Pros And Cons Of Privatization Of Social Security

Our nation ensures social welfare through Social Security. However, the United States cannot ensure the welfare of its own welfare system. To save Social Security, Americans in general do not favor an increase in the payroll tax, a cut in benefits or an increase in the retirement age. Furthermore, Americans are relying upon Social Security as their sole source of income at increasingly alarming rates. Social Security is intended to supplement retiree income, not account for 100% of it. Through elimination of the potential options, that leaves one necessary action: invest the Social Security trust fund in the stock market.

In “The Social Security Problem”, Max Moore discusses the fearful reality of Social Security running out of funds. He states that the U.S. Department of the Treasury predicts that Social Security funds will run out by 2041 and action must be taken in order to prevent this (134). In his essay, he explains how the depletion of Social Security funds are a result from a decreasing retirement age, decreasing fertility rate, and shrinking work force. These things contribute to an increased population relying on Social Security, an increased population of the elderly, and a decreased ratio of workers paying for those beneficiaries (135). Moore explains the proposal of George W. Bush to make Social Security partially privatized; allowing young workers to invest their retirement savings into their own account. This would result in people putting their retirement on the line in

Being a high school student myself I do not have the fullest understanding of taxes or many government administrations at all but what I can say is I have a negative connotation to the Social Security Administration through my small amount of exposure to it through the media. When I researched it I was surprised by what I found. Despite my preset dispositions, the Social Security Administration seemed actually very helpful and I did not see where any hate could come from. Perhaps more interestingly I had read that it has been largely unchanged since it was first introduced in the 1930’s. The Social Security Act which created the Social Security Administration has positively affected our country.

One of the reforms created through the New Deal that still exists today is Social Security. Social Security was established through the Social Security Act of 1935 by Franklin D. Roosevelt. It established a national pension fund, a public assistance program for dependent mothers and disabled people, an unemployment insurance system, as well as benefits for victims of industrial accidents (Social Security Act of 1935). Social Security is very beneficial regarding its ability to help those who need it, but it is also the largest federal program today, resulting in huge expenses. CNS News published an article regarding the spending of the Social Security Administration, and stated in the article is, “The Social Security Administration spent a total

Standardized savings is a standout amongst the best government programs in the United States. This kept away from destitution after a huge number of Americans wound up plainly old, debilitated, and family wage laborers kicked the bucket. As President Bush underscores, " Social Security is one of the greatest achievements of the American government, and one of the deepest commitments to the American people." But in spite of its achievements, the program has two There is a major issue.

Those who think that privatizing social security will benefit the citizens who receive it are very wrong. The reason that they think that it will affect social security is because by creating private accounts, it will cause the separate interest rates for the individual person to go up or down depending on the person. This of course is unnecessary because the way it is set up right now, the individuals are receiving benefits that work for the certain situation that the person is in. Many retired citizens are not in financial crisis because of this setup, because there is nothing that is wrong with it. In the last couple of decades social security has completely transformed the way that elderly citizens in our country live their lives. According to Mortimer Zuckerman “roughly two thirds of people over 65 and older depend on social security for at least half their income, and roughly 20 percent rely on it for all their income.” These are pretty promising numbers regarding the way that the American seniors are spending their

Debates over Social Security have been ongoing since its inception in 1935 until today. The trend seems to be toward an increasing percentage of the American public, across party and demographic lines, in favor of strengthening Social Security funding, and a willingness to pay more to preserve and even improve benefits. However, the trend towards privatization of Social Security is also on the rise. What is not clear is whether Americans favor privatization because of fears that the Social Security Trust Fund is living on borrowed time.

It’s a matter of either losing all that you have worked for and live in poverty when retired or allowing your hard earned dollars to grow and have a secure comfortable retirement. I believe that Social Security is a doomed Government Program and that Privatization of Social Security would allow for a more secure retirement plan for all Americans. Social Security was first created to help aging Americans in their senior years so they would not end up in poverty. Social Security was signed in as law on August 14, 1935 by President Franklin D. Roosevelt and was fully operating by 1940 (SSA). Originally a retirement program, but Social Security now includes survivor benefits, disability benefits and Medicare and all together is the largest

Privatization of the United States Social Security system could actual be more efficient than the publicly operated system. Chile switched its public retirement system to a privately ran system to a less expensive system that has been fairly successful (Bosworth). Social Security privatization is overall a better option because it will increase the rate of the returns of its recipients. American 401K invested in US treasury bonds received between a 1.9% to 4.2% rates of returns while the average person born in 2004 will receive a rate of return of 1.7% (Bosworth). These bond options are as stable as a regular Social Security option is because both are provided by the government but a privatized account allows workers to pick higher yielding accounts. Privatized accounts allow for workers to also invest in the stock market at a higher risk reward basis. Survivor benefits from the death of a family member who paid into Social Security received from 75% to 71.5% for at least 10 years (Survivors Planner). This is the main flaw of the current Social Security system is that the result of an early death, the worker's family is at a significant disadvantage economically as well as emotionally. This lead to the main argument brought up by Barry Bosworth chair of international economics and Gary Burtless chair of senior fellow economics that the privatization of Social Security

Historically, Social Security has been able to run a surplus; more funds were brought in via FICA taxes than was paid out as benefits [6]. However, since 2010, the program has been instead running a deficit ranging between $45 and $73 million between 2010 and 2014 [6,7]. So far this has been okay; in the years when Social Security ran a surplus, the excess money was saved into the Social Security Trust Funds: the overhead term for the OASI and DI Trust Funds, financial accounts managed by the Department of Treasury. The trust funds

It’s a matter of either losing all that you have worked for and live in poverty when retired or allowing your hard earned dollars to grow and have a secure comfortable retirement. I believe that Social Security is a doomed Government Program and that Privatization of Social Security would allow for a more secure retirement plan for all Americans. Social Security was first created to help aging Americans in their senior years so they would not end up in poverty. Social Security was signed in as law on August 14, 1935 by President Franklin D. Roosevelt and was fully operating by 1940. Originally a retirement program, but Social Security now includes survivor benefits, disability benefits and Medicare and all together is the largest

Each day that goes by there is a politician or journalist arguing about social security, the plans for saving it, and the repercussions of said plans. These topics are constantly flowing through newspapers, internet sites, online journals, and economic journals as well as many other forms of media. The major topic of discussion is the plan put forth by the current administration to reform social security, or more specifically, privatize it. There is no correct argument or correct opinion on how the situation with social security should be handled. Unfortunately, the government has the power in their hands to do with it as they see fit. Presented in

The libertarian leaning Cato institute has come up with a solution to reform Social Security. The so called 6.2% solution would let workers divert half of their Social Security payroll taxes to individually owned, private investment accounts. The remaining half of payroll taxes would fund transition costs as well as survivors’ and disability benefits. Currently, the Social Security payroll tax rate is 12.4% with half coming from employees and the other half from employers. Those who opt into the private investment accounts will forgo traditional Social Security benefits. Additionally, workers could trade recognition bonds on secondary markets that would have a value corresponding to how much money an individual has already contributed to the Social Security program. However, the plan does allow individual workers to stay with the traditional Social Security model if they choose.

Stephen H. Gorin, in the article titled The Truth about Social Security and Medicare (2012), brings issues regarding social security to the surface while emphasizing the issues that reside in this matter. With the current acts of spending, reexamining the framework of the social security system may be for the best. “Social Security Trust Funds will be solvent through 2038; after this, the program will still be able to meet between 77 percent and 81 percent of its obligations” (Gorin, 2012). With this quote from the article, one can easily get a grasp of what issues will soon be arising within the social security system. Misuse of these assets has led citizens to wonder why the fate of their assets remains a mystery. This is lamentable in view of the way that these funds are consequently deducted from

     Privatization is the most controversial argument in this sector of government. Many citizens believe that they should be allowed to make investments on their own rather than having the government perform this for them. These people believe that by doing so they have more control over their future and more autonomy from the government. Furthermore, they stress that privatization will increase competition, which is the basis of our free market capitalistic society. Many other communities in accord, feel that by investing privately what they are now paying in Social Security would raise economic growth and increase retirement incomes. For the past several decades, the average yield on private stock has excited inflation by seven percent compared to treasury bonds that only exceeds inflation by 2.3 percent. Alternatively, all plans to privatize social security come with an adverse effect. Most noticeably, is the tax increases which are necessary to make