Re: conflict of interest

[Javier_L_Jimenez@Dell.com]

Certainly the Prudentials and Fidelitys have a vested interest in
any privatization effort, but anybody would agree that investing
money in stocks and bonds yields better results than the government
run pay-as-you go system.  I really wouldn't mind the financial
services companies from making money, if in the end I will be better
off.  If you think that these companies making a profit is a conflict
of interest then people, in your view, should not invest in mutual
funds, etc.  So why do they do it?  Because it is the way to
accumulate wealth and security for the future.

This argument is like the one on taxes; we shouldn't have a tax
cut because the rich are going to pay less.  Well, if I am going
to save 1 or 2% and they are going to save 1 or 2%, it works for
me.  Their 1 or 2% will be a larger amount of $$$, obviously,
because they pay more $$$.  In short, this is just another class
warfare tactic that moves no one forward.  Privatization is the
best alternative because 1) payroll taxes are too high yielding
very low returns; 2) the government still owes the money it took
from SS to cover general spending; meaning that not only higher
payroll taxes will be needed to support future retirees, but higher
income taxes will be needed, as well, to pay back the debt owed to
SS; 3) Young workers will get negative returns if any money at all;
4) the poor work harder and longer throughout their lives and live
shorter retirement lives; meaning that the taxes paid will end up
supporting other retirees that live longer lives.  On the average,
those retirees are the high and middle class that performed less
hard labor; 5) since workers own their retirement money and have
a right to it, unlike SS, their heirs inherit unused assets, assets
being a keyword because under SS there are no assets, there is no
capital, only a promise made by a handful of politicians to be kept
by another handful of politicians a generation later;

The set of values I would agree are needed are as follow: 1) Current
retirees should be taken care of; 2) current workers must have a
choice of moving to a private system or staying in the current
system; 3) workers that choose to move to a private system should
receive recognition for the taxes they have paid; 4) new workers
must go to the new system, so that there is a date certain when
the old system is closed down; 5) a safety net, paid out of general
revenues, should be put in place to provide for workers that cannot
at least purchase an anuity at retirement that will pay for their
benefits in retirement; 6) the government role as a regulator should
be to provide oversight of the investment vehicles available for
people to invest in; 7) investment choices should include:  stock
mutual funds, bond mutual funds including corporate and government
bonds foreing and domestic, and bank CDs.  No individual stock
picking, or investment in stock options or other derivatives; 8)
worker's ownership of their capital.

Javier Jimenez