NOT IMPRESSED….Ohio was Bamboozlepalooza central on Friday, but the loyal few who were allowed to attend Bush’s invite-only propaganda ploy were not terribly impressed. It seems they’ve spent some time in the reality-based community.
KIRTLAND, Ohio ? President Bush came to Ohio on Friday to highlight a state retirement savings system that he said showed that Americans would be better off handling their own old-age investments through personal accounts than relying on traditional Social Security.
But that state’s version of personal accounts has attracted few takers among the people eligible ? Ohio’s 750,000 public employees. And records show that the most widely chosen version of the state-offered accounts has racked up a five-year earning record of 1.86%, about the same return that the president says Social Security produces.
“Boy, does he have a hard sell ahead of him in using Ohio as his example,” said Keith Brainard, research director of the National Assn. of State Retirement Directors…
Here’s an illustration of how well Ohio’s privatization worked.
But in the biggest of the state’s plans ? the 522,000-member Ohio Public Employees Retirement System, or OPERS ? the personal account option has not proven particularly popular among state workers, or delivered a particularly good rate of return.
About 10,000 of those eligible for personal accounts ? less than 5% ? have signed up for the accounts since they became available at the start of 2003, according to Laurie Fiori Hacking, OPERS’ executive director.
Of those who have chosen the accounts, most have directed that their money be invested in the system’s “moderate” or “aggressive” pre-mixed portfolios, according to spokesman Richard Baker.
OPERS records show that the “moderate” account lost money in two of the last four years and during the first three months of this year. It posted a five-year annualized return of 1.86%.
That compares to the 1.8% that Bush said Friday was the rate of return for Social Security.
The OPERS “aggressive” portfolio had a five-year return of 0.26%.
By contrast, the fund that pays for the system’s traditional pensions, which is handled by professional money managers, had a five-year return of 3.52%.
Well, yeah, I can see way the good people of Ohio are not totally stoked about Bush’s privatization scheme. So, why hasn’t this Ohio system made its way into a political ad yet?