THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Tuesday, October 3, 1995 TAG: 9510030005
SECTION: FRONT PAGE: A12 EDITION: FINAL
TYPE: Letter
LENGTH: Short : 47 lines
When are our elected officials in Washington going to wake up and realize that the working people in this country demand that our Social Security system be overhauled? According to a recent study by the Washington, D.C.-based Cato Institute, unfunded pension Social Security liabilities now amount to about $12 trillion. That means that our national debt is now around $17 trillion (which includes the national debt of $5 trillion).
I have come to realize in working over the past 15 years that Social Security is not a benefit but another tax to me and many other working folks and employers. Karl Borden, a professor of financial economics at the University of Nebraska, has even proposed that workers under age 47 be allowed to forgo the right to Social Security and invest their 12.4 percent tax (employee and employer taxes combined) into a private retirement fund. Chances are pretty good that the workers who opt out of the system would earn a much higher return than what Social Security could ever offer. Borden estimates that the U.S. government would save more than $6 trillion if younger workers were allowed to go to a private system.
Since the mid-1960s, Social Security has helped to fund the federal deficit, thereby leaving the original trust fund with a lot of IOUs and not allowing any trust funds to be invested in productive assets and investments. According to the Cato Institute, ``Social Security has been a horrifically bad investment for Americans.'' Had the trust funds been properly invested years ago, the annual return to many Americans would have been far more generous than today's average 8 percent, according to Cato.
Under the current system, where is my actuarial statement? It is obvious that there exists no proper accounting to any individual, even with the unfunded liabilities. No business today, not even a Fortune 500 company, could deem not to show the unfunded liabilities like that of Uncle Sam's $12 trillion.
It is time that the people in Washington do something, for the unfunded pension liabilities get worse each day as new workers enter our system.
Do you suppose Uncle Sam might renege?
R. STEVEN JORDAN
Suffolk, Sept. 27, 1995 by CNB