Dynamic Private Accounts: A Sustainable Solution to Social Security Insolvency

Abstract

The ability of the Social Security system to support future retirement benefits for all Americans is rapidly withering away. Suggested fixes tend to center in on higher taxes or cuts in benefits. Both have been tried and neither has worked. Retirement security can only be secured when Social Security is fully privatized. A privatization plan requires a slow, continuous transition from today's all-government model to one based entirely on private accounts. This paper explains how that transition can take place without jeopardizing the benefits of current enrollees.

Keywords: Social Security, Privatization, Welfare State, Economic Freedom

JEL Classification: D31, D63, D91, H40, H55