Question 2: What is your position on gutting social security to set up
personal accounts?

I will assume from the choice of the word "gutting" that the
submitter of the question opposes personal accounts. I should point
out, though, that the idea of personal accounts was good enough to
earn the support of President FDR--the original architect of Social
Security--so I find it interesting that so many defenders of Social
Security's status quo oppose the idea so vehemently.

I suspect that the submitter may be mistaken about the nature of
Social Security itself. Many people believe that as they pay into
Social Security, that money is set aside for them so they have it
when they retire. Not true. Money that you pay into the system is
immediately paid out to current recipients. The system today is one
big economic and demographic gamble, and to support it is to place a
lot of blind faith in unpredictable variables aligning perfectly
decades from now.

You see, there is no money being set aside for Social Security, and
there never has been. There is no such thing as a "Social Security
Trust Fund" that holds any money. If there's nothing there in the
first place, then I don't see how there's anything to "gut."

Instead, personal accounts would allow people to accumulate money
under their name, rather than placing their futures in the hands of
politicians who are always looking for new places to find money. To
me, this is obviously better than the current situation.

If you're currently retired, you probably don't mind Social Security
as it exists now. You probably only care that you'll get yours, which
you will. That's the problem with giving control over your money to a
political majority. If you're not in the majority, don't expect to
see your money. Perhaps you've heard the sayings, "Any government
that robs Peter to pay Paul can always count on the support of Paul"
and "pure democracy is a sheep a four wolves voting on what to eat
for dinner." That's Social Security in a nutshell.

There are many people my age who are quite upset that we'll have to
be footing the bill as the baby boomer generation starts collecting
Social Security in larger numbers. Quite simply, the system will fail
for the same reason that pyramid schemes always fail. Eventually,
there aren't enough people paying into the system to satisfy the
demands of people who are drawing benefits.

The baby boomer generation is huge, much larger than any generation
behind it. Yet the generations behind it are comprised of the people
who will have to pay for the boomers. Mathematically speaking, the
system is doomed to fail. Who will be left holding the bag? People
who are currently in their 40s and younger. Is that fair? I guess
your perspective depends on whether you're the one who's gonna get
screwed.

If Social Security is left as is, my taxes will have to go up
substantially to pay for the next crop of retirees. Will my
retirement benefits go up substantially as well? Or will my benefits
be less--or even nonexistent--even though my generation will be asked
to pay more than any before it? I'll leave that as an exercise for
the reader.

The bottom line is, if you trust politicians with your money, then I
guess you'll like the system as is.

__________________
Bart Hook
Administrator
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