There is an article in today's (Oct 13 2002) New York Times about how the
California Public Employees' Retirement System (Calpers) may be investing its
funds to achieve left-wing political objectives rather than maximize
risk-adjusted returns, which is its fiduciary responsibility. If the fund
underperforms, California taxpayers will be on the hook.

There is less talk about investing Social Security funds in the stock market
than there was two years ago, for obvious reasons. I think the article
highlights the advantage of individual accounts in which people can choose a
stock or bond mutual fund, rather than a government-run stock fund that some
have suggested as an alternative. Proponents of Social Security directly
investing in the stock market claim that it can be insulated from poltical
pressure, but that is unlikely in the long run.