Many supporters of Social Security reform are already declaring it a lost cause. Columnist Charles Krauthammer says the idea “isn’t dead, but it’s pretty sick.” Fred Barnes of the Weekly Standard says President Bush needs an “exit strategy” because “it’s hard to see how a reform measure can pass.” Bill Kristol, editor of the Standard, says that if the White House is “willing to unwind the Social Security proposal and accept defeat sometime this year, it won’t do them any damage” in next year’s elections.

All of this gloom is premature. There are ways for Mr. Bush to turn the political tables on his opponents. He made a start by endorsing the progressive indexing of Social Security benefits, which would ensure the bottom 30% of wage earners would all get benefits that lift them above the poverty line. He could combine that with a bold move to protect the $2.2 trillion in Social Security surpluses flowing into the system over the next nine years from being “raided” by a spendthrift Congress.

One way to do that would be to create a true “lockbox” that allows people to put their share of the surplus into their own personal account to help fund their retirement. But the account would be limited to no-risk, but marketable, Treasury bills. Every taxpayer who voluntarily chose to create a T-Bill personal account would, in effect, own the key to his own lockbox, containing a significant chunk of their future benefits. The surpluses would become real assets owned by citizens rather than government IOUs – or, more accurate, “I owe me’s”- piling up in a filing cabinet in a federal office in West Virginia.

Everyone knows that if nothing is done Congress – regardless of which party controls it – will spend every penny of the Social Security surpluses that will flow into the Treasury until 2017, after which the cost of benefits going out will begin exceeding the revenue coming in. Those surpluses will not go into a true “trust fund” with real assets, but instead into those IOUs, which David Walker, head of the Governmental Accountability Office, says “give a very false sense of security about where we are and how much time we have” until insolvency. Converting the non-marketable IOUs the government now holds into marketable Treasury bills issued to taxpayers would create an asset that individuals would own and be able to pass on to their heirs. If history is a guide, the risk-free accounts would earn an annual rate of return of between 2.5% and 3% – much better than Social Security will deliver.

Politically, such a move would change the conversation and could break the logjam blocking reform. Mr. Bush has made some headway in recent weeks convincing the American people there is a Social Security problem. But he has failed to convince Democrats in Congress that they would pay a price for opposing reform. He must move quickly from a theoretical plan Democrats can attack as “privatization” to a concrete one which allows him to explain the benefits. What if Bush forced Congress to vote on a plan that protected the most vulnerable wage earners, put the Social Security surpluses of the next dozen years out of the reach of politicians, and put those funds to productive use in the economy? “It wouldn’t be something Democrats would enjoy voting on,” says a former Democratic staff director for a congressional committee. “They don’t want to actually vote against private accounts. Their goal is to kill the idea before it gets to that point.”

But the power of personal accounts is such that the idea refuses to die. A new OpinionDynamics poll found overwhelming support for the concept of “choice” in retirement options. Many Americans are aware that the 1983 payroll-tax increases intended to fix Social Security were spent on other programs and know the money won’t be there to pay all the benefits promised to them.

Last March, the man who crafted that 1983 solution, Federal Reserve Chairman Alan Greenspan, told a Senate committee that Congress’s spending of the surplus means “we need to ensure that measures taken now to finance future benefit commitments represent real additions to national saving. … We need, in effect, to make the phantom ‘lockboxes’ around the trust fund real.” He went on to say that private accounts would increase national savings and putting future Social Security surpluses in a “lockbox” could finally force Congress to get serious about restraining spending.

Rep. Paul Ryan of Wisconsin, who along with Senator John Sununu of New Hampshire wrote the plan that creates the largest personal accounts, agrees. He says the current system allows the government to mask the size of the current deficit by using Social Security surpluses. “Maybe the only way to achieve the spending restraint needed to create private accounts is to expose just how much spending has gone out of control,” he told me.

Robert Pozen, the investment banker and John Kerry supporter who developed the progressive indexing idea Mr. Bush has embraced, thinks it won’t happen. He told CNBC’s Larry Kudlow that he’s “all for” starting personal accounts now with current Social Security surpluses – “if you can do it.” But he believes politicians won’t be able to give up using surpluses to hide the size of the deficit. Unlike Mr. Greenspan, he believes convincing the White House and Congress to reduce spending is “just totally unrealistic.”

Indeed, some White House aides resist the idea of putting Social Security surpluses in personal lockboxes. Truth-in-budgeting would create the appearance of a ballooning deficit and expose the White House to charges its deficit reduction projections were hollow. Still, Steve Moore, head of the Free Enterprise Fund, says their attitude could change: “The time may come when the White House has to ask what it prefers: a non-real, apparent increase in the deficit or winning the creation of small private accounts that will become more politically popular over time.” The personal lockbox may prove a popular enough idea to break a Senate filibuster, and in any event the president could even try to create personal accounts from the surpluses for a single year by attaching the plan to a must-pass appropriations bill that would require only a majority vote to pass. He could then dare Democrats to kill the accounts once they have been created.

Rep. Bill Thomas, the hard-charging chairman of the House Ways and Means Committee, is also looking at ways to put the Social Security surpluses to work. Last week, he told CNBC’s Mr. Kudlow that the GAO was studying the issue. “What would be the difference if we could move [the surpluses] to marketable securities?” he asked. “It would create an instrument that we could transfer” to individuals. A source close to Mr. Thomas told me that the personal lockbox for Social Security surpluses “could be a political master stroke.” Adding the idea of allowing people to save for long-term health-care insurance would be a political and policy sweetener.

A lockbox filled with T-Bills also might be easier to explain than the president’s current plan. “We’ve learned from the last two months that many people view the idea of personal accounts as confusing, they don’t know they would be voluntary, they worry about diverting a portion of payroll taxes away from Social Security, and they think the accounts might be ‘risky,’ ” says Alex Pollock, a banker now working at the American Enterprise Institute.

Mr. Pollock says people could better understand having the Social Security surpluses go directly into private accounts. He would fill the accounts with a version of the popular Treasury Inflation Protected Securities, or TIPS. After a transition period, account holders could be given the freedom to trade their TIPS for other instruments such as annuities, private-sector bonds, or blue-chip stocks. He notes that such accounts wouldn’t require huge upfront borrowing by the federal government. “Alex’s plan is simple, understandable, and effective and could begin immediately,” says economist Alan Meltzer. “It would reveal opponents of reform as mostly concerned about having government keep control of the surpluses.”

Mr. Pollock’s idea has several precedents. The federal employee retirement program allows money to go into a fund that invests solely in Treasuries. The T-Bill Accounts would resemble another familiar long-term savings vehicle: the payroll deduction for U.S. savings bonds. Rep. Nancy Johnson of Connecticut, a leading GOP moderate, points out that in 1999 Bill Clinton advocated “investing Social Security surplus dollars into the private [stock] market.” How much safer would personal accounts limited to T-bills look? The AARP’s argument that people could lose their money in Las Vegas-style investments would go out the window.

In political terms, even more important than the safety and familiarity of T-bill private accounts would be the political dilemma the idea creates for opponents of reform. They have long railed against “raids” of the Social Security trust fund, most famously when Al Gore made the word “lockbox” a staple of late-night comedy in the 2000 presidential debates. But even before that, Harry Reid, now the Senate Minority Leader, inveighed against the depletion of the trust funds by calling it “embezzlement, thievery.” Former Senator Ernest Hollings of South Carolina lamented the “siphoning off of every dollar of the Social Security surplus to meet current operating expenses” and said “those IOUs in the trust fund vault are a 21st-century version of Confederate banknotes.” Forcing Democrats and Republicans alike to vote on a plan that actually ensures Social Security surpluses are used for retirement would be a defining moment in the debate.

Such a defining moment has happened before. In 1986, President Reagan’s proposed tax reform was on its deathbed in the Senate Finance Committee as lobbyists worked to revive loophole after loophole. Facing defeat, Chairman Bob Packwood retreated with his top aide to the Irish Times bar for a lunch of burgers and beer. There Mr. Packwood decided to launch what he called a “radical plan”: a top income tax rate of 25%, a full 10 points lower than any other proposal. The high-risk strategy worked, and Congress eventually passed a 28% top rate, striking a compromise that ruthlessly eliminated exemptions and raised corporate taxes. Richard Darman, then deputy Treasury secretary, hailed the Packwood move by saying it forced the hand of opponents and “re-created the sense of the possible in the American system. It is possible to be bold.” He said naysayers “were brought down by the narrowness of their vision.”

Today’s opponents of Social Security reform have the narrowest possible vision: no reform plan of their own and blind opposition to the idea of giving people ownership and control of any of the money they send the government for retirement. It’s time for President Bush, Senate Finance Chairman Chuck Grassley and Rep. Thomas to emulate 1980s tax reformers and force opponents to confront the concept of having risk-free private accounts that lay the groundwork for an ownership society. It may be an idea whose time has come – this year.

Mr. Fund is the author of “Stealing Elections: How Voter Fraud Threatens Our Democracy.” To subscribe to the “Political Diary” e-mail newsletter featuring Mr. Fund, please visit www.OpinionJournal.com, from which this column is excerpted. © Dow Jones & Company Inc.