Choice quotes from an article in defense of privatizing Social Security:
Bush's plan basically allowed for younger workers to create private Social Security accounts, which they could then invest in a mix of balanced stocks, bonds, commodities, and other financial holdings similar to the way most people invest their 401(k) plans today. It was only part of their Social Security tax, but it was at least a start.I'm contributing a portion of my paycheck to Social Security each week. However, I do not expect I will be receiving Social Security benefits when I retire in 40-odd years. I feel no moral responsibility to pay for the elderly, nor should I. Your grandmother is not my responsibility. Nor do I expect your children to pay for my retirement. Social Security needs a radical reworking.More importantly, the plan would have taken a step toward giving Americans ownership over the money they "contribute" (the government's term, not mine) to Social Security. Within a generation, what you and your employer contribute would no longer go into a general fund that can be raided at the will of Congress, but to a personal account with your name on it. Not only could you then invest that money to yield a (much) higher return than what you'd get from the government, but should you die early, the money you've been contributing for all your adult life would be passed on to your heirs. Today, it goes back to the government.
Had the Bush plan been successful, millions of poor people would have begun to accumulate inter-generational savings that could help their children or grandchildren escape the cycle of poverty. Our Social Security system would not only be sound, it would be more honest. Your contribution to your retirement would be exactly that, as opposed to what it is today, which is a tax on youth used to prop up a Ponzi scheme to provide benefits for the elderly...
There's no period in the history of the stock market—including the crash of 1929, the stagflation of the 1970s, the crash of 1989, and the tech bubble burst of the early 2000s—in which a worker who'd been investing for 30 years or more wouldn't have still received a far better return than what he got from Social Security, even if he retired the day after a historic Wall Street dive...
Social Security faces an unfunded liability of $4 trillion over the next 75 years. USA Today reported in May that the combined federal liability for Social Security, Medicare, and other government programs for everyone currently eligible is more than $57 trillion, or $500,000 for every household in the country. And, of course, Congress can raid the Social Security "trust fund" at will.
The stock market is risky? The federal government currently has obligations it will never be able to keep. And none of this accounts for trillion-dollar bank bailouts, inevitable wars, or the new entitlements promised by the current candidates for present and future occupants of the White House.
-- interlude while I discuss this with my father for 45 minutes ---
And privatizing Social Security is the answer.
Other note: The baby boomers' parents broke the social contract upon which Social Security was founded. Ending Social Security outright would no more be a breaking of that contract than the collective decision those people made 55 years ago.
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