1. Privatizing our RetirementSOCIAL SECURITY

2. INTRODUCTION Social Security is in trouble and needsreformation 3. BACKGROUND OF SOCIAL SECURITY 1929 Stock Market Crashed 1935 Social Security Program Created underFDRs New Deal 4. HOW SOCIAL SECURITY WORKS Payroll Tax on every paycheck Impure public good 5. ELIGIBILITY Early Entitlement Age Full Benefits Age Requirements 6. CALCULATING BENEFITS AIME Index 7. ALTERNATIVE: PRIVATIZE Favored by Fiscal conservatives 8. BACKGROUND OF PRIVATIZING 1928: 119,000 policies 1933: 300,000 policies Has gained massive popularity 9. HOW DOES IT WORK? Buy an annuity from a private insurancecompany Pay a fixed rate and receive a benefit lateron 10. SUGGESTED CONTRIBUTION AMOUNTS FROMADVISORY COUNCIL 1.6% Plan 5.0% Plan 11. TWO PROPOSALS Maintain the Status Quo Privatize 12. BENEFITS OF THE STATUS QUO 60% of beneficiaries derive half of theirincome from the program while 60% derive90% of their income from the program 40% of its beneficiaries above the povertyline 13. NEGATIVES OF THE STATUS QUO Within the next 75 years, it has been estimated that theprogram will pay out $5.6 trillion more in benefits than itwill collect from workers By 2050, 35% of our working population will be over theage 65 and will soon be retiring There will not be as many workers supportingbeneficiaries People are living longer than they used to There is a lack of revenue into Social Security is thegrowth in wages slowing down dramatically in conjunctionwith the unemployment rate Estimated $15.1 trillion as an unfunded obligation fromSocial Security Ponzi Scheme Persona 14. STATUS QUO DISCRIMINATES AGAINST High income workers Same tax rate but contribute more and receive lessbecause of AIME Men Usually die earlier and wont receive as manybenefits as women Single person households Cannot collect the same as a married household Widows or widowers Ability to take over spouses benefits instead of yourown 15. BENEFITS OF PRIVATIZATION Create a considerable amount of businessfor private insurers Boost our economy Freedom 16. NEGATIVES OF PRIVATIZATION Charge any amount of money for a premium Leaves out the other beneficiaries from theprogram such as disability and survivors Time consuming process for consumers Administrative Feasibility 17. COMPARATIVE ANALYSISFactorsSocial Security PrivatizationAdministrative FeasibilityXPolitical Feasibility XSolvencyConsumer Freedom XEasy to UnderstandXFavors High Income XWorkersAnti-Ponzi Scheme 18. OPINION AND CONCLUSION Neither option is feasible Entertain more options