Social Security:
Why Reform?

Many people say Social Security is one of the most effective government programs ever enacted. The truth is that the current Social Security system is an expansion of government control with few benefits to the American people. A very interesting reform has been proposed. But first we must ask ourselves: Why change a system that millions of seniors rely on as their only source of income?
The answer is simple. The retirement system devised almost 70 years ago during the Franklin Roosevelt administration has become dated and faces new challenges in the 21st century. Social Security is facing four serious problems that threaten the system.


I. Increasing life expectancy
Social Security was established when the life expectancy was 61. Today the life expectancy is 71 and increasing. 1.4 million Americans today are in there 90’s and 64,000 are 100 or older. Workers have to support more retirees over a longer period of time. This significantly lowers the ratio of workers to retirees.

II. Impending retirement of the Baby Boom Generation
The “Baby Boom Generation” refers to those born between 1946 and 1964 when there was literally a baby boom. There are 77 million Baby Boomers in America. In 8 years(2008) the first of these will become eligible for Social Security. This leads to our third problem.

III. The resulting decline in the ratio of workers to retirees.
The ratio of workers to retirees is the number of workers putting money into the system as compared to the number of retirees receiving that money. In 1945, the ratio of workers to retirees was 45 workers for every retiree receiving benefits. Today, that ratio has dropped to 3.4 workers per retiree. By 2030, that ratio will shrink to 2:1. It is impossible to rely solely on economic growth to fill the void. Some change must be made.

IV. A declining rate of return on Social Security
The current rate of return from Social Security is less than 2%! The rate of return of most banks accounts is from 4% to 6%. You would have a higher rate of return if you kept your money in a savings account than in Social Security. Not to mention the fact that your benefits could never be cut. This is why we need to privatize the system.



How will Privatization affect me?


I cannot stress this fact enough. SENIORS: NO ONE WILL TAKE YOUR BENEFITS AWAY! Politicians have engaged in the practice of scaring seniors into voting for them for years by saying, ‘The other guy will take away your Social Security check.’ As of late, Democrats have been scaring seniors about privatizing the system. The government has made a commitment to you and that commitment would be protected above all under the Republican privatization plan. But workers should be able to take a small part of their Social Security and put it into sound investments THEY control. If a worker making $20,000 a year started investing 2% of their Social Security in sound investments they control at the age of 20, they will have $100,000 in assets the day they retire on top of the other 98% they put in under the current system. The government would never be able to take away assets gained under such a program. They would be yours to pass on to your children when you die.
Democrats call allowing Americans to invest a portion of their own money in the stock market a “risky scheme.” Almost 50% of all American households own Mutual Funds--that’s well over 90 million people! Benefits have been cut over 20 times to keep the program solvent. We must do something to put more money into the system. We need a plan that allows young Americans to invest part of their own money and achieve higher rates of return while still keeping our commitment to retirees and those on the verge of retirement. Contact your local Congressman and tell him you want a plan to privatize Social Security. And above all make sure you vote.

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