We are astonished over the amount of fear and consternation from the Left on the president's proposed reforms to Social Security (SS). It was just a few years ago, in fact, that the Left was shouting about the need to "save SS". They complained, especially Al Gore during his failed presidential campaign in 2000, about the need for a "lockbox" for SS, and that the system would be broke for future generations if major reforms were not undertaken. It seems clear that his concerns were mostly for raids from the Treasury, but there was also the strong message that the system in general was 'broken' and needed fixing.
Now that the Democrats are even further out of power, however, they claim that the system is NOT broken. Their fear, of course, is that now they don't have much power to stop any reforms that might wind their way through the halls of Congress and to the president's desk. They don't want the Republicans, and especially not George Bush to be able to take the credit for reforms that might actually work, as that would further erode their claim to be the protectors of SS from the 'evils of capitalism'.
Let's face it, the reforms proposed by the president are mild; Allow middle aged and younger worker the opportunity—if they CHOOSE—to divert up to 1/3rd of their 6.2% payroll tax for SS into private accounts. The amount of money is capped at only $1,000 in 2009, and will raise by about $100 each year thereafter.
The plan itself would work like the Thrift Savings Plan, which has been available to federal employees for years and is like a 401-k plan. There are several investment choices, diversified like mutual funds, and even includes a fund that invests in more conservative holdings as the worker approaches retirement.
Apparently many people are afraid of investing, and know little about it. That is hard for us at the LTS to believe, given the amount of information available to the average person these days. Most of us who work have some sort of a 401-k plan available through our employers, and IRA's have been around now for almost 20 years. The internet, which brings you this incredibly informative space, is loaded with financial advice, information, and results. Free seminars on investing are everywhere. There is no excuse for not being informed on the ins and outs of investing basics.
We support a plan that allows workers to invest part or all of their payroll taxes for SS into private accounts, and will monitor the debate and report facts and offer opinions on what is being proposed.