The Solution

To fix the problems of Social Security you must first understand what those problems are. So, if you have not done so already, read “The Problem” then come back here to read the solution.

Ok, so you’ve read “The Problem” and now have a better understanding of why raising taxes, reducing benefits has not worked in the past, will not work now and will ultimately exacerbate the problem requiring continued tax increases and benefit cuts in the future until there is nothing left to fix.

The problems of Social Security are symptomatic of an ailing economy. Raising taxes and/or reducing benefits takes money out of an already weak economy. Tax increases place additional financial burdens upon workers and employers alike; benefit reductions (if done across the board) hurt seniors, disabled and surviving dependents of deceased workers, depriving them of benefits already paid for leaving them with less spendable income.

Taking money out of an already weak economy is exactly opposite of what we need to do to fix the economy…the real underlying problem.

So what about privatizing the system? This would definitely be a big boon for Wall Street and the investment banks, but devastating to the financial future of every American! First, even a graduated or phased in plan would divert tax receipts from the current system that are now already insufficient to meet the current benefit payments.

Further, from a financial planning perspective, it would destroy the foundation of a successful financial plan. Since its beginning, the guaranty of Social Security’s predetermined benefits has served as a foundation to virtually every American worker and enabled them to use more aggressive investments within personal savings…investments with risks that otherwise (without Social Security’s guaranteed benefits) would not be prudent.

Additionally, contrary to the belief of most Americans there is not a private retirement plan in America (that I am aware of) that would out produce the benefits of Social Security current guaranteed benefits on a dollar-for-dollar contribution and benefit-for-benefit basis. People who think that they can get better returns in an investment account forget that Social Security is not just a retirement plan; Social Security provides a death benefit (life insurance), disability benefits and income to surviving dependents in addition to retirement benefits. If you put the same amount of money that you pay into Social Security into a private investment account and purchase private insurance benefits that duplicate all of the benefits of Social Security you would have little, if anything, left to invest for retirement!

In fact, financial reports found on the Internal Revenue Service website show that the average income provided current retirees from private pensions, 401k and IRAs are all less than the average Social Security income of current recipients…and most of these plans now paying benefits had no life insurance, disability insurance or guaranteed dependent income benefits.

So what is the SOLUTION? Ironically, the solution to the problem is Social Security itself!

Social Security was developed to be part of the solution to the greatest economic problem the United States has ever seen…The Great Depression. The rest of that solution involved putting Americans back to work…The Great Works Projects.

Not only did these programs help restore health to the American economy, it improved the quality of life for every American. These projects resulted in more affordable and dependable power, water, sanitation and highway systems.

They created the infrastructure necessary to attract and support the development of businesses that created jobs. Those jobs led to the development of more businesses and growing communities to house and support the workers.

History often repeats itself; today we find ourselves again in economic strife…the worst since the Great Depression and so severe it has been dubbed the Great Recession. So why not take a page out of history and restore the economy by restoring America.

Let’s use the reserve funds of Social Security to rebuild American and put Americans back to work in the process. Putting America back to work will stimulate every facet of the economy and with a healthy economy tax receipts will increase. Greater tax receipts will provide the means to begin paying down our national deficit.

Additionally, with American’s working the employment tax receipts will go back up above the amount necessary to meet the benefit payments and create excess to continue the process.

It’s not the stock market that Social Security needs to be investing in…It’s America.

Much of our economic problems exist because too many of the companies listed on Wall Street shut their factories, service facilities and moved them oversees. Why should American workers be investing in companies that refuse to invest in them? It makes no sense at all.

But, if we invest in America and rebuild our infrastructure they (the companies) will be forced to hire Americans to do the work. And, if we place requirements upon them to use American made products they will be forced to bring manufacturing back to America.

I can think of no greater risk to our national security than a decaying infrastructure and our inability to produce the goods and services we need…when you become dependent on others you will lose your independence. I don’t know about you, but I am not willing to give up my independence and the civil liberties our forefathers died to give us.

Under President’s Bush and Obama we spent over three trillion dollars bailing out banks, investment companies and the auto industry; and extending unemployment benefits. While some jobs may have been saved, millions more were lost.

Despite all the money spent we still find ourselves in the midst of a recession. Some would argue that all we have really done is bury ourselves in debt and devalue our dollar in the process…so much so, that much of the world is now questioning the future of the dollar as a viable reserve currency.

President Obama proposed another 60 billion be spent on job creation and has been unable to get Congress to do so…largely because doing so will further devalue the dollar and increase our national debt.

Creating jobs is the right thing to do…it’s vital to restoring a healthy economy. However, 60 billion, while it sounds like a huge number to most of us, it is a drop in the bucket compared to what is needed.

Under the plan outline in Saving Social Security – A Commonsense Solution I show how create jobs with 50 times the amount proposed by President Obama…nearly 3 trillion dollars; and how it can be done without increasing the federal debt by one penny!

Join me, please download your copy of Saving Social Security – A Commonsense Solution and write your congressional representatives in support…let’s rebuild America!