Should Social Security in the U.S Be Privatized?

[Puppyroach]

starcraft said:

Puppyroach said:

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.

You have misunderstood. It is not government funded. Employers are required to pay the 9.5% super contribution. When super was introduced, the nation endured a quick, one-off drop in income (as the extra 9.5% was factored out of pay-packets). All of the contributions are paid by private contributions from companies, with optional additions from employees that are favourably taxed. Until recently the government matched a small amount of additional contributions but this has been/is being phased out.

The government mandates that this happens, but it is virtually all private money. And it scarcely falls afoul of civil liberties, as you can manage your superannuation balance yourself if you like.

You just gave the very definition of a tax :). This is usually political semantics in order to cater to cetrain demographics. But just as the US Supreme court concluded regarding the ACA (where emplyers are required to pay into the system), it is a matter of taxation since the purpose is to fund a public system through mandatory payments under the threat of punishment if you do not fulfill you payments. It doesn´t matter if the government are the ones managing the funding in the end, the government are the ones doing the taxation.