Posted on 08/18/2005 11:21:28 PM PDT by rdmartinjd
FDR PROPOSED PRIVATE ACCOUNTS by Rod D. Martin, J.D. August 19, 2005 www.theVanguard.org
To hear todays Democrats talk, Franklin Roosevelt would be spinning in his grave if he heard todays debate about Social Security private accounts.
Theyre only half right. Hed be spinning if he heard todays Democrats.
Roosevelt was many things, but he was no fool, not on this point. The man who gave us the New Deal understood perfectly the limitations of Social Security. In honest moments, politicians correctly note that Social Security was never meant to pay for 100% of your retirement. And to pay for the part a government pension scheme couldnt, FDR had a very modern-sounding idea.
Announcing his plan on January 17, 1935, Social Securitys founder said: in the important field of security for old people, it seems necessary to adopt voluntary contribution annuities by which individual initiative can increase the annual amounts received in old age.
In other words, private accounts.
Seventy years later, Roosevelts words ring truer than ever. Social Security taxes -- just 1% back then -- now consume between 12 and 15% of most Americans income. They effectively eliminate any possibility of separate retirement savings without serious sacrifice.
And for what? Social Security checks remain a pittance, certainly nothing anyone should have to depend on as a monthly income; and with a $255 death benefit, they dont even pay enough to bury you.
Worst of all, you dont own your own money. You cant pass it on to your wife, you cant pass it on to your kids. And since government spends every dollar as soon as it comes in -- the trust fund is a myth -- theres not even any guarantee youll get to keep your money yourself.
But as President Roosevelt taught us, there really is a better way.
Under President Bushs plan, Social Security could finally fulfill its promise. Private account-holders could look forward to between three and five times the monthly check available under the current system. Most Americans would retire on a higher monthly income than they had when they were working.
And they wouldnt have to invest in anything risky to achieve this, or give up the safety net of government Social Security, or even obtain any specialized knowledge of investing. The tens of millions in (incredibly successful) private accounts around the world -- from Chile to Britain to Australia to the public employees in Galveston, Texas -- have already shown us the way.
Some pundits have pronounced the Presidents plan dead; but the rumors of its death are greatly exaggerated. Social Security reform can still happen, and happen this fall once Congress returns.
The best bill before Congress -- by a wide margin -- is Ryan-Sununu. It proposes placing half of your Social Security tax money in an account which you alone control: you will own it just like your IRA or 401(k). This would not only give every American a much higher retirement income than any other bill before Congress, it would also solve the problem of Social Securitys impending bankruptcy: as more Americans use their private accounts instead of burdening the current system, the Ryan-Sununu plan would create an ongoing multi-trillion dollar surplus roughly twenty years out.
This would completely eliminate the solvency crisis. More than that, it would give the current generation of retirees a huge benefit increase, and everyone else an enormous tax cut.
President Roosevelt understood: Americans need the right to contribute their hard-earned money to their own voluntary personal retirement accounts. These PRAs will let every American -- even our very poorest -- accumulate real assets, real nest eggs for retirement, and real inheritances for their children.
No one will benefit from this more than the lower and middle income working-class, who can never quite get out of poverty because the current system taxes away too much for them to save. No one, that is, except black Americans, whose lower life expectancy means they frequently die before ever receiving Social Security at all, and arent allowed to pass anything on.
IRAs and 401(k)s have sparked an enormous capitalist revolution, transforming millions of regular Americans from ordinary workers into investors. Its time to complete that revolution. Lets help every American participate in this very American dream. Its time the poorest among us had the same benefits from our free market system that most of us take for granted.
Its the least we can do, for their sake, and for President Roosevelts vision.
Copyright: Rod D. Martin, 19 August 2005.
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Rod D. Martin is Founder and Chairman of Vanguard PAC. A former policy director to Arkansas Gov. Mike Huckabee and Special Counsel to PayPal.com Founder Peter Thiel, he is a member of the Board of Governors of the Council for National Policy, a Vice President of the National Federation of Republican Assemblies (NFRA), and editor and co-author of Thank You President Bush, the definitive handbook to the second term.
SS was/is just another socialist tax. Give me and my wife back the $341,000 that we have in our SS fund; and I will STFU.
Um.
Ping!
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