Privatization Of Social Security Essay

1601 words - 6 pages

It’s a matter of either losing all that you have worked for and live in poverty when retired or allowing your hard earned dollars to grow and have a secure comfortable retirement. I believe that Social Security is a doomed Government Program and that Privatization of Social Security would allow for a more secure retirement plan for all Americans. Social Security was first created to help aging Americans in their senior years so they would not end up in poverty. Social Security was signed in as law on August 14, 1935 by President Franklin D. Roosevelt and was fully operating by 1940. Originally a retirement program, but Social Security now includes survivor benefits, disability benefits and Medicare and all together is the largest expenditure of the federal government. Evidence proves that today Social Security is not sustainable which is the reason that Social Security should be privatized, first, because it is currently unstable with a future outlook of becoming even more financially impossible. Next, privatization of Social Security will boost the economy, and finally, privatization will allow for a more comfortable retirement by putting more money in the pockets of the retirees and families.
First the reason why Social Security should be privatized is that it is unstable. According to a 2003 report published by the Social Security Board of Trustees declares by the year 2018, tax revenues will fall below program costs. Social Security will be paying out more money than it will take in causing it to be unsustainable. The government will then have the choice to make up the difference by dipping into the government budget, raising taxes or cutting benefits. It is reporting that over the next 75 years Social Security will face a $27 trillion shortfall. One contributing to the shortfall and for the instability of Social Security is because the United States demographics have changed and are still changing and if Social Security doesn’t change with them, then the system will be unable to meet its promises for tomorrow’s retirees and will burden the next generation. It will leave my generation, our children and grandchildren, with back breaking taxes, which will have its own domino effect of causing ever increasing inflation. To be eligible for Social Security, which once was at age sixty-two for full benefits and now is age sixty-six and soon will be sixty-seven and as the years go by who knows what the retirement age will be for us. Social Security is paid through payroll taxes which pay for the benefits of today’s retirees. Money in excess of what is needed to pay today’s benefits is invested in special treasury bonds. This system works well when there is a rather high ratio of workers to beneficiaries or retirees. For instance, in 1960, there were 5.1 workers for every Social Security recipient or retiree, but the demographics are changing because Americans are living longer and are having fewer children. Today, there are 3.3 workers paying...

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