Last week, President Bush for the first time put meat on the bones of his proposal to modernize Social Security and save it from financial collapse. The president’s plan would be a financial savior for young workers, while safeguarding the benefits for the old. It would allow Americans to take one-third of their payroll tax for Social Security (or about 4% of every paycheck) and divert those funds into a personal IRA-type account that they themselves would own and control. As Mr. Bush has put it: “This is money that the government could never take away from you.”

By tapping into the power of compound interest, the average American under the age of 30 would be able to accumulate more than $500,000 in these accounts by the time he or she reached retirement age.

The challenge for the White House has always been to find a way to win over Democratic votes. In order to lure Democrats into this debate, the president suggested a change in the benefit structure that would cut back on future promised benefits for higher-income and some middle-income workers. This plan would reduce the multitrillion-dollar unfunded liability of Social Security by about half, and thus help finance the personal-account program.

Even with this tweaking of the way benefits are calculated, real pension payments to retirees would rise steadily over the next 75 years.

Still, the Democrats remain planted in complete opposition to reform. It is almost as if the Senate Democrats – and some feckless Republicans too – have a hyperallergic reaction to the notion of allowing workers to build up private wealth and personal ownership.

The greatest beneficiaries of personal accounts for Social Security are lower- and middle-income workers. That was the point that the late Senator Daniel Patrick Moynihan made repeatedly about the advantages of personal accounts. He insisted that personal accounts allow the doorman of the apartment complex to build up private wealth and get rich, not just the family living in the penthouse suite.

Study after study has demonstrated that black and Latino workers, because they start working at earlier ages and because they have lower life expectancies than whites, get the worst rate of return from Social Security. For black males, whose life expectancy is actually slightly below the Social Security normal retirement age, the rate of return on Social Security is negative. Where is the justice and fairness in that?

The main attack against personal accounts is that they are “too risky.” But Mr. Bush pointed out correctly that even if workers invested zero-risk Treasury bills in their personal accounts, they come out ahead. That’s because Treasury bills pay 3% to 3.5% interest each year, whereas Social Security pays 1% to 2%. For most workers, FDR’s New Deal, has become a raw deal.

Most important, Mr. Bush’s plan for personal accounts is optional for every worker. For those who believe that personal accounts are “too risky,” they are invited to stay under conventional Social Security. Mr. Bush simply gives all Americans the right to decide for themselves. The left still says no. So much for the Democrats being the “pro choice” party.

Given this Berlin Wall of opposition by the Democrats to any Social Security plan that smacks of private ownership, it appears that the chances for Bush to succeed this year are slim. But conservatives should not despair. This fight has only further reinforced the notion that Republicans are the reform party in America and that today’s Washington Democrats are reactionary obstructionists who are completely devoid of any ideas of their own.

The only “solution” that Democrats have offered to deal with the multitrillion-dollar Social Security crisis is to raise tax rates on the rich. Raise payroll taxes, income taxes, estate taxes, and dividend taxes. And by the way, if you earn more than $90,000 a year, congratulations: The Democrats think you’re rich.

Mr. Bush deserves praise for being the first president in modern history to have the political courage to try to avert a tsunami of red ink in Social Security over the next 50 years. That is what the voters will ultimately remember about this political tug of war.

The president and reform-minded Republicans may not win this first battle, but they are winning the war. Stay the course.

Mr. Moore is president of the Free Enterprise Fund and a senior fellow at the Cato Institute.