Should Social Security be privatized?

[311]

The government borrows money from the Social Security fund and pays back the loans with t-bills. The t-bills aren't worth anything except the promise that the money will be repaid at some point in the future. When analysts assure us that Social Security is sound, they're assuming that the government will be able to honor these treasury bills. Of course, if the government doesn't cut spending significantly or raise taxes significantly, one has to wonder where it'll find that extra revenue. Lying under a rock, I suppose. Not only that, but the number of people collecting Social Security will soon exceed the number of people paying into the fund. There are different estimates regarding when the fund will run dry, but I tend to agree with the Cato Institute's numbers. Whenever it is, it's soon.

The only conceivable way to "save" Social Security without privatizing 1) raise the age, 2) raise the withholding tax, 3) increase the penalties on early payments, and 4) perhaps make Social Security needs-based rather than an entitlement program.

Of course, this begs the question - if we have to do all this to save a 70-year-old program, then maybe it isn't worth saving. Maybe it's outdated and defunct.

Partial or total privatization just makes sense. Social Security revenue just sits there vulnerably while Congress borrows and never pays back the money. If some of the funds were invested into low-interest accounts or investments, it'd help the economy and Social Security. These investments aren't "risky," and the current state of the DOW shouldn't be used as an argument against this. In fact, people who are using this argument don't understand how economics works at all.

It's fine and dandy if you don't want to privatize even a small portion, but to deny people the OPTION and to not have a plan to save Social Security are unacceptable. If you want to keep an old program that isn't working, then at least come up with a solution that doesn't compromise the quality of Social Security.