Here's my rant...
Face, it social security as it stands for the general public now is doomed to fail. If the system continues without reform it will be bankrupt by 2017 according to most figures (give or take a couple years for others). This is not a Republican issue or a Democratic issue, both sides of the aisle have been claiming this. According to the Millenium Poll, our generation is more likely to believe that they will see a UFO than to receive Social Security benefits among retirement. Frankly speaking, the trust fund that our SS dollars are supposed to be coming from has no net worth...zilch. All it is is a file cabinet with a bunch of IOU's from the government.
This issue is important to our generation. Our grandparents payed 1 out of every 50 dollars of their paycheck into social security. The system will be there for them. However, right now, we pay 1 out of every 8 dollars of our paycheck into a system that won't be there for us when we retire. If nothing is done, we will soon be spending half of our paycheck supporting this broken system.
Unfortunately, when it comes to fixing this problem the aisle be comes divided and partisan politics are introduced. President Bush has released a report with his suggestions towards reform, some GOP congress members have introduced bills taking a step towards reform, unfortunately there haven't been any proposals from the democrat side. We need a bipartisan effort to get this fixed. As noted above, congress has a plan similar to personal acounts that gives them the choice to invest--why can't the general public?
Personal Retirement Accounts (PRAs) are necessary for a valid solution.
First, PRAs would strengthen the economy and secure jobs. Without PRAs, Congress would be required to either raise our taxes by 25% or to slash benefits in half. Payroll taxes have already been raised 40%, and look where we are today. A little thing that many fail to mention, is that businesses pay taxes to SS at a rate proportional to that of the employees. If the payroll tax is increased yet again, it would send businesses (most notably small ones) into financial turmoil leading to layoffs and economic decline. (and no, i'm not going to site mead in 98 or some other BS). According to Martin Feldstein (Harvard Economist), Social Security reform could create atleast a million new jobs for our generation, increasing incomes by $5000, and add $10-$20 trillion to our economy.
Second, PRAs promote freedom and choice. We would not be forced to invest, but we would be given a choice to invest some of our payroll tax into a plan of a mixture of stocks and bonds for our future. It gives us control over our future.
Third, PRAs ensure a safe future. Right now, SS surplus (what little of it there is after the government goes on yet another spending spree) gets 2% interest, if it's lucky. Depending on the bill, PRAs could allow for a 4-7% return. This extra compounding interest would make up for the shortfalls in the status quo.
Fourth, if you want some empirical evidence, look to Germany, France, and Chile. Germany and France were at the same juncture as the US a few years ago. Without any reform, they are now reporting raising unemployment numbers and shrinking economies. Chile, on the other hand, fixed its system, and is now reaping the rewards.
Fifth, PRAs will help us pursue equality. Despite modern medicine efforts to achieve equality, ethnic minorities have a lower life-expectancy. Many die before reaching the age which they can start receiving benefits. Due to this, they pay into a system all their lives, but never see any of it back. PRAs will allow for the family to receive the benefits if the direct beneficiary dies, not leaving them stranded with nowhere to turn (currently only dependents receive entitlements from SS). This also applies to those who become divorced. If you were to stay home while your spouse worked, and later became divorced, you would not be entitled to any money from the social security system in the status quo. That's a problem if say you were to become divorced a year before you were scheduled to receive benefits in the sq system. Additionally, PRAs would allow the working lower-class a chance to invest in the markets and their future, an opportunity that many do not have today.
So, there's my 2 cents. I could rant on longer, but I'm afraid that would simply bore you all. I'm interested in hearing y'all's take.