Questions You Should Be Asking About privatized Social Security
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Media Matters Commentary
I'm not ready to put the kibash on the idea of partially privatized social security just yet, but I'm close. The questions that would have to be answered are the following:
1. How will the transition, expected to cost 2 Trillion Dollars, be funded? I'm looking for a DEFINITE plan, not some pie-in-the-sky soundbite or guess that a rising stock market will cover the costs. Given the fact that the President PLANS to cut the deficit in half and make tax cuts permanent, from where is the money going to come? Hope is NOT a planning tool.
2. What is the expected fee for management of these funds by private companies and will it be limited? I don't think that I should have to pay the usual fees for management of a fund to which I am forced to contribute. Who is supposed to gain from this, me or the management companies?
3. Social Security was never meant to replace a pension or a retirement fund, what happens if the stock market dips or even crashes? Is the government going to cover the losses and if so, how? The idea of social security was that it was a fall-back that was kept safe from the vagaries of the business cycle and free market. It was a safety net, not a retirement income or investment.
4. How does privatized social security solve the original problem of a shortfall in paying for what is owed in the coming years? Isn't this SUPPOSED to be the goal or objective of social security reform?
These are just the most basic questions you should be asking and if you don't get the answers you want, I suggest you start writing your Congressman or Senator.
Story Link
Media Matters Commentary
I'm not ready to put the kibash on the idea of partially privatized social security just yet, but I'm close. The questions that would have to be answered are the following:
1. How will the transition, expected to cost 2 Trillion Dollars, be funded? I'm looking for a DEFINITE plan, not some pie-in-the-sky soundbite or guess that a rising stock market will cover the costs. Given the fact that the President PLANS to cut the deficit in half and make tax cuts permanent, from where is the money going to come? Hope is NOT a planning tool.
2. What is the expected fee for management of these funds by private companies and will it be limited? I don't think that I should have to pay the usual fees for management of a fund to which I am forced to contribute. Who is supposed to gain from this, me or the management companies?
3. Social Security was never meant to replace a pension or a retirement fund, what happens if the stock market dips or even crashes? Is the government going to cover the losses and if so, how? The idea of social security was that it was a fall-back that was kept safe from the vagaries of the business cycle and free market. It was a safety net, not a retirement income or investment.
4. How does privatized social security solve the original problem of a shortfall in paying for what is owed in the coming years? Isn't this SUPPOSED to be the goal or objective of social security reform?
These are just the most basic questions you should be asking and if you don't get the answers you want, I suggest you start writing your Congressman or Senator.
posted by Mike at 9:47 AM
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