President Bush’s State of the Union address on February 2 forcefully staked his presidency on the issue of Social Security reform built around personal accounts for younger workers. It is clear that Bush intends this issue to be the centerpiece of his domestic agenda.

There is much to be said for the idea, which has been advocated by many conservatives for years. Such accounts would fulfill a key principle of making individuals more responsible for their own well-being and less dependent on a federal entitlement. They would allow younger workers to begin accumulating wealth more rapidly. They might strengthen the economy as well, since some of the money might be invested in economically productive enterprises. Some suggest that, if done well, personal accounts could also have the political effect of gaining votes for Republicans by expanding the size of the small-investor class.

Indeed, if one were designing a federal retirement program from scratch, this is almost certainly the way one would want to do it. It is more consistent with individual liberty and individual responsibility, with limited government and a strong private sector, than Social Security as it was actually designed and has evolved. It is a post-collectivist program for a post-collectivist age.

Not least, many conservatives will not fail to notice that a defeat of the President’s plan could bring a sharp halt to the momentum that he so dearly won on November 2, thus endangering the rest of his extensive domestic agenda.

Despite all of these facts, however, there are a number of reasons that conservatives should think very carefully before jumping on the Bush Social Security bandwagon.

The transition cost alone should be enough to inspire caution. Estimated by the administration itself at $754 billion over the next decade, and trillions more beyond that, the program figures to either balloon the debt or put substantial upward pressure on taxes. Young workers may find that the gains from private accounts will be offset by higher income taxes, higher inflation, or both.

This point is all the more salient since administration officials themselves have recently acknowledged that the President’s plan would not actually improve Social Security’s solvency. It is also given greater weight by the administration’s own lack of fiscal discipline to this point, which has given little reason for confidence that it will try to make up some of the cost with lower domestic spending elsewhere.

Social Security is, as Bush argues, a ticking time bomb. Since we cannot go back to 1935 and rewrite the Social Security Act, the greatest aim of those concerned with limited government in America must be to guarantee the program’s solvency far enough in advance of its real moment of crisis to allow for a gradual and politically safe adjustment without a tax increase. Conversely, the greatest aim of social democrats will be to forestall reforms that limit the program, let the clock run out, and force the nation to wake up to the impending insolvency of the program—at which moment a massive tax increase will become unstoppable. This has already happened in 1977 and again in 1983, but the next time it happens the tax increase will dwarf previous hikes. Enormous damage will be done to the economy and to individual liberty, and America will find itself that much closer to a Scandinavian-style public sector.

The problem with the Bush plan is that it would seemingly do little or nothing to forestall that catastrophe. Even if, in the very long run, it might contribute to averting the disaster—and again, administration officials do not claim that it will—the risk in proposing it is that it might prove too controversial to be enacted and, while going down, it may take with it any chance of entitlement reform from the right in the foreseeable future.

Those in favor of a fix for Social Security that respects principles of limited government and low taxation—those who hope to block the ultimate Swedenization of America—might get only one chance. They need to think carefully—perhaps more carefully than they have thought thus far—about whether they want that chance to ride on an approach that seems to carry more policy and political risks than payoffs. Devotion to free market principles is not the only feature of a worthy conservatism. A preference for avoiding unnecessary and potentially dangerous risks, and a recognition that reforms often go badly awry despite the best intentions of their authors, are also honorable features of conservatism.

None of this means that we would be better off without Bush’s advance on the issue. To the contrary, the President should be commended for opening up this discussion now, when there is time to face the problem in a rational and measured way. He should likewise be commended for his willingness to risk his political capital on an issue that most politicians have long avoided. His opening plan is right in principle, and is radical enough that some ground can be given over the next months while preserving the possibility of a meaningful and beneficial outcome—as long as congressional Republicans do not simply stampede from the field in panic first. Bush has laid out a marker, and a key question will be whether he is willing to make a good deal short of what he is asking for today.

What might that deal look like? Phased-in changes on the spending side, possibly including a higher retirement age and a cost-of-living adjustment based on price inflation rather than wage inflation, that will put Social Security’s projections back on track without a payroll tax increase. No personal accounts drawn from payroll taxes, but enhanced incentives for savings in the income tax code. This combination could achieve the objectives of reducing Americans’ dependence on federal largesse, increasing private investment, and restoring the solvency of the program through spending restraint, with a much lower probability of unpleasant fiscal surprises or political backlash. Throw in genuine reform of Medicare—which will be in dire straits five years from now rather than 35—and Bush might have a legacy better than personal accounts. He might end up being the president who saved limited government in America.