Libertarian Essays -- 'Fixing' Social Security

'Fixing' Social Security

by Estelle Edwards, 03/12/05
The trouble is this system was a ponzi scheme to begin with, and there will be no 'neat' or 'fair' way of fixing it. You can't pass on benefits to your heirs. You have no choice - it's mandatory. Since when is a pension plan mandatory? In reality, social security is a welfare plan. The best we could do is phase it out slowly. Here's my solution.

All those workers who wish to completely opt-out of the system - put an end to withholding - should be allowed to do so with the understanding that they will forfeit what they already paid in. That's the only way to implement this without hurting the people who are currently dependent on the system for disability checks, SSI, etc.

An end to withholding for those wanting to opt-out would mean an automatic pay raise - even a kid working at McDonald's will benefit. With extra money in their checks people could start a Roth IRA, put more in a 401K plan, fund their own disability insurance through a private company, and still have enough to fund a health care plan. For those who are affluent enough, the millionaires and billionaires among us, simply ask them if they wish to opt-out of collecting benefits when they retire. Again, they will forfeit what they paid in. It's the only way to phase the system out slowly without hurting the current elderly population. Eventually, the ratio of people who use the government plan will decrease, and when the last person collecting benefits passes away, that will be the end of social security.

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