That's a plan for financial disaster. Once that hit, you would find NO ONE in the world will want to finance the US Government debt bohemouth, and our children and their children's children will be paying 75% or more of their pay in taxes to cover it.
Recall that the White House has said that SS taxes would have to be raised to 50% to cover just the $12 Trillion shortfall! How high would general taxes have to be raised if you suddenly stopped deducting any SS at all? Or do you propose to leave it on the federal debt forever so it can cost us compounded interest until the government collapses from the weight of it's debt?
If you have a practical suggestion to get around that problem, I'd sure like to hear it.
Your plan would REALLY be "This is the IRS - send in all your money."
First, borrowing money to pay these costs would be ill advised. I have never suggested such a thing.
Secondly, if the social security tax were abolished, then there is no reason why this cost could (or should not) not be funded from general revenues. The shortfall you are describing occurs over decades and would not be as burdensome as you imagine, especially since after an initial painful period, the costs would gradually decline as the number of SS recipients gradually declined. Some increase in general revenues would certainly be needed for quite a few years to replace the loss of the SS tax, so a tax increase might be needed, but this shouldn't require a larger total tax bill than before. What is needed is a growing economy, and a less "progressive" and simpler tax structure can help create that.
Thrid, this transition has already been successfully accomplished in several countries, most notably Chile, which moved rapidly from a SS like system to a 100% vested and individually controlled system very quickly, and found the process both politically and fiscally realistic.
Fourth, the entire process of streamlining, simplifying, and updating our tax and savings systems might best be done simultaneously. Doing sso would allow a rationalization of the entire structure, and might ease some of your fears.
On the other hand, such changes might just play into them.
That's Social Security for you. Well described indeed! Hats off to Franklin Roosevelt!
Your post are actually pretty persistent at pointing out the problem.
My point is that since there isn't any easy way out, unless you have a proposal to get somebody else to pay for it (the Europeans?), lets at least stop making it worse, and stop doing so NOW, not later.