One of the big boasts of the Obama campaign is that they've attracted youth like never before. They're registering in record numbers, they're active in campaigning like never before, and the turnout is going to be like nothing we've seen in previous elections.
Take a look at this from the Weekly Standard blog:
Given the hype of the Obama candidacy and his campaign's massive mobilization effort, will America's youth deliver for “The One?”
Millennial voters certainly have a lot of encouragement this year. As Tom Edmunds points out in this recent piece in Politics magazine:
Judging from all the hype, you'd think that the Illinois senator is poised to surf into office on a cresting tsunami of the youth vote. Labeled the “Year of the Youth Vote” by Time magazine, called “The Year the Youth Vote Arrives” by Washington Post columnist E.J. Dionne, 2008 is supposedly when the wireless and digitized Millennial generation will register its power by selecting Obama as the next commander-in-chief.
But according to a new report released by Gallup, all the hullabaloo about Obama's appeal to younger Americans is a bit overblown. A couple surprising findings:
First, Obama isn't polling much better among young voters than John Kerry was in 2004:
This strength of support for a Democratic presidential nominee among the youth is not a new phenomenon. In Gallup's final poll before the 2004 election, the Democratic nominee John Kerry received 59% of the support of 18- to 29-year-old registered voters, while the Republican George W. Bush received 36% support. That compared to the overall sample of registered voters in which Kerry was leading Bush by 2 points, 48% to 46%. (Bush led Kerry among likely voters by 49% to 47%.)
Of course turnout matters here too. Getting 60 percent of a bigger slice of electoral pie could help. Yet Gallup raises these questions about turnout:
Gallup Poll daily tracking suggests that 18- to 29-year-olds are not nearly as likely as older voters to be registered to vote, to say they are thinking about the election, or to express strong intentions to vote. Thus, as of mid-October, there is not convincing evidence in the Gallup data that young voters will in fact vote at higher rates than in past elections.
Edmunds may be right when he concludes:
But the vision for the near term seems very clear. 2008 will once again be a year in which the anticipated youth vote did not materialize.
A loss of that youth vote would probably explain why Obama has suddenly begun the standard Democrat tactic of scaring senior citizens. A new ad claims McCain's health care plan will not only tax health care benefits, but also massively cut Medicare benefits. I've heard these ads in Missouri many times over the past few days. The thing is, this ad is utterly false, and even the marginally unbiased Factcheck.org called it a 'rank distortion'.
This is yet another sign of just how NOT over this election is. If the Democrats are having to re-evaluate their strategy for constituencies they've been counting on, they've got problems.
In contrast to the false ads against McCain's health care plan, Obama and the Democrats are looking into the possibility of looting your 401k:
House Democrats recently invited Teresa Ghilarducci, a professor at the New School of Social Research, to testify before a subcommittee on her idea to eliminate the preferential tax treatment of the popular retirement plans. In place of 401(k) plans, she would have workers transfer their dough into government-created “guaranteed retirement accounts” for every worker. The government would deposit $600 (inflation indexed) every year into the GRAs. Each worker would also have to save 5 percent of pay into the accounts, to which the government would pay a measly 3 percent return. Rep. Jim McDermott, a Democrat from Washington and chairman of the House Ways and Means Committee's Subcommittee on Income Security and Family Support, said that since “the savings rate isn't going up for the investment of $80 billion [in 401(k) tax breaks], we have to start to think about whether or not we want to continue to invest that $80 billion for a policy that's not generating what we now say it should.”
A few respectful observations:
1) McDermott is right when he says the savings rate isn't going up. But the savings rate doesn't include gains to money you invest in the stock market. It ignores the buildup of net worth. (If you bought a share of XYZ Corp. in January at $100, for instance, and its value doubled by December, the savings rate measure would still value that investment at $100. In short, the savings rate is a phony number.)
2) So based partly on the above faulty logic, the $4.5 trillion, as of the start of the year, invested in 401(k) plans doesn't count as savings.
3) Ghilarducci would have workers abandon the stock market right at the bottom of the market. A stupid idea, according to Warren Buffett: “I don't like to opine on the stock market, and again I emphasize that I have no idea what the market will do in the short term. Nevertheless, I'll follow the lead of a restaurant that opened in an empty bank building and then advertised: 'Put your mouth where your money was.' Today my money and my mouth both say equities.”
4) Ghilarducci would offer a lousy 3 percent return. The long-run return of the stock market, adjusted for inflation, is more like 7 percent. Look at it this way: Ten thousand dollars growing at 3 percent a year for 40 years leaves you with roughly $22,000. But $10,000 growing at 7 percent a year for 40 years leaves you with $150,000. That is a high price to pay for what Ghilarducci describes as the removal of “a source of financial anxiety and…fruitless discussions with brokers and financial sales agents, who are also desperate for more fees and are often wrong about markets.” Please, I'll take a bit of worry for an additional $128,000.
5) What effect would this plan have on an already battered stock market? Well, I would imagine it would send it even lower, sticking a shiv into the portfolios of everyone who didn't jump aboard. But I am sure the Chinese would love to jump in and buy all our cheap stocks to fund the retirement of their citizens.
My bottom line: If you believe in the long-run dynamism of the American economy, then you have to believe in the stock market. Listen to superinvestor Buffett, not the prof from the New School.
But don't worry…they're just looking for more ways to spread your wealth around.
These Democrats are not just economically irresponsible, they are economically dangerous. Don't buy their lies, and don't let them get away with stealing your private retirement savings.
There's my two cents.