On that we agree.
The problem with the whole "privatization" argument is that the history of returns on US stocks is a history of voluntary stock ownership. Remove that element and you change the entire character of the capital markets. It's astonishing to me how cavalierly that is dismissed, or even thought of. Voluntary ownership is precisely why the capital markets work as well as they do.
The trillions of SS funds are simply too big of an elephant. There is simply not enough room in the US stock market for what is there already and the SS funds. One of the self-adjustments will probably be a decline in ownership of US stocks outside of SS. Which is probably a bad thing, IMO.
Bottom line is that there is simply no feasible way to safely store for 40 years an amount of wealth comparable to one year's entire GDP.
That says a mouthful….How much will be needed 40 years from now…what about inflation and future increases in taxation.
I can recall in the early 70’s, when a co-worker who had been anticipating his retirement had to change his plans because the run away inflation left him with about 40% of what he expected to get.
Even these 401(k) plans that everyone is counting on…It’s a relatively new thing, in that not very many contributors have begun to take their stored up benefits. What will happen when these workers stop working and those funds are loosed on the economy?