Congress should allow young workers to redirect their payroll taxes to individually owned, privately invested retirement accounts.
Social Security is not only the largest American government program, it is the largest government program in the world. Roughly 40 million Americans receive Social Security benefits, and every working American pays Social Security taxes. Indeed, nearly 80 percent of Americans pay more in Social Security taxes than they pay in federal income taxes.
Social Security has long been considered politically untouchable—the “third rail of American politics.” But now a new consensus has emerged. Given Social Security's failing finances, declining rate of return, and other inequities, the American people recognize the need to dramatically restructure the nation's troubled retirement program. Polls show strong public support for transforming Social Security from its current pay-asyou-go structure to a program based on savings and investment.
With the public supporting Social Security reform and large budget surpluses available to help finance the transition, the 107th Congress has a unique opportunity to remake Social Security and provide future generations with a sound and secure retirement.
There are five main reasons to privatize Social Security.
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 2000 report