And the Semantic Hits keep on comin' - Life Cycle Accounts

Laura Meckler from the AP has joined the fray of journalists contradicting themselves in their stories today. Not only that but it seems the Republican pollsters have come up with a new term...

drumroll please

LIFE CYCLE ACCOUNTS

President Bush's advisers have settled on a proposal for structuring the personal accounts they hope to create in Social Security, while on Capitol Hill Senate Democrats were launching an effort to defeat the plan altogether.

Under a plan recommended to Bush, the private accounts would resemble many company-sponsored retirement plans, with just a handful of investment options.

By default, workers would be enrolled in a "life cycle" account, in which investments become more conservative as investors age, if they do not choose one of the other options, according to two officials speaking on condition of anonymity.

Further down the plan is described to be more like the Thrift Savings Plan that government workers have:

Under the Thrift Savings Plan, federal workers have five investment options, including government and corporate bond funds, a stock fund that tracks the S&P 500, an international fund and other stock funds.

Under the emerging Bush plan for Social Security, the default investment would be a "life cycle" account. It would begin with investments that have greater potential for both risk and reward and shift to safer bonds as a worker ages, officials in and outside the administration said.

The government would be responsible for keeping track of how much money is in each worker's account and give the lump sums to a financial services company to invest, a mechanism aimed at keeping administrative fees low, they said.

So much for the government getting out of your business and starting an "ownership" society.