Opponents of allowing younger workers to privately invest a portion of their Social Security taxes through personal accounts have long pointed to the supposed riskiness of private investment. The volatility of private capital markets over the past several years, and especially recent declines in the stock market, have seemed to bolster their argument.
Topic:
Economics, International Trade and Finance, Markets, and Financial Crisis
News that the poverty rate has risen to 15.1 percent of Americans, the highest level in nearly a decade, has set off a predictable round of calls for increased government spending on social welfare programs. Yet this year the federal government will spend more than $668 billion on at least 126 different programs to fight poverty. And that does not even begin to count welfare spending by state and local governments, which adds $284 billion to that figure. In total, the United States spends nearly $1 trillion every year to fight poverty. That amounts to $20,610 for every poor person in America, or $61,830 per poor family of three.
The U.S. government is about to exceed its statutory debt limit of $14.3 trillion. But that actually underestimates the size of the fiscal time bomb that this country is facing. If one considers the unfunded liabilities of programs such as Medicare and Social Security, the true national debt could run as high as $119.5 trillion.
Topic:
Debt, Economics, Human Welfare, Financial Crisis, Governance, and Health Care Policy
There is growing bipartisan recognition that the pathway out of poverty is not through consumption but through saving and accumulation. That idea has led to a number of interesting and innovative experiments by state and local governments and by private charitable organizations and has helped fuel the drive for personal accounts as part of Social Security reform.
Topic:
Conflict Resolution, Security, Development, Economics, and Government
With President Bush's call for comprehensive Social Security reform bogged down in the morass of partisan politics, many reform advocates have suggested starting the process with smaller steps. Recently, Sen. Jim DeMint (R-SC), Rep. Jim McCrery (R-LA), Rep. Paul Ryan (R-WI), Rep. Sam Johnson (R-TX), and others have proposed legislation to rebate Social Security surpluses to workers in the form of contributions to personal accounts.