Subject: RE: Why should Social Security reform happen now?
It is clear to me that not much will be accomplished unless we do the following:
1) Understand why many people are against "privatization" and discuss their objections in a constructive and informative way;
2) Be sure we use the same words with the same meaning: as an example, "privatization" for some means investment in stocks and bonds by individuals; for others investment in stocks and bonds by the Social Security Trust Fund;
3) Define carefully the many concepts related to Social Security which are often difficult to understand and yet they have a crucial relevancy to the discussion: such as defined benefits vs defined contributions; Unified Budget, On-Budget vs Off-Budget;the Social Security Administration could make an important contribution by including a glossary in their web site similar to the one of my web site:
[Moderator's Note: This is an excellent suggestion. Without a common vocaublary, it's very hard to discuss an issue. We are working to put together a glossary and welcome input from participants in the National Dialogue.]
4) There is vital need for educating workers that have not had a chance to go to college. It is obvious that those who have no knowledge of economics, personal finance, investments, stocks and bonds, real estate, will never feel comfortable investing in the stock market, even if they are told to use dollar-cost averaging to invest in S&P; 500 indexed mutual funds.
5) It would be nice if politicians stop demonizing each other by exagerating their opponent's position until it looks absurd.
This issue is too important to waste energy rebutting arguments which have no basis in fact. A good example is liberals stating that conservatives want to convert the ENTIRE Social Security system to a privatized system, because they get contributions from the "Wall Street financiers". It is well known that nothing is further from the truth. All sensible conservative politicians feel very strongly that a so-called "safety net" is absolutely essential. Only a realistic portion of the FICA taxes would be earmarked for investments.
