The latest in gimmicky government policies, the much-touted but meaningless "lock box" has taken the US by storm. The president, prominent Republican members of Congress and the main presidential contenders have advanced a flood of lock-box proposals, which aim to "save" Social Security and Medicare by protecting -- or locking away -- their revenues from the rest of the government.

On the surface, these policies sound excellent. But the proposals do nothing to strengthen either programme. In fact, they create an atmosphere of complacency just as critical choices to avert financial crises in Social Security and Medicare need to be made.

The appeal of lock-box policies can be traced to accusations that politicians are raiding Social Security and Medicare's trust funds. Not relishing their depiction as thieves targeting senior citizens' savings, politicians have been scrambling to find a way to prove they are defenders, not pilferers, of the programmes. But they face a dilemma: the reforms that would actually strengthen the finances of Social Security and Medicare -- increasing revenues to the programmes or cutting benefits -- are highly unpopular with voters. Any mention of these options tends to be met with harsh accusations as well as voter retaliation. Notice how Al Gore and George W. Bush, the leading presidential candidates, are competing over their plans to save Social Security without mention of how to pay for them.

The solution to this political predicament seems to be the lock box, a manoeuvre that allows politicians the appearance of taking a bold stand to protect Social Security and Medicare without addressing the politically dangerous choices that are actually needed to keep them solvent.

When Social Security or Medicare Hospital Insurance -- the part of Medicare financed by the payroll tax -- run a surplus, as they will this year, their excess dollars flow through their trust funds and are replaced with special, non-marketable interest-earning Treasuries purchased from the government. The government then uses the dollars to pay for other programmes or, when it is running a surplus as now, to buy back Treasuries from the public to pay down the debt.

Under lock-box proposals, little would change. The government would be required to run a surplus not including those in Social Security and Medicare, in effect sealing off the programmes' surpluses from being used for anything other than debt reduction. While rich in rhetoric, this modification does nothing to strengthen Social Security or Medicare: the trust fund receives the identical amount in Treasuries and interest whether its surpluses are spent on other programmes, tax cuts, debt reduction or anything else. So on paper -- and that is all the trust funds are -- its financial soundness remains unchanged.

Furthermore, the timing of the plan raises suspicion. Broad support for lock-boxes popped up only once it was clear the US was entering a period of unprecedented surpluses. Nothing needed to change for lock-box policies of running surpluses to be adhered to. But what happens if the surpluses were suddenly to dry up -- as they could with even slightly lower levels of economic growth? The government would be forced to maintain surpluses by increasing taxes or reducing spending. This is precisely the opposite of what is needed when the economy slows. The lock boxes would be cast aside the moment they involved anything other than the status quo.

The problems in Social Security and Medicare have to be addressed and lock-boxes will not do the trick. There are many good innovative reforms available including using private accounts to increase the returns in Social Security and increasing competition in the provision of healthcare for senior citizens. But there is no magic bullet, and many difficult questions will have to be answered. Either the transition to private accounts or keeping Social Security solvent in its present form will demand additional resources or benefit reductions.

The questions relating to Medicare are even more profound. With remarkable progress in medical innovation and the introduction of many new life-extending techniques, what and how much should be covered by Medicare? Any expansion of benefits, no matter how it is provided, will bring associated costs, pitting beneficiaries against workers who foot the bill.

The many specific issues plaguing Social Security and Medicare can be boiled down to three questions: should revenues be increased, should benefits be cut or the retirement age increased, and to what extent can services be provided more efficiently?

Regardless of the answers, every change becomes more expensive the longer we wait. And lock-box policies, which contribute to their delay, will only make things worse.