Last time, visiting Congressman John Spratt, D-S.C., ranking minority member of the House Budget Committee, was explaining the Democratic objections to president Bush’s proposal to “allow” workers to shift about one third of their Social Security levies into (government supervised) private retirement accounts.

But so far in our discussion, no one seems to be talking about a major evil of the status quo, that being the way the overheated government printing presses -- struggling to keep congressional promises not just on retirement benefits but on those really massive budget-busters, Medicaid and Medicare -- have perversely damaged those who do try to provide for their own retirements.

“Security for whom? For the aged?” asked conservative columnist John T. Flynn in his 1948 book, “The Roosevelt Myth.”

“What of the millions of people who through long years of thrift and saving have been providing their own security? What of the millions who have been scratching for years to pay for their life insurance and annuities, putting money in savings banks, commercial banks, buying government and corporation bonds to protect themselves in their old age?” Mr. Flynn asked, nearly 60 years ago. “These thrifty people have seen one-half their retirement funds wiped out by the Roosevelt inflation that has cut the purchasing power of the dollar in two.”

Yes, Roosevelt and the “New Dealers” pretty much invented inflation as we know it today. And where Mr. Flynn could refer to the value of the dollar being cut “in half” from 1933 to 1948, we can now substitute “to a twentieth.” In 1931, a twenty dollar bill would buy you an ounce of gold. Under Roosevelt, about half an ounce. Today? With the American dollar well on its way to becoming a world laughing stock on the order of those wheelbarrows full of Weimar reichsmarks, make that a mere twentieth of an ounce of gold.

When Roosevelt installed his first old-age pension plan, it promised Americans eight dollars a week. In 1934, an American could live on eight dollars a week. How would you be faring today if that’s what granddad had set aside for your retirement? People wonder why Americans’ saving rate is now so low. Why save, if what you save will be essentially worthless to your grandkids?

Meantime, what alternative plan would the Democrats offer?

Rep. Spratt told me if he had his druthers, the money managers at the Social Security Administration would invest the “Trust Fund” directly into private stocks and bonds, “to increase the rate of return.”

But in a practical sense, I objected during our conversation last week, the federal government can’t hold “minority interest” in a corporation, any more than the Mafia can. Once they’ve “invested” in you, you can’t be allowed to fail, which means the federal bureaucrats would, de facto, manage all those companies whose stocks they had purchased.

“Wouldn’t that be fascism?” I asked the 22-year veteran congressman.

“No; it might be socialism,” he replied, cheerfully.

I doubt Rep. Spratt actually knows the economic definition of the word fascism -- the juncture of syndicalism and nationalism popularized by Mussolini after 1925 (and borrowed by Roosevelt for his “National Recovery Act” in 1933), allowing private (though “cartelized”) corporate ownership of the means of production but under close government supervision and “partnership” -- but that’s exactly where his proposed “solution” would lead.

“It would be very dangerous to have the government invest the Trust Fund in the stock market and have the government manage it,” agrees assistant secretary Mark Warshawski at Treasury. “Alan Greenspan spoke out very strongly against it. A lot of people thought that ended that idea.”

To slow the bankruptcy of the various federal “entitlement” schemes, Rep. Spratt would also like to see the federal government, as the biggest buyer, “negotiate” drug prices with manufacturers so the Congress can afford to continue promising “cheap” prescription drugs to just about everyone.

“But what does ‘negotiation’ mean when one party at the table actually makes the laws?” I asked. “Doesn’t that amount to the federal government just dictating the prices?”

I expected Rep. Spratt to heatedly deny this. Instead, astonishingly, he agreed.

“We can establish a fair price,” he replied. “We know what the price is in France; we know what it is in Canada.”

This is precisely how the Soviets used to figure out how things should be priced, of course -- what multiple of the price of a head of cabbage to assign to a pair of shoes or a hammer or a tractor. They just checked the newspapers from Paris and London.

So -- once doctors are required to offer “health care” at rates set by the government -- what salaries shall they be assigned? Will surgeons be G-12s or G-14s?

Next week, in our final installment: Is Social Security really “mandatory”?