Privatization of Social Securi
Social Security was implemented in 1935 as part of Roosevelt's "New Deal" following the Great Depression and the collapse of the American economy. It was enacted to be a fully funded retirement plan, meaning its benefits are paid out of a fund built up over the years from contributions made by Social Security taxpayers. The program's first step away from this was in 1942 when it began to pay out its first pension. There is a crisis within the program that we speak of today which deals with the impending lack of funds we will have in the near future. It is predicted that the so-called "Social Security trust fund" (a bunch of Treasury Department IOU's, in actuality) will be depleted somewhere around 2027. This is a concern because Social Security has been turned into a pay-as-you-go system. Today, workers outnumber retirees with a ratio around 3.4:1. Once the baby boomer generation begins to retire and causes a reduction in the work force, the worker to retiree ratio will be closer to 2:1 by 2040. This is a distress to our nation because we will not be taking in enough money to pay out the pensions of the retirees. Our government has already tried to reduce the impact of the Social Security problem by raising the percenta
Of all the options proposed, the current state of the stock market must be considered. We believe that the government will be extremely hesitant of privatization after the September 11th terrorist attacks. Questions are weighing on all of the politicians minds. What if so many Americans' Social Security funds were invested in the stock market and they lost practically everything? What would the government be forced to do to support a generation void of Social Security pension funds? The debate over privatization may come to an end because Americans are so risk adverse. Nobody wants to risk a retirement income in a stock market so hapless in its turns. There is no way to foresee the future of the stock market and therefore, no way to foresee the future of Social Security. It all comes down to what Congress and the President believe to be the best method to save the impending state of Social Security. All future retirees need to hope that we can look forward to the sense of well being generations before have experienced. No matter what, start investing in an IRA! From 1994 - 1997, the Advisory Council on Social Security worked on a solution to the forthcoming problem of lack of funds. By the end of this period, the committee had made no clear-cut decision, but rather a set of three possible resolutions. This put more stress on Congress and the executive branch because they would be forced to choose the best selection. Meanwhile, interest groups are lobbying for support for their positions, each with valid arguments. President Bush himself has said that he opposes raising Social Security taxes or reducing retirement benefits (Zeller 2). He also unveiled a new plan in his state-of-the-union speech using projected budget surpluses over the next fifteen years to reinforce Social Security finances. About $700 billion of this would be invested in corporate stocks in addition to subsidies for low-income workers called Universal Savings Account, using the acronym USA's ("Social Security"). What must be taken into account, however, is that this speech was made in 1999, before the terrorist attacks. According to CNN correspondent Annelena Lobb, "After Sept. 11, Washington lawmakers pledged $15 billion to help airlines, $20 billion to aid New York City and another $1.5 billion to fight bioterrorism. The list of upcoming defense and security expenses looms large, and it's questionable whether government funds for the transition to privatization will be available anytime soon." With all of the debates occurring, there are four major choices, three of which were proposed by the Advisory Council. The fourth, and most obvious, would be to leave Social Security alone to ru
Some common words found in the essay are:
Social Security, McDermott Privatization, social security, York City, Alan Greenspan, Straight Talk, Advisory Council, Deal Depression, Social Security's, Lobb Sept, stock market, Congress President, privatization social, corporate stocks, advisory council, option proposed, payroll tax, trust fund, mutual funds, privatization social security, proposed advisory council, ssa risk, invested corporate stocks, option proposed council,
Approximate Word count = 1817
Approximate Pages = 7 (250 words per page double spaced)
|
