Try to imagine a company. It is an investment company. For a mere 15% of everything you make, they will build you a savings fund that will take care of your retirement and provide you with health insurance when you can no longer insure yourself. Companies like that exist. While the percentage is nominal, if the average American could do this, beginning on the first work day and investing through retirement -- 15% of everything he or she owns -- putting it into a retirement fund, that person would have millions of dollars in reserve for whatever needs arise. Some people have been smart enough to do that.
Now suppose we found a company that demanded that percentage, and had some management problems. First, the money they took was not officially "yours" anymore. Next, they were allowed to dig into your hard-earned savings and spend it on their own interests. Also, once you got into the program, there was no way to get out. The company operated each year in deep debt -- not millions, but billions of dollars. The board of directors responsible for the funds dipped into them for personal projects. Also, you were advised that if you tried to take the money too early you wouldn't get as much. Even if you waited until 70 to begin drawing on the funds, they would not come near what you made as your regular salary when you were working. Then, finally, suppose that you were to die the week before you were eligible to begin drawing on this lifetime fund. Your family would get a pittance to bury you, but all those deductions from your hard-earned funds would just be absorbed into the company's superfund. You probably think that the government has some agency that could investigate such a company and shut it down. Sadly, this company exists, and it is owned and operated by the government. If the Social Security Administration were a private business, the SEC would have shut it down and jailed its directors years ago.
If Americans were allowed to take even 10 percent of their own money and invest it in growth mutual funds, and they began this before they were 25 years old, we would have a nation of millionaires in their 50's. These millionaires could provide for their own needs, prescriptions, and health care -- without all the ugly paperwork and third parties to "handle" such things.
It is interesting to note that the very people who regulate our own mandatory Social Security do not have any confidence in it. Congress has its own federally legislated retirement system that is secure and rapid-growing, and will not run out of money by the middle of this century. Would you eat at a restaurant where you knew that the owners and employees all went somewhere else for lunch? We are being forced to do this.
Perhaps if our own congressional representatives were forced to depend on "Social Insecurity," they would be more careful in their management. Perhaps we could begin re-funding the SSA by using the obscenely huge pool of money that legislators have piled up for themselves. Maybe if legislators would only be given the options that the average worker in America is given, they would open new talks and debate about giving their options to us.
A few years ago, some people bounced around the idea of "privatization" of Social Security. The outrage was heard across America, and I am appalled that most Americans would rather opt for 850 dollars a month when they turn 65 than the millions they could make on their own. The ignorance amazes me, especially since most people my age will not even see that 850 dollars a month. When the baby boomers begin to crowd the geriatric wards and demand their cheap prescriptions, both Medicare and Social Security will be unable to stand their ground because there will not be enough workers in the next generations to give their 15% to pay our bills.
Why do we imagine the government can manage our personal assets? They can't even manage their own. What must we do? First, we should write off that 15%, unless we can figure out a legal way to put Social Security into the hands of the people that should be in charge of it: those that will have to live on it. With the remaining 85%, we should take another 15% and do what Uncle Sam should have done in the first place. At my age and salary, it's probably too late for me to be a millionaire, but I'm counting on my kids making it. By the time they retire, of course, they will need, not millions, but tens of millions, just to match inflation, but it can be done.
We have been gouged and robbed by a giant corporation that we have no option but to join. And instead of throwing the directors in jail, we faithfully re-elect them every 2, 4, or 6 years.
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