Japan, which has pledged $500 million, and the European Union, which has pledged $580 million. The new rising power in the region, China, is offering only $63 million.

What is unclear is whether Asians will regard the American aid as a truly transforming event or as a temporary burst of generosity from an aggressive superpower. Much may depend upon the follow-through. There is talk in Washington of capitalizing on the disaster by intensifying efforts to obtain a free trade agreement with Thailand and revive moribund talks about such an agreement with Sri Lanka. These developments could have a more lasting impact than the aid itself.

IN the 19th century, Indonesia was the site of two great volcanic eruptions whose impact was felt worldwide. The eruption at Tambora in 1815 killed at least 50,000 and spewed so much ash into the atmosphere that it produced a global cooling that caused frosts in New England in the summer of 1816. The eruption at Krakatoa in 1883 wiped out more than 160 villages and killed at least 36,000 people. The explosion was so loud it was heard in Perth, Australia, thousands of miles away.

The most enduring legacy of last month's tsunami may be the role of technology in providing relief. Because of the Internet, thousands of people were able to wire money to charities and aid agencies immediately. Ten years ago, it would have taken several days or weeks for checks to come in the mail. The prompt response shows that globalization can be a force for good. The challenge will be to ensure that the world remains focused on the recovery after the tragedy fades from the headlines.

David Hale, an economist and financial adviser, is chairman of China Online, a business news site.

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've been thinking of writing a political novel. It will be a bad novel because there won't be any nuance: the villains won't just espouse an ideology I disagree with - they'll be hypocrites, cranks and scoundrels.

In my bad novel, a famous moralist who demanded national outrage over an affair and writes best-selling books about virtue will turn out to be hiding an expensive gambling habit. A talk radio host who advocates harsh penalties for drug violators will turn out to be hiding his own drug addiction.

In my bad novel, crusaders for moral values will be driven by strange obsessions. One senator's diatribe against gay marriage will link it to "man on dog" sex. Another will rant about the dangers of lesbians in high school bathrooms.

In my bad novel, the president will choose as head of homeland security a "good man" who turns out to have been the subject of an arrest warrant, who turned an apartment set aside for rescue workers into his personal love nest and who stalked at least one of his ex-lovers.

In my bad novel, a TV personality who claims to stand up for regular Americans against the elite will pay a large settlement in a sexual harassment case, in which he used his position of power to - on second thought, that story is too embarrassing even for a bad novel.

In my bad novel, apologists for the administration will charge foreign policy critics with anti-Semitism. But they will be silent when a prominent conservative declares that "Hollywood is controlled by secular Jews who hate Christianity in general and Catholicism in particular."

In my bad novel the administration will use the slogan "support the troops" to suppress criticism of its war policy. But it will ignore repeated complaints that the troops lack armor.

The secretary of defense - another "good man," according to the president - won't even bother signing letters to the families of soldiers killed in action.

Last but not least, in my bad novel the president, who portrays himself as the defender of good against evil, will preside over the widespread use of torture.

How did we find ourselves living in a bad novel? It was not ever thus. Hypocrites, cranks and scoundrels have always been with us, on both sides of the aisle. But 9/11 created an environment some liberals summarize with the acronym Iokiyar: it's O.K. if you're a Republican.

The public became unwilling to believe bad things about those who claim to be defending the nation against terrorism. And the hypocrites, cranks and scoundrels of the right, empowered by the public's credulity, have come out in unprecedented force.

Apologists for the administration would like us to forget all about the Kerik affair, but Bernard Kerik perfectly symbolizes the times we live in. Like Rudolph Giuliani and, yes, President Bush, he wasn't a hero of 9/11, but he played one on TV. And like Mr. Giuliani, he was quick to cash in, literally, on his undeserved reputation.

Once the New York newspapers began digging, it became clear that Mr. Kerik is, professionally and personally, a real piece of work. But that's not unusual these days among people who successfully pass themselves off as patriots and defenders of moral values. Mr. Kerik must still be wondering why he, unlike so many others, didn't get away with it.

And Alberto Gonzales must be hoping that senators don't bring up the subject.

The principal objection to making Mr. Gonzales attorney general is that doing so will tell the world that America thinks it's acceptable to torture people. But his confirmation will also be a statement about ethics.

As White House counsel, Mr. Gonzales was charged with vetting Mr. Kerik. He must have realized what kind of man he was dealing with - yet he declared Mr. Kerik fit to oversee homeland security.

Did Mr. Gonzales defer to the wishes of a president who wanted Mr. Kerik anyway, or did he decide that his boss wouldn't want to know? (The Nelson Report, a respected newsletter, reports that Mr. Bush has made it clear to his subordinates that he doesn't want to hear bad news about Iraq.)

Either way, when the Senate confirms Mr. Gonzales, it will mean that Iokiyar remains in effect, that the basic rules of ethics don't apply to people aligned with the ruling party. And reality will continue to be worse than any fiction I could write.

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warthmore, Pa.

THERE are three arguments being made in favor of privatizing part of Social Security. First, the Social Security Trust Fund needs money and privatization will, in the long run, increase the amount of money available to retirees. Second, privatization will give people choice, and choice is good. And third, "it's your money," and you ought to be able to do with it as you wish.

Each of these arguments is dubious, or disingenuous, or both.

Though experts differ on the urgency and the severity of the problem, most everyone agrees that the trust fund will eventually run out of money unless we do something. Two obvious and painful things we can do are decrease benefits or increase payroll taxes. Privatization, it is argued, solves the problem without the pain. Equity investments return about twice as much, historically, as Treasury bills. So by allowing people to put some of their payroll taxes into equity investments, we will increase the value of that part of their retirement account so we can then decrease the benefits paid out by the standard Social Security program and still leave retirees better off.

There are several problems with this argument, however. For starters, there is no guarantee that equities will return more than Treasury bills. One of the reasons that equities have a higher rate of return than other types of investments is that investors have to be compensated for taking risks. Perhaps equities will outperform Treasury bills in the long term but that doesn't mean that they will be outperforming Treasury bills at the specific moment you retire.

For example, a person who retired in 2000 after a lifetime of investing half in stocks and half in bonds would have had 50 percent more in his account than a person making the same investments who retired in 2003. A difference like this could mean that the lucky retiree can afford both food and medicine while the unlucky one must choose between them. The risk inherent in equity investments is unavoidable unless you can leave the investment alone indefinitely, which, of course, most retirees can't do.

What's more, the administrative costs of keeping track of these private accounts, according to President Bush's Commission to Strengthen Social Security, will be 10 to 30 times the cost of administering the current system, eating up almost all of the hypothetical gains that equity investments could provide.

Finally, even if we grant the advantages of putting trust fund money into equities, this is something that the government could do without privatizing anything by doing the investing itself. The government as investor can ride out risks better than any individual investor, and administrative costs would be vastly reduced. Only brokerage houses would suffer - from lost commissions. Thus investing in equities, which might be a good idea, is logically independent of privatization, which is a bad one. The Bush administration is deliberately conflating them.

This brings us to the second argument in favor of privatizing Social Security: giving people options makes them better off. There is now accumulating evidence that choice isn't always good. Whether people are choosing jam in a grocery store, essay topics in a college class, or even potential partners in an evening of "speed dating," the more options they have, the less likely they are to make a choice. In other words, increasing options induces people to opt out of choosing altogether, and this comes into play when people decide how to invest their money for retirement.

A study by Sheena Iyengar, a psychologist, and Wei Jiang, an economist, has shown that when employers increase the number of funds available to employees for voluntary 401(k) investments, the rate of participation goes down by 2 percent for every 10 funds offered. And this is true even when participating employees get free money - matching money - from employers.

So whereas there is no denying that choice is sometimes good, a case must be made for the specific benefits of choice in each particular context, rather than just assuming that the more choice people have, the better off they are. The appropriately abysmal early public response to the administration's Medicare prescription drug choice plan provides ample reason to suspect that many people will not regard being able to choose their Social Security investment instruments as a blessing.

This brings me to the final defense of privatization: the payroll taxes you pay are your money, and you ought to be able to do what you like with your money. This, I suspect, is the real justification behind the move to privatize, and it is the worst reason of all. The payroll tax is not "your" money; it's our money. Social Security was created as an insurance scheme, not a pension scheme. It was meant to provide a safety net, to protect the unlucky from immiseration in old age. The benefits we get are not payouts from accounts in which we have accumulated our own private stash. What we get is largely determined by what we earned, but we keep getting it even after we've taken out every penny we put in. And if we happen to die early, someone else reaps the benefits of our contributions.

The Bush administration should be honest with the American people and ask us if we want to do away with Social Security, without pretending that privatization will solve the problem of financing the trust fund without pain. I suspect that the American people would reject this effort to transform their "old-age insurance" into another opportunity to roll the dice in the investment casino.

Barry Schwartz, a professor of psychology at Swarthmore College, is the author of "The Paradox of Choice: Why More Is Less."

ashington — IF President Bush truly wants a bipartisan agreement on Social Security reform, he should recognize that he can keep the system solvent, increase savings and promote his ownership agenda without dividing Washington by carving Social Security into private accounts.

The president can promote the individual ownership he wants and protect the guaranteed Social Security benefits Democrats insist on with a new universal 401(k) that offers all Americans a private retirement account in addition to Social Security, and uses government funds to match contributions made by moderate and lower-income workers.

A universal 401(k) would increase savings far more than partly privatizing Social Security. Privatization that simply allocates part of the current 12.4 percent Social Security payroll tax for employees to invest in private accounts does nothing to increase national savings: it's like taking $1,000 a year from your parent's 401(k) and putting it in your own individual retirement account. Allowing people to invest some of their Social Security payroll taxes in the market simply adds risk to the one risk-free leg of the retirement stool. If instead people could invest in universal 401(k) accounts - in addition to Social Security - that provided new incentives to those families having the hardest time putting money away, America would actually leverage new savings, not just shift existing savings around.

Such accounts would also help remedy America's upside-down tax incentives for retirement savings. Taxpayers in the highest income bracket, 35 percent, not only are more likely to get a matching contribution for their savings from a 401(k) at work, but also get to deduct 35 cents from their taxes for each dollar saved in their 401(k). Meanwhile, most working families in the 15 percent bracket do not get matching contributions from an employer-sponsored pension - and when they do save they get only a 15-cent deduction for each dollar.

A universal 401(k) would give the greatest matching tax incentives to those who need the most help saving, with a dollar-for-dollar match by the government for initial contributions by moderate-income workers and even more for the working poor. A universal 401(k) could further promote savings if financed in a fiscally responsible manner - say, by raising the estate-tax exemption to $5 million per couple from today's $3 million, but avoiding the outright repeal scheduled under current law. For every wealthy estate that faced higher taxes, more than 5,000 Americans would get a tax cut to help them save and someday build an estate of their own.

To win Democratic support for a Social Security fix, President Bush must also commit to mutual sacrifice. The administration's tax cuts already save the richest 1 percent of Americans nearly $100 billion a year, an amount that over time would keep Social Security solvent for 75 years. Before President Bush can ask Democrats to go along with any tax or benefit changes that affect average Americans, he needs to ask this most fortunate group to help bear the burden of reform.

The president should propose a 3 percent surcharge on all income over $200,000 - whether from earnings, dividends or capital gains - and use the money to increase national savings now and help keep Social Security solvent. He could make the deal contingent on a bipartisan agreement to find equivalent savings to shore up Social Security through measured revenue and benefit changes.

This strategy would require real compromise. But if the president wants to strengthen savings, promote his "ownership society" and keep Social Security solvent, he could use these measures to light the way to the bipartisan agreement he needs.

Gene Sperling, a senior fellow at the Center for American Progress, was national economic adviser to President Bill Clinton from 1997 to 2001.

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he people who hustled America into a tax cut to eliminate an imaginary budget surplus and a war to eliminate imaginary weapons are now trying another bum's rush. If they succeed, we will do nothing about the real fiscal threat and will instead dismantle Social Security, a program that is in much better financial shape than the rest of the federal government.

In the next few weeks, I'll explain why privatization will fatally undermine Social Security, and suggest steps to strengthen the program. I'll also talk about the much more urgent fiscal problems the administration hopes you won't notice while it scares you about Social Security.

Today let's focus on one piece of those scare tactics: the claim that Social Security faces an imminent crisis.

That claim is simply false. Yet much of the press has reported the falsehood as a fact. For example, The Washington Post recently described 2018, when benefit payments are projected to exceed payroll tax revenues, as a "day of reckoning."

Here's the truth: by law, Social Security has a budget independent of the rest of the U.S. government. That budget is currently running a surplus, thanks to an increase in the payroll tax two decades ago. As a result, Social Security has a large and growing trust fund.

When benefit payments start to exceed payroll tax revenues, Social Security will be able to draw on that trust fund. And the trust fund will last for a long time: until 2042, says the Social Security Administration; until 2052, says the Congressional Budget Office; quite possibly forever, say many economists, who point out that these projections assume that the economy will grow much more slowly in the future than it has in the past.

So where's the imminent crisis? Privatizers say the trust fund doesn't count because it's invested in U.S. government bonds, which are "meaningless i.o.u.'s." Readers who want a long-form debunking of this sophistry can read my recent article in the online journal The Economists' Voice (www.bepress.com/ev).

The short version is that the bonds in the Social Security trust fund are obligations of the federal government's general fund, the budget outside Social Security. They have the same status as U.S. bonds owned by Japanese pension funds and the government of China. The general fund is legally obliged to pay the interest and principal on those bonds, and Social Security is legally obliged to pay full benefits as long as there is money in the trust fund.

There are only two things that could endanger Social Security's ability to pay benefits before the trust fund runs out. One would be a fiscal crisis that led the U.S. to default on all its debts. The other would be legislation specifically repudiating the general fund's debts to retirees.

That is, we can't have a Social Security crisis without a general fiscal crisis - unless Congress declares that debts to foreign bondholders must be honored, but that promises to older Americans, who have spent most of their working lives paying extra payroll taxes to build up the trust fund, don't count.

Politically, that seems far-fetched. A general fiscal crisis, on the other hand, is a real possibility - but not because of Social Security. In fact, the Bush administration's scaremongering over Social Security is in large part an effort to distract the public from the real fiscal danger.

There are two serious threats to the federal government's solvency over the next couple of decades. One is the fact that the general fund has already plunged deeply into deficit, largely because of President Bush's unprecedented insistence on cutting taxes in the face of a war. The other is the rising cost of Medicare and Medicaid.

As a budget concern, Social Security isn't remotely in the same league. The long-term cost of the Bush tax cuts is five times the budget office's estimate of Social Security's deficit over the next 75 years. The botched prescription drug bill passed in 2003 does more, all by itself, to increase the long-run budget deficit than the projected rise in Social Security expenses.

That doesn't mean nothing should be done to improve Social Security's finances. But privatization is a fake solution to a fake crisis. In future articles on this subject I'll explain why, and also outline a real plan to strengthen Social Security.

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f you've lent even one ear to the administration's recent comments on Social Security, you have no doubt heard President Bush and his aides asserting that a $10 trillion shortfall threatens the retirement system - and the economy itself. That $10 trillion hole is the basis of the president's claim last month that "the [Social Security] crisis is now." It's also the basis of the administration's claim that the cost of doing nothing to reform the system would be far greater than the cost of acting now.

Well, the $10 trillion figure is the closest you can get to pulling a number out of the air. Make that the ether. Starting last year, as the groundwork was being set for the emerging debate, the Social Security trustees took the liberty of projecting the system's solvency over infinity, rather than sticking to the traditional 75-year time horizon. That world-without-end assumption generates the scary $10 trillion estimate, and with it, Mr. Bush's putative rationale for dismantling Social Security in favor of a system centered on private savings accounts. The American Academy of Actuaries, the profession's premier trade association, objected to the change. In a letter to the trustees, the actuaries wrote that infinite projections provide "little if any useful information about the program's long-range finances and indeed are likely to mislead any [nonexpert] into believing that the program is in far worse financial condition than is actually indicated."

As it often does with dissenting professional opinion, the administration is ignoring the actuaries. But that doesn't alter the facts or common sense. If the $10 trillion figure is essentially bogus, so is the claim that Social Security is in crisis. The assertion that doing nothing would be costlier than enacting a privatization plan also turns out to be wrong, by the estimates of Congress's own budget agency.

Over a 75-year time frame, Social Security's shortfall is estimated by the Congressional Budget Office at $2 trillion and by the Social Security trustees at $3.7 trillion, a manageable sliver of the economy in each case. If the shortfall is on the low side, Social Security will be in the black until 2052, when it will be able to pay out 80 percent of the promised benefits. If it is on the high side, the system will pay full benefits until 2042, when it will cover 70 percent.

Contrary to Mr. Bush's frequent assertion that Social Security is constantly imperiled by political meddling, it has in fact been preserved and improved by political intervention throughout its 70-year history, most significantly in 1983. The system could - and should - be strengthened again by a modest package of benefit cuts and tax increases phased in over decades.

Instead, the administration wants workers to divert some of the payroll taxes that currently pay for Social Security into private investment accounts, in exchange for a much-reduced government benefit. To replace the taxes it would otherwise have collected - money it needs to pay benefits to current and near retirees - the government would borrow an estimated $2 trillion over the next 10 years or so and even more thereafter.

In effect, the administration's plan would get rid of the financial burden of Social Security by getting rid of Social Security. The plan shifts the financial risk of growing old onto each individual and off of the government - where it is dispersed among a very large population, as with any sensible insurance policy. In a privatized system, you may do fine, but your fellow retirees may not, or vice versa.

In any event, doing well under privatization is relative. Congress's budget agency analyzed the privatized plan that is widely regarded as the template for future legislation and found that total retirement benefits - including payouts from the private account plus the government subsidy - would be less than under the present system. The amount available from the privatized system was less even after midcentury, when the current system is projected to come up short.

It should come as no shock that individual investors might not do as well as hoped. The stock market's historical returns - some 7 percent a year - are predicated on a hypothetical investor who bought an array of stocks in the past, reinvested all dividends, never cashed in and never paid commissions or fees. That's not how investing works in the real world. An especially grave danger is that investors would withdraw their funds before retirement, a pattern that is pronounced in 401(k) plans. It would be politically very difficult to refuse people access to accounts that were sold to them on the premise that they - not the government - would own them.

The Congressional Budget Office analysis also likely understates the costs to individuals of privatizing Social Security. The borrowing that would be needed to establish private accounts could lead to higher interest rates, a weaker dollar and slower economic growth. It is also likely that future tax hikes would be required to cover the interest payments on the additional national debt.

The only hands-down winner would be Wall Street, as fees to manage millions of accounts poured in. (Those fees, not incidentally, would come out of your return.) Current stockholders would also stand to benefit, as increased demand pushed up stock prices, giving existing owners a gain at the expense of newcomers who would be forced to buy high. The affluent, who could afford professional investing advice, would also be advantaged, even though everyone would be taking the same risks.

The zeal over privatization is fueled by the belief of Mr. Bush and his supporters that free-market fixes are appropriate for virtually every problem. That faith is misguided. For a society to be functional and humane, it's not enough that some people have a chance to be rich in old age. Rather, all old people must have the dignity of financial security, and that requires universal coverage.

Social Security is the core tier of old-age support, replacing about a third of preretirement income for a typical retiree and providing inflation-proof income for life - a feature not available in private accounts. Its purpose is not to supplant other retirement investing, but to provide a crucial safety net. Anyone who wants to maintain his or her standard of living into old age must also amass substantial personal savings and investments. To introduce the same risk into the core tier of benefits that already exists for the bulk of one's retirement savings would be as unfair as it is unwise.

If Mr. Bush were not so serious about privatizing Social Security, his urgency would be silly. Compared with other challenges looming for the government, it's a non-problem. The shortfall in the Medicare hospital insurance fund is two to three times the size of the Social Security shortfall, and that fund is projected to be insolvent some two to three decades before Social Security. Taken together, the costs of the Medicare prescription benefit and of making the tax cuts permanent - Mr. Bush's two main domestic initiatives - are 5 to 8.5 times larger. And his hair is on fire over Social Security?

One of the most distressing aspects of the debate over Social Security privatization is that it distracts from more pressing issues and obscures better solutions to the problem of secure retirement. A future editorial will discuss new strategies to increase private savings outside of Social Security that draw on market theory and behavioral economics and are more promising than rehashing the same tired formula of tax-sheltered savings accounts. In the meantime, however, Mr. Bush and his supporters will be pursuing their idée fixe of privatization. It's bad policy. And it's bad politics, too, driven by reflex, ideology and special interests, and sustained by conformism that masquerades as party discipline. Lawmakers who still value their right and obligation to think for themselves - and to act in the best interest of their constituents - must champion solutions that will build on Social Security, not undermine it.