Though the alliance is strictly focused on Washington-based lobbying, its member organizations intend to unleash a nationwide educational effort on Social Security privatization, targeting shop-floor employees and staff with slick materials touting the benefits. Fifty thousand copies of an impressive four-color brochure have already been produced by the National Association of Manufacturers and Ernst & Young, complete with alarmist rhetoric ("The Social Security system is bankrupt") and praising the "personal retirement account" as the solution.

Economic Security 2000, a little-known member of the alliance, is also stepping up its grassroots work. Begun on a shoestring in 1995 and jump-started by, among others, a $50,000 contribution from Richard Fisher, former CEO of Morgan Stanley, the organization now boasts a $1.7 million annual budget, a staff of twenty-six, active volunteers in eighty-eight cities and a dozen regional field coordinators, says executive director Hillary Beard. Backed by money from foundations and corporations like DuPont, Boeing and USX, ES2000 is organizing in the trenches on a state-by-state basis, building support for PSAs. Yet, says Beard, Wall Street has judiciously chosen not to support her organization. "We don't have any Wall Street support, and it's not for lack of trying," she says. This spring, she says, ES2000 and Third Millennium, a conservative, self-styled Generation-X think tank, will convene a Washington, DC, forum financed by the J.M. Kaplan Fund to analyze exactly why Wall Street's money men aren't pouring money into organizations like theirs.

But at least some mutual fund money is finding its way to ES2000 and Third Millennium. In late January the two organizations are sponsoring something called the "Billion Byte March," an odd nineties-style event that involves the coordinated delivery of pro-privatization e-mail messages to Congress, sorted by Congressional district from the Web site www.march.org. The event is partially co-chaired (and promoted) by the 100% No Load Mutual Fund Council, an organization representing thirty smaller mutual fund families.

Meanwhile, there is at least some jockeying behind the scenes to make sure that if any privatization reform does indeed take place, no one's ox will be gored. In some circles there is consternation, for instance, that if a partially privatized system allows workers to set aside an additional 2 or 3 percent of their earnings--above the current 12.4 percent--it could steal billions of dollars' worth of business away from companies that currently manage 401(k)-type pension plans. And there is also concern that the system might be designed to favor, for instance, stocks over bonds, or large mutual fund companies over small ones.

A spokesman for the Bond Market Association says a privatized system must not be allowed to funnel workers' retirement money solely into stocks. "So," he says, "we're trying to insure that if Congress or the Administration does opt for privatization, that it include both stocks and bonds." Similarly, the 100% No Load Mutual Fund Council wants to make sure that whatever happens, the smaller funds aren't excluded. Since many of the new accounts would be small (as little as $100-$200 a year), no-load funds, which cost less for investors, would be perfect, says the council's executive director, Tad Douglas. "Anyway," he says, "the large mutual fund companies aren't interested in small investors like these."

In the end, if anything does happen, it will be a compromise between what the privatizers want and Bill Clinton's carefully crafted plan. Such a compromise could prove difficult or impossible to achieve. Virtually all of the Republican Party is lined up behind partial privatization--indeed, a central part of the GOP's response to the State of the Union was the need for private accounts carved out of Social Security. And a number of moderate Democrats are on board. Yet that's not enough: Social Security cannot be reorganized without strong bipartisan support. Moreover, if partial privatization is to happen, Clinton will have to make an irreparable break with the AFL-CIO, since labor will never surrender on any carve-out of Social Security money. Right now, says an insider, many of Clinton's key economic advisers are leaning toward support for partial privatization, but the White House's political gurus, including those advising Vice President Gore, are skeptical. "And," he says, "as of today the political people are in control."

That was evident in the State of the Union address, in which Clinton mostly hewed to Social Security orthodoxy while trying to co-opt the GOP by backing some market investments and a system of private accounts added onto, not carved out of, Social Security. In so doing, he has tossed the ball to the Republicans, for whom it is a tricky play--one misstep and the Democrats have a slam-dunk issue for 2000. The Republicans could take Clinton's refusal to explicitly condemn privatization as a signal to push ahead--and then find themselves accused of trying to dismantle Social Security. Yet while ruling out "radical" privatization but refusing to be more specific, aides like Gene Sperling and Social Security Commissioner Ken Apfel do seem to be leaving the door ajar.

Of course, it's always a safe bet that Congress will end up doing nothing, since, crisis or no, the problem can wait. But the privatizers see 1999 as their golden moment.

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