Originally Posted by Cato

1. What is Social Security Choice?
The option of personal retirement accounts would let workers deposit their payroll taxes into personally owned and invested accounts similar to 401(k) plans or IRAs. Currently, workers pay a 12.4 Social Security payroll tax (FICA) on all wages up to $87,900, and Congress sets their retirement benefits. Under reform, workers would be able to deposit that 12.4 percent into their personally owned accounts. Workers and/or their employers would select a company to manage and invest that money. Over time, a worker's account would grow in value, culminating in a substantial nest egg. Once a worker had accumulated sufficient retirement funds, she could purchase a lifetime retirement annuity, which would pay a monthly retirement check.

2. Why does Social Security need reform?
Social Security is going bankrupt. The federal government's largest spending program, accounting for nearly 22 percent of all federal spending, faces irresistible demographic and fiscal pressures that threaten the future retirement security of today's young workers. According to the 2003 report of the Social Security system's Board of Trustees, in 2018, just 14 years from now, the Social Security system will begin to run a deficit. That is, it will begin to spend more on benefits than it brings in through taxes. Anyone who has ever run a business--or balanced a checkbook--understands that when you are spending more than you bring in, something has to give--you need to start either earning more money or spending less to keep things balanced. For Social Security, that means either higher taxes or lower benefits.

But even if Social Security's financial difficulties could be fixed by raising taxes or cutting benefits, the system would still need to be reformed because it is a bad deal for most Americans. Social Security simply costs too much and pays too little. Social Security's rate of return on payroll taxes is dismal (about 2 percent) and declining. Workers deserve a retirement system that will make the most of their money.

Originally Posted by redneck";p=&quot

If investing SS money is such a great idea, why haven't they been doing it with some or all of it before now?

Originally Posted by Liberty";p=&quot

Because they'd rather spend the money themselves. If they let you invest it, then that's less money they can use for their own purposes. They'd rather use it to pay for some new program that will buy points in their political future. If social security were truly a mandatory retirement account system, we wouldn't be hearing about a coming crisis

Originally Posted by redneck";p=&quot

... so now this is going to keep Congress from spending money? LOL!

I believe if you look at our current deficit, you'll find that it doesn't matter if money is actually there or not for them to spend it.