You're probably well aware that the earlier you start investing, the more wealth you can accumulate over a lifetime.

But younger Americans aren't investing as much as they used to, and payroll taxes — for Social Security and Medicare — are a large part of the reason why, Stephen Moore, distinguished visiting fellow at The Heritage Foundation, writes in The Washington Times.

Only 7 percent of households headed by Americans under 35 directly own stock, according to the Federal Reserve. "That's pitiful" compared to the 30 percent level prevailing when the survey was first conducted in 1963, Moore says.

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"Perhaps the biggest problem for young workers is that the government intercepts more than 12 percent of their paychecks through the Federal Insurance Contributions Act (FICA) payroll tax."

And what's the big deal there? "After paying these taxes, many don't have much disposable income left to invest after paying for the necessities," Moore writes. "Worse, the young get no rate of return on that money because the government spends it when it gets it."

Elsewhere on the investment front, behavioral economists, who argue that investors are naturally irrational but can be cured of that irrationality, initially offered hope, but no more, says MarketWatch columnist Paul Farrell.

"At first [around 2002, when behavioral economics took hold,] we assumed humans can change — we can still educate ourselves to be more rational. We even assumed Wall Street’s behavioral economists would help us become less irrational," he writes.

"Fat chance. Since then, behavioral economists have been capitalizing on their newfound power to get personally richer: getting research grants, speaking fees, university professorships and, of course, consulting contracts with Wall Street banks, Corporate America and Washington politicians."

Farrell says the problems include:

• "Behavioral economics promises to make you less irrational. Wrong.
• "Wall Street’s behavioral programs manipulate investors acting irrationally.
• "Behavioral economists are political mercenaries, biased and partisan."

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