Belated link to a good post by Richard giving various perspectives on ID Theft. Richard is (among other things) the author of a blog called POSIWID - a superb acronym which stands for "Purpose Of System Is What It Does".
Fittingly, one of the topics he mentions is the use of Social Security Numbers as an index to national identity schemes - something which is apparently being considered in the UK. As he points out - SSNs are not secret values. In fact, they are not even credentials; they are at best an unsecured attribute which is, essentially, in the public domain. The problem is that, as usage in the US amply illustrates, service providers become accustomed, over time, to treating this non-secret value as a reliable substitute for credentials. Hence POSIWID... the Purpose of the System becomes What It Does, which may well not be What Was Originally Intended.
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