The Perils of Privatization

Social Security Privatization Cuts Lifetime Benefits; Makes Senior Citizens Vulnerable to Poverty

By Eric Lotke, Institute for America's Future
August 04th, 2008

An idea to radically change Social Security that has already been soundly rejected by the American people—privatization—is being resurrected. If its proponents succeed, 8.6 million older Americans would lose a safety net that keeps them from falling into poverty, according to research released by the Institute for America's Future.

Three years ago, President Bush declared that Social Security faced a financial crisis, and his solution was privatization — taking payroll taxes we all pay into the system and investing a portion of those funds in private stock market accounts.