Social security should be privatized.

I'm glad we at least agree that social security has serious issues. It's always good to have common ground upon which to debate. I disagree that privatization has a shaky track record. It is government programs such as social security that have a shaky track record. Our entire economy is based on the merits of private enterprise, and it has worked for us thus far. Despite the relative youth of this country, we have managed to surpass all other nations in terms of economic productivity and wide-spread prosperity. I think it is rather inconsistent to say that, whereas privatization has proven successful in virtually every other area of our economy, that it would not be successful in providing retirement benefits for seniors. "[In] Chile, 41% of the accounts created have funds so small that the retirees are forced to continue work." I have no doubt that this is the case. However, I don't see that our system is much better. According to one website (which I have cited below due to the length of the URL) one third of U.S. retirees are forced to go back to work shortly after "retiring," despite the 500 billion dollars collected in payrol taxes every year. At least Chile is getting its money's worth. "Relying on individual savings rates pushes us into a further risk bracket that many will make poor choices and then wind up being on the welfare dole. That's hardly a solution." I don't see how savings rates puts us into a higher risk bracket. Savings accounts are the second lowest risk investment type, preceeded only by cash itself. There would be virtually no risk involved. The cost of privatization is irrelevant. That cost will only grow the longer we wait to fix this problem. Our choice is not between privatization and non-privatization, it is between privatization now, which MAY cost 4.9 trillion (depending on how you go about it), or privatization later, after the system has collapsed and elderly people are left without an income. You wouldn't be replacing one bloated bureaucracy with another, you'd be eliminating a bloated bureaucracy and replacing it with a private system whose very survival depends on its ability to be efficient! It doesn't cost any more for a mutual fund manager to handle two billion dollars than it does to manage two million dollars. The additional administrative costs would arise with distribution of benefits. Since businesses, unlike the government, are trying to make money, they are forced to do things in the most efficient way possible. Because of this, the cost of distribution would be significantly less than under a government run system. Moreover, we would be introducing a powerful factor into retirement benefits: compound interest. If we were allowed to invest our own money for our own retirment, instead of pay for someone else's retirement by sending that money to the government, more people would retire in a much better financial situation than currently. If I were allowed to put 2,000 dollars per year into decent mutual fund (one that earns 10% interest after adjusting for administrative costs and inflation, which is not unrealistic) beginning at age 24 until I retire at sixty-five, I would end up with one million dollars, only $80,000 of which I had actually put in to the account! That constitutes a %1250 return on my investment. Contrast that with our current system in which you recieve an estimated 1.23% rate of return for two income households. If social security is nothing more than the crappy end of a larger investment portfolio, why have it at all? Yes, there would still be administrative costs for a private system, but at least we'd be getting something in return. Why send $200 dollars to the government every paycheck where it will acrue no interest when you could invest it and get at as much as 10% interest? In light of this, social security is indeed a joke. Or at least it would be if it wasn't so completely wasteful. http://64.233.169.104/search?q=cache:HGSGDdY0zq0J:www.ci.walla-walla.wa.us/vertical/Sites/%257B5C31B82F-5E63-4200-9CF4-237E5245E279%257D/uploads/%257B528FE4F0-356F-4DB6-A60E-6258691ACD6B%257D.DOC http://www.heritage.org...