What does privatized social security actually mean? How is it different from social security?

Answer 1

The federal government is notorious inept at effeciently administrating anything. Anything done by the government could be done in the private sector more effectively and at a lesser cost with less beauracracy.

"railroad benefits, like social security benefits, are not contractual and may be altered or even eliminated at any time" - United States Railroad Retirement Board v. Fritz, 449 U.S. 166, 174, 101 S.Ct. 453, 459 (1980)

http://www.socialsecurity.org/

Answer 2

Here is how social security really works. First the workers have social security taken out of theri payroll. Then the money is put in a fund. The government borrows this money in the general fund in the form of zero interest bonds. That means there is no place where the money is stored. Then the people that have retired often get more money than they put in it unless they died before they could get it. Not only that, there is cost of living adjustments to keep pace with core inflation (the percentage is often quoted in the news when they talk about inflation). To make matters more interesting, there isn't enough workers to pay the money needed to pay for the elderly and it's getting worse. That means the elderly, especially with the baby boomers will draw money that doesn't exist. This shortfall between what is needed to keep it going the way it's suppose to go and what the government has is $10 trillion. This money will either be printed, taken from tax money or the people just won't get their paychecks until the shortfall goes away (by the elderly dieing off). Medicare is projected to have a $30 trillion deficit for the same reason.

Privatized social security is to have everyone forceably fund their own retirement without guaranteed income. Most of this will be funded through forceably buying government bonds with a mix of stock indexes. There will be no inflation adjustment and a limited amount of money, which means it's possible to outlive what a person is forced to put in it.

Answer 3

Right now, social security is primarily funded through payroll taxes. If you have a job, you pay for it. However, by the time you're old enough to retire and use the money, it may not be there, because it's currently being used to fund social security being paid out today.

President Bush (and others in the past) have suggested partial privatization, where part of social security would be funded by the government, while individuals would be responsible for maintaining personal accounts. These accounts can somewhat be compared to IRA's or 401(k) accounts.

There's a really detailed article at the link below.

Answer 4

Privatized means the funds are kept in a private company, like an insurance company or a bank. Government social security is in a government fund and has been used for purposes other than social security by our congress. If it is in a private company, the law will keep it safe there, since everyone but the government itself has to follow the law,

Answer 5

Right now, the government holds all the money that people pay into the Social Security system. Privatizing it would mean allowing people to take some of the money and invest it somewhere, like in stocks or private bank accounts.

Answer 6

2 Part answer. First, if all the money deducted from my paychecks over the years for SS had been invested in SAFE low interest investment accounts, mutual funds etc, instead of being at par, about $30,000, it would be over $3 million.
Second, the proposal is not to "privatize" SS, but to invest about 25% of your account in these safe sources. Unfortunately the only hangup is that the bulk of the massive profits derived from such a scheme would somehow find it's way into the U.S. Treasury to buy $130 Toilet seats and $65 hammers...

Answer 7

walmart is what it will look like ~ only when there is competition will the price be low when the big box is all there is the loop is closed and the lazy life of buying everything at one place will control every other place til it can regulate just like a utility