"No," said former Fox News journalist Tony Snow, newly appointed as one of George W. Bush’s closest aides, his Press Secretary, when asked recently about his retirement savings. “As a matter of fact, I was even too dopey to get in on a 401(k). So there is actually no Fox pension. The only media pension I have is through AFTRA.”
A 401(k) is a heavily tax-favored account in which workers can save money for their retirement. Typically, employers – including Fox News – match workers’ 401(k) contributions, so setting up a 401(k) is an irresistible financial deal, a true no-brainer. Yet Tony Snow didn’t. Only the union he was forced to join, the American Federation of Television and Radio Artists, has been doing any formal saving and earmarking of his retirement assets.
Snow’s case, I think, holds very important lessons, and not just for the United States. To the extent that the Bush administration has a coherent philosophy for domestic policy, it is the idea of the “ownership society” – the belief that intermediary institutions, whether governments, unions, or the benefits departments of companies, should get out of the business of providing social insurance. Instead, individuals should rely on their own assets to provide them with financial security in retirement or in case of serious illness. Give people the incentives to plan for their future, ownership-society advocates argue, and they will.
In the future, Snow will have to stand up at the podium in the White House briefing room and advocate the various components of Bush’s ownership-society proposals. He will have to praise Health Security Accounts – and argue that people won’t stop going to the doctor for preventive care even if their HSA-tied insurance plan doesn’t pick up any of the bills. He will have to praise privatization of Social Security – and argue that individuals will make prudent and wise investment decisions with this baseline tranche of their potential retirement resources. And he will have to praise the decline of unions and the shedding of benefits by firms – and argue that individuals will make better choices than union experts or firms’ benefit departments.