My Position Statement
My position is that social security should not be privatized because the economic impact for individuals and the nation are enormous.
Economic Argument against My Position
A number of economists support privatization of social security ideology for a variety of reasons. First, there is a general argument that the social security is not an investment system (Estes 10). Thus, workers inject their money for a considerable length of time with very limited returns emerging from this form of saving.
Secondly, current system tends to limit an individual’s ability to engage such savings in diverse investment platforms that would lead to an improvement in their returns (Idemoto 1). On the contrary, current system gives exclusive investment rights to the government. Thus, privatization will offer individuals an opportunity to have control over their investments and investment portfolio diversification on their savings. Smart investments by individuals will yield higher returns. There is a general ideation that the investment market will continue to grow in a near-exponential trend.
Privatization will also lower taxes for individuals and corporations (Idemoto 2). Current taxation for individuals and corporations tend to be exorbitant. When the social security is privatized, individuals no longer have to pay perky taxes associated with social security (Adam 2). Privatization in this case means individuals making their retirement investment decisions rather than having the government or an organization make such decisions for them. Employers too will no longer have to pay these huge social security taxes. The additional contributions towards an employee by these organizations will no longer be a regulatory requirement f...
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...lenge in social status, discrimination on women, the injured, and disabled, poor investment, and long-term decline in stocks return when evaluated from an inflation adjusted returns point of view. Thus, social security should not be privatized.
Works Cited
Adam, Antonis. “Macroeconomic Effects of Social Security Privatization in a Small Unionized Economy.” CESifo Working Paper 1371 (2004): 1-16. Print.
Estes, Carroll L. “Social Security Privatization and Older Women: A Feminist Political Economy Perspective,” Journal of Aging Studies, 18 (2004): 9-26. Science Direct. Web. Apr 7, 2014.
Idemoto, Steve. “Social Security Privatization in Chile.” Social Security (2008): 1-7. Economic Opportunity Institute Online. Web. Apr 7, 2014.
Williamson, John B. Social Security Privatization: Lessons from the United Kingdom. Boston: Center for Retirement Research. 2000. Print.
This mini-paper will discuss the social welfare system. The mini-paper includes a discussion of welfare Policy, residual and institutional approach, and what is Social Welfare and Social Security. Midgely, (2009), pointed out that social welfare systems deliver services that facilitate and empower our society, especially to those persons who require assistance in meeting their basic human needs. The goal of social welfare is to provide social services to citizens from diverse cultures, and examples include Medicare, Medicaid, and food benefits. Midgley,( 2009).
To understand how privatizing social security will help the social security program in the future, first it is important to know what it is and what it does. How social security works now is that everybody that gets benefits from the social security program all get them from one big pot, so to speak. By privatizing the different accounts, they can earn interest faster and make more money for the consumer on an individual basis. This can work better to because the accounts are individualized and earn the right amount of money for the different financial situation that the person is in. This will be a big change for the way that social security is run, but it is for the better and it will help lots of older Americans and the social security program in general for years to come.
Throughout the 20th century governmental responsibility has made remarkable progress. One major milestone of the widening of the responsibility of the federal government was it’s making an obligation to care for the elderly and retired in the form of social security. In 1935, the Social Security Act was enacted by the federal government to provide financial security to the elderly, retired citizens in America. Although the federal government first took on this responsibility in 1935, it is still affecting our lives today. However, social security would not have advanced this far without many organizations and individual reformers to begin and improve social security throughout history.
pros and cons. The pros would be that the people who really needed social security would be receiving it, and it would also be able to fulfill it’s initial purpose, which was to act as a safety net for retirees. One of the cons would be having to determine the amount of income that would qualify as a high-class income.
Social Security Administration, Social Security Programmes Throughout the World, Washington, 2008/2009; Heymann, J. et all, 2007.
Social Security is a system that was set up in 1935 after the Great depression to help people get through tough times. "Social Security is now used by nearly 44 million Americans"(policy.com). Only people who payed into social security are eligible to collect when they retire. Many people think that they receive the money they pay in but that is not total true. The money that you pay in is used for the people that are receiving it now. "In 1950 there were 16 workers for every beneficiary; today there are only three workers per beneficiary"(policy.com). There is more money going into social security then coming out now. The extra money goes into a trust to be used when it is needed. By the year 2032 those numbers are going to drop. By this time most baby boomers will be retired and collecting social security. This will put a big strain on the funds. There will be more money going out then coming in. And it will not take long to use all the money that is in the trust. By the year 2034 they will only be able to pay 75 percent of the beneficiaries. "The projected average monthly Social Security benefit in 2032 of about 1,100 (in 1998 dollars) would fall to about $800, and would drop further in later years. Average benefits for low-wage earners would drop from $670 to $480"(www.ssab). Theses cut would effect the people just starting to receive benefits and those who are already receiving benefits. And with each year these benefits will decrease. As these benefits continue to decrease "the percentage of aged people living in poverty would rise"(www.ssab).Most people believe this is happening because of the baby boomers generation. There will be more people taking from social security then giving in. By the time my generation is eliable to receive social security there may not be any money to give.
Expanding Social Security Spending In recent decades, entitlement programs have constituted a substantial portion of the
Michael Jones worked his whole life. At the age of 15 he started as a dishwasher at a restaurant a mile away from his house. He never graduated high school because he had to quit school to help his single mom support a family of six. There were many times in his life where he worked two jobs, but at minimum-wage, if that, 80 hours a week still did not go far. By the age of 20 he was married, and soon began to have a family of his own. Michael is a simple man but a hard workingman. Michael rarely took vacations, worked 60+ hours a week, and raised four daughters of his own. After about 25 years of marriage Michael and his wife divorced. Recently Michael turned 65, and against his desire to keep working, his doctor suggested that he retire, due to suffering from two heart attacks, one when he was 50, the other when he was 62. For 50 years Michael has worked many jobs, unfortunately, due to his limited education, he often worked minimum paying jobs. During the first half of this working life he was supporting his family, and Michael was only able to save for retirement after his children had graduated college. Only his latest employer offered pension plan. Now after working his whole life, Michael is left with $305 a month from his pension, and $742 from Social Security. Social Security has become his major source of sustainment. The Social Security Administration (SSA), has become a lifesaver for Michael and most retirees. This paper will attempt to answer how the Social Security Administration came to be, and what it does for the country and its hard working citizens. It will give a brief overview on the history of the administration; what statutes give the agency its authorities; ...
"Social Security Should Be Run by the Government" by Institute for America's Future.Capitalism. Noël Merino, Ed. Current Controversies Series. Greenhaven Press, 2010. Institute for America's Future, The Perils of Privatization: Social Security Privatization Cuts Lifetime Benefits; Makes Senior Citizens Vulnerable to Poverty: The Impact in the United States. Washington, D.C.: Institute for America's Future, 2008. Reproduced by permission. .
22. Kennith Davis, "The Birth of Social Security," in Visions of America's Past, ed. William Bryans et al. (Plymouth: Hayden-McNeil Publishing, 2011), 327.
Wheeler, Peter. "Social Security Programs in the United States." Programs in the United States. Social Security Administration, 1 July 1997. Web. 4 May 2014.
Blackburn, S (1995) 'How useful are feminist theories of the welfare state?’ Women's History Review, 4(3), pp. 369-394.
According to Congressman Richard Gephardt, the social security was not meant to be the sole source of retirement income but rather as a foundation for retirement to give all working Americans a safety cushion. There will be money in the fund until 2029, so distressing baby boomers don’t have to worry. After that money is depleted the revenue from the payroll tax will be sufficient enough to pay 75% of every social security benefit for the subsequent 75 years. But how many burdens should be put on the young and middle age individuals, whose taxes basically pay for government retirement ...
Uhlenberg, Peter. 1992. “Population Aging and Social Policy.” Annual Review, Sociology, University of North Carolina, Chapel Hill.
While there are certainly arguments against socialism, the arguments against it outweigh. Socialism is better because it allows for the government to provide for the basic needs of all citizens—this is impossible in a market economy, and outweighed by the negative aspects of a command economy. In a time of great national economic and political turmoil, it is important that a consensus be made as to the best economic system for the U.S. and the rest of the world. In my opinion, this best system is socialism.