Michigan workers and retirees are threatened with sky-high taxes and an uncertain retirement if changes arent made now to the failing Social Security system.
Social Security is projected to go bankrupt in 15 years, when it begins taking in less money than it must pay out to the growing number of elderly retirees. Raising payroll taxes or cutting retiree benefits again is unfair and will only postpone the inevitable collapse.
Systemic changes to Social Security are needed to permanently protect the nest eggs of Americans. Privatizationallowing workers to invest their own retirement savings in the stock marketis one solution.
Countries including Chile, Great Britain, and Australia allow workers to invest all or part of their payroll taxes privately, and the results have been impressive. Chilean retirees, for example, now enjoy three times the benefits that they would have received under their government system.
President Clinton has called for a "national conversation" on Social Security reform. Michigan can take part by joining with states including Oregon and Colorado that have called on Congress to either privatize Social Security or let states design their own private pension systems.
Privatization will secure a prosperous retirement for Michigan workers of all generations.
For the Mackinac Center, this is Catherine Martin.