Privatizing Social Security will benefit only Wall Street brokers with their fees and commissions. To expect benevolence from financial houses is fantasy, even no-load mutual funds. For the those on the low end of wages, investing an average of $1400 — but another tax deferred shelter — a year [including employer match] would be devastating to the national debt, and would only increase outsourcing and overseas investments, while retirement benefits would amount to a minuscule sum juxtaposed to the reduced benefits in social security. Moreover, privatizing would strip the full intent of serving the disabled, widowed , and sundry other humanitarian benefits. Obviously the affluent — already in the high-end of savings and investments — will gain geometrically in face of the average windfall amounting to $3000 and more annually added to their tax deferred IRAs, 401k’s and low tax capital investments, and shamelessly adding to the squirreling of tax responsibility.

Social Security as we know it will withstand the influx of baby-boomers for almost another fifty years provided the government firms up the fund by paying its prodigious IOUs. The new senate minority leader says, don’t mess with the greatest benefit the world has seen. Rather repair it by increasing the idiocy of escalating the base on which it is based, namely wages. For too long the base has been ravaged by the economy’s failure to create living wages, downsizing the contribution of both employee and employer. Also the cap at $90,000 should be raised to at least $350K, but allowing the difference above $100K to be privatized at 4%, together with increasing the retirement age of professions, white collars and non-laborious blue collars, and at the risk of being bigoted, I suggest a woman’s retirement age should be a year or two higher, except for tough positions. In addition, there should be enacted a 1% national value added tax: a quarter of which would be earmarked each for SS, and home security and half to subsidize small business to maintain a “living wage” for employees.

Perhaps, then, those on the low-end will finally be able to take advantage of IRAs and 401k’s. For those who argue that the return value of personal investments far out weigh social security’s mandated investment in government issues, it can easily be remedied by the treasury department partially investing in honest, domestic corporations whose primary function is engaging in US infrastructure and environmental enhancement.

Far from making the poorer richer, the scheme of privatization is making the rich richer.

Copyright © 2004 Richard R. Kennedy All rights reserved. Revised: December 22, 2004.