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Puppyroach on 03 July 2015
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sc94597 said:
Puppyroach said:
It isn't really privatized social security though, is it? It's a system where the government forces the employees and employers to push money into private options in order to, hopefully, create growth of the social security system and pensions. It's a way for the government to fund private organizations through taxes, which is kind of despicable (and happens way to much throughout the world). If it was truly privatized, it would be funded through the people's own, freely given savings. The problem with government run social programs is not that they are run by the government, but that they are not protected from being manipulated in the budget process, and used to cover expenses in other areas.

It isn't voluntary, but it is private. The government forces employers to have an equivalent of a 401 k for the employees, regardless of the size. Consequently, this is taken out similarly to how social security is taken, as a payroll tax. 

Alternatively, Forbes came up with this option: 

"But if we won’t require firms to put away retirement money for employees, why not do the next best thing and make the ones that offer plans automatically enroll staffers unless the workers choose to opt out? Better still, require the plans to feature auto-escalation, so the percentage that employees save goes up each year.

We could get a lot more saving by opting people into retirement plans with the option to default out,” Schrager says."

Put how can it possibly be privatized when it is funded by the government through taxes? I know that line is very blurry a lot of the times but I find it fascinating that we in this day and age call systems where the government basically gives corporations social welfare "privatization". The reasons this system in Australia succeeds (not to sure it has, the article and graphs give way to little information) is because the government has taken the funding of the social security system out of the budget process in a way. It doesn't have to compete with funding of other public areas in the same way as before. The solution would instead to keep it within the government but secure it funding so that defence spending for example, doesn't cut into social security.