Social Security's Uncertain Future - Essay Example

Social Security's Uncertain Future The 70-year-old Social Security program that was begun under Roosevelt's New Deal policies has gone through little change since its inception. Recently, however, there has been much heated debate about the administration of the program and its uncertain future. The current administration has called for an overhaul and suggests working towards privatization of the program. The debate is not divided along party lines. Generational differences, economic status, and special interest groups all bring something to the discussion.

As is usually the case, the argument revolves around each person's own self-interest. The public has been fed information that has swayed the debate as each camp tries to gain public support. It is fair to say that the truth probably lies somewhere in the middle and that is also where we will find a solution.Reaching an agreement is difficult because of the misinformation that continually comes out of our nation's capitol. Baby Boomers are just now beginning to enjoy the benefits of the program.

They have been told that the system is broke and they rightfully fear that they may not reap the rewards from the money they have spent a lifetime contributing. Shipman claims the system is a,"[.] coercive, intergenerational transfer tax system that relies on unrealistic assumptions and pays unreasonably low benefits". From their point of view, an overhaul offers them some hope that the system will be functional when they retire. But is their fear well founded There are well-intentioned people that say the panic is all for nothing.

There are political factions that insist the system is not broke and with a little tweaking it will operate as intended for decades. They contend that the people who have the most to gain from privatization are large banks, brokers, and insurance companies. It is these powerful lobbies that promote fear about the system going bankrupt. The opposition insists that the privatization movement is using inaccurate data and scare tactics. Look to the middle for the truth and you will probably find a solution somewhere between the two extremes.

Every civilized industrialized nation needs a program to care for their elders. The guarantee of a Social Security check for our seniors is a necessary function of our government. Yet, in a capitalist society everyone should have an opportunity to make choices for themselves. Critics of privatization say it is too risky and undependable. However, a system that uses voluntary private investments along with a government backed guarantee would allow the system to function as it does today while offering a choice.

The government guarantee could work much like the Federal Deposit Insurance Corporation (FDIC). Investments would be guaranteed at a minimal return. This would put additional responsibility on the government to insure sound investments by the financial community.People that grew up during the depression have already retired and have little interest in seeing the system changed. They remember the hardships of the 1930s, the bank failures, and the rampant unemployment. They have little trust in privatization.

Younger people who have recently entered the workforce have the most to gain. Well managed private investments could result in returns that far exceed the present system. Both parties should have the right to choose which plan to participate in. Adding a governmentally backed option to the present system may be the only way to reach a consensus. ReferencesShipman, W. G. (2006). Bernanke calls for social security reform. Retrieved October 13, 2006, from http://www.socialsecurity.org/