I have generally disagreed with most Bush administration proposals, but I think his social security reforms seem sensible. I got this from whitehouse.gov
As we fix Social Security, we must make it a better deal for our younger workers by allowing them to put part of their payroll taxes in personal retirement accounts.
Personal accounts would be entirely voluntary.
The money would go into a conservative mix of bond and stock funds that would have the opportunity to earn a higher rate of return than anything the current system could provide.
A young person who earns an average of $35,000 a year over his or her career would have nearly a quarter million dollars saved in his or her own account upon retirement.
That savings would provide a nest egg to supplement that worker’s traditional Social Security check, or to pass on to his or her children.
Best of all, it would replace the empty promises of the current system with real assets of ownership.
I don't see why people are so resistant to that idea. My only concerns are that I would not want to lose all of the money I have paid out for social security already by starting a brand new account from scratch, and I would want this new account to be completely independent of my existing IRA. I would want to be able to fund both accounts. I am not an economics stud, but I don't see the downside. More people will be investing in the economy (which is good), retirement benefits will stay the same or even possibly increase (which is good), and taxes will not rise above current levels (which is also good). Where is the argument against that?
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6 comments:
In a word - Fear. Some people do not have the faith in Humanity that you and I have. They think that, given the option, people will somehow squander, loose or just screw up the monies in the personal account.
Tsykoduk,
I disagree. Over half of america has 401k's. The VRAs (voluntary retirement accounts) will be 401k's with less risk. The numbers and stats show that americans are responsible with investment vechicles such as 401k's.
The people who do not want VRAs, do not want them because of lack of faith, they do not want tem for other reasons.
I think the people are agaist VRA's for several reasons. The loss of personal dependance on the goverment , the loss of goverment power, the broad use of market principles instead of socialist principles, and the loss of a democratic created program.
think the people are agaist VRA's for several reasons. The loss of personal dependance on the goverment , the loss of goverment power, the broad use of market principles instead of socialist principles, and the loss of a democratic created program.
In a word, fear. :)
in mutilple words: lust for power and control. :)
Yup - and fear of loosing it. That's why they are fighting it so vehemently.
(why do I feel like I am in a last word contest? {Grin} )
I feel the same way when I discuss a point with Cube, even when it seems like we are both on the same side. I can see how people would be fearful of becoming RESPONSIBLE for their own retirement, but I think some PSAs and some goverment funded classes on retirement could go a long way to comfort those people.
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