Social Security Retirement Income Program: Reform vs. Privatize

Abstract

This paper compares recommended reforms to improve the Social Security retirement income program to the expected benefits of privatizing it. The research method is primarily theoretical, applying fundamental principles of finance and economics to analyze and evaluate each alternative. However, enough empirical data is also provided to test the author’s arguments and conclusions. The most important conclusion is that partial privatization would be better than the other recommended reforms, but a fully-funded and totally privatized program would be best, financially and economically for society. However, given government policymakers’ lack of political will to privatize the program, it’s most likely that they will continue to reform it in ways to make it more financially sustainable. The paper primarily adds to the existing literature by providing a strong theoretical and empirical argument for privatizing the Social Security retirement income program, rather than continuing to reform it.