Lewis Lang wrote:
Bush says that he wants to switch from the current Social Security
system to an individual retirement account (IRA?) system. He swears
that people over 50 will not be affected. What about the people under
50? Will they get screwed?

--

Lewis Lang

Up until about 12 or 15 years ago, I would have relinquished all claims
to the monies that I had put into the Social Security System in return
for my investing all future monies. At that point, I would have come
out well ahead. The situation has changed since then:

1. The stock market has remained rather stagnant since recovering from
the recent recession. The days of investing in anything and making a
killing are long gone.

2. This administration is not the most trustworthy group in recent
memory. Their real agenda is not particularly obvious.

3. By most accounts, Social Security is not in grave danger. Raising
the tax limit to say $100K will push the problem area many more years
into the future. It is definitely NOT time to panic. See item 2.

4. Read up on the Brits experiences with a plan quite similar to the
Bush plan. By most accounts it has been a disaster. One of the repair
options being studied is a plan like the current US plan.

5. Read up on the Chilean experiences where results have been better.

6. This may not be a good time to start adding to the $7+ trillion
national debt especially if less of it will be purchased by Social
Security. I am not convinced that the People's Republic of China
(holder of a good chunk of our debt) always has our best interests at heart.

I would suggest that the problem be characterized. The original intent
of SS was to provide a modest sum to those overtaken by age or
infirmity. The workers, employers, and now the government are putting
money into the system. Is there a reason to change this rather
minimalist system? Should we go to a system where the risk is higher
but the worker may end up with a nice retirement? The other side of
risk is a smaller nest egg. If we do this, can we take the planning out
of the political arena and let a group (or groups) of academics design
methodologies? See item 2 above.

The administration, congress, and the media are supplying much more heat
than light on this subject. And we don't even seem to mention the
really large domestic problem areas: medicare/healthcare, energy,
crumbling infrastructure, etc.

Enough of this. Time to make some sawdust.
mahalo,
jo4hn