The former chairman of Dow Jones, Warren Phillips, used to joke that the differences between the Wall Street Journal’s editorial page and its news coverage meant that Journal readers were getting two newspapers for the price of one. Even by those standards, though, the Journal let loose a whopper yesterday by leading the newspaper, under a two-column headline in the top right-hand corner of page one, with a dispatch attacking President Bush’s plan to allow young workers to invest some of their Social Security money in personal accounts.

The story, which begins, “If President Bush has his way,” is framed as “a look at the challenges” that Mr. Bush’s plan could present, and as a report of the “lesson” that our experience with 401(k) plans has for Social Security. “There’s evidence that 401(k) performance isn’t measuring up to the performance of professionally managed pension plans,” the Journal reports, citing a study purporting to show that over 10 years ending in 2002,”the median return on pension funds held by companies that also offered self-managed 401(k) plans averaged 6.81% a year, compared with 6.35% for the 401(k) plans.” Over 30 years, the performance gap between the professional pension manager and the account managed by an individual employee would mean an $88,000 difference in returns on a $100,000 investment, the Journal says.

That’s all fine information for employees deciding whether to choose between the increasingly rare old-fashioned pension fund and a 401(k) plan. But that’s not the choice facing most younger workers or the policy-makers weighing Social Security reform. The choice they face is between a personal savings account that, if the pattern cited by the Journal holds, earns 6.35% a year – and a Social Security system where taxes paid in earn an implicit return of 1% or 2% a year for younger workers. In other words, the relevant comparison isn’t between 6.81% and 6.35%; it’s between 1% and 6.35%.

The Journal goes on to quote Alicia Munnell, identified as “director of Boston College’s Center for Retirement Research” as saying that 401(k) plans in which workers invest their own assets “are simply too complicated for people to handle.” The Journal doesn’t disclose to readers that Ms. Munnell was a political appointee of President Clinton in the Treasury Department and the Council of Economic Advisers, a fact that might be of some interest to readers weighing her analysis of one of Mr. Bush’s top second-term domestic policy initiatives.

If all that weren’t enough, readers turning inside the paper for a continuation of the front-page story find a column by John Harwood asserting that Mr. Bush lacks a mandate for specific steps on Social Security reform. Never mind that Mr. Bush won the election after speaking of the issue in his speech at the Republican National Convention and after withstanding a barrage of Kerry campaign commercials designed to scare seniors into thinking Mr. Bush would cut their Social Security benefits.

Personal savings accounts as part of Social Security would be a boon for Wall Street. It’s hard to see why such a hardheaded newspaper would be so groundlessly downbeat about it when the newspaper is based in America’s financial capital and named for the very street that symbolizes the idea that individuals know better than the government what’s in their own investment interest.