What Is Social Security Privatization
LeeAnn Green
Professor Goldberg
Writ 102
6 November 2013
Salvaging Social Security
Since passed by Congress in 1935, Social Security has been considered by Americans to be one of the most beneficial and supported government programs, providing benefits to society and the elderly. Despite its widespread popularity, the program faces major funding issues, making the future of Social Security seem unpromising. In the 2013 annual report by the Social Security and Medicare Board of Trustees, the Social Security program is estimated to be drained by 2033, after which it would be able to fund only seventy-five percent of promised benefits (“Social Security, Present and Future”). This projected downfall of Social Security has many people wondering …show more content…
The privatization of Social Security basically means that each account would be individually owned and operated (Anders and Hulse). Presently, the funds received from each individual’s payroll tax are invested in the Social Security trust fund, which is controlled by the government (Koleva). As said by writer Yoana Koleva, “these accounts actually do not belong to the employees and are more of a tracking mechanism that provides information to determine the benefit amount received once the employee reaches normal retirement age” (Koleva). Therefore, privatization proposes that the accounts are privately owned and controlled, as opposed to the current system in which each individual’s Social Security account is controlled by the …show more content…
Some of the major problems with Social Security include: the declining ratio of workers to retirees, the decreasing personal saving rate, and the poor income redistribution done by the program. These rising issues cause many people to wonder if Social Security will be around in the future for their retirement. The answer is no, it will not last without reform. Deciding on which reform is another issue for the government, because each proposed reform has both positive and negative effects. There is not a single reform that will solve all of Social Security’s problems. No version of reform will positively impact effected all parties. Therefore, both retirees and workers need to accept that they will have to make sacrifices, whether it is reduced benefits, or increased payroll taxes, because without these changes Social Security will not last. The only way to salvage the program is to combine benefit reducing and revenue increasing reforms, and to find permanent solutions to the funding issues so that reforms will not be needed in the
Professor Goldberg
Writ 102
6 November 2013
Salvaging Social Security
Since passed by Congress in 1935, Social Security has been considered by Americans to be one of the most beneficial and supported government programs, providing benefits to society and the elderly. Despite its widespread popularity, the program faces major funding issues, making the future of Social Security seem unpromising. In the 2013 annual report by the Social Security and Medicare Board of Trustees, the Social Security program is estimated to be drained by 2033, after which it would be able to fund only seventy-five percent of promised benefits (“Social Security, Present and Future”). This projected downfall of Social Security has many people wondering …show more content…
The privatization of Social Security basically means that each account would be individually owned and operated (Anders and Hulse). Presently, the funds received from each individual’s payroll tax are invested in the Social Security trust fund, which is controlled by the government (Koleva). As said by writer Yoana Koleva, “these accounts actually do not belong to the employees and are more of a tracking mechanism that provides information to determine the benefit amount received once the employee reaches normal retirement age” (Koleva). Therefore, privatization proposes that the accounts are privately owned and controlled, as opposed to the current system in which each individual’s Social Security account is controlled by the …show more content…
Some of the major problems with Social Security include: the declining ratio of workers to retirees, the decreasing personal saving rate, and the poor income redistribution done by the program. These rising issues cause many people to wonder if Social Security will be around in the future for their retirement. The answer is no, it will not last without reform. Deciding on which reform is another issue for the government, because each proposed reform has both positive and negative effects. There is not a single reform that will solve all of Social Security’s problems. No version of reform will positively impact effected all parties. Therefore, both retirees and workers need to accept that they will have to make sacrifices, whether it is reduced benefits, or increased payroll taxes, because without these changes Social Security will not last. The only way to salvage the program is to combine benefit reducing and revenue increasing reforms, and to find permanent solutions to the funding issues so that reforms will not be needed in the