A viable fix for Social Security

In David Gibson’s nicely thought-out Wednesday letter, he states, “No one seems to have any idea how to fix it (the looming Social Security crisis) other than cutting benefits.” But a third option exists in addition to increasing the tax rate or decreasing the program’s expenses by reducing benefits or delaying the retirement age. This option is a proposal called “Tomorrow’s Retirement for the U.S. Today Fund for America” (the T.R.U.S.T Fund for America).

The plan involves a gradual migration from the current system to an option wherein the government sets aside “$7,000 in an individual account for each of the approximately 4 million children born in the United States each year. The money is placed into an investment portfolio determined by a blue-ribbon panel appointed by the president and Congress. In 35 years, the government receives back its initial outlay, which is used to fund the program for children born during the second 35-year cycle.”

The proposal was originated by Edelman Financial Services CEO Ric Edelman.

Some of the biggest impediments to implementing any change or improvement to the current system are powerful lobbying groups (such as AARP) that wish to preserve the status quo benefits and the fear of retired senior citizens that their benefits “guaranteed by the U.S. government” will be taken away during their lifetimes. This proposal is being supported by the Bipartisan Policy Center, a D.C.-based organization that addresses various challenges facing the nation.

So there is a viable fix to the looming Social Security crisis. However, it will require voters to press their congressional representatives to bravely consider this and other viable proposals in the face of strong lobbying opposition. To not act on such proposals surely will result in the looming crisis becoming a reality sometime in the near future.