As I pointed out in my blog post about Entitlement Spending, the Social Security and Medicare trust fund has over $100 trillion in unfunded liabilities. How will Washington pay for this or make up the shortfall? Tax increases are an obvious solution, reducing benefits will have to be part of the equation. What other options exist?
One option would be to take the suggestion of the Service Employees International Union (SEIU) that wants to centralize all retirement plans for American workers, including private 401(k) plans, under one new retirement system for the United States. They will call it Retirement USA and they actually have a website.
The SEIU suggests this plan would provide universal security and adequate income for future retirees. This pool of assets – yours, mine, everyone else’s, and the unfunded liability of social security would be professionally managed.
When I watch our government take over car companies, financial institutions, health care, and now maybe add our retirement accounts, I ask the question: have we left capitalism and are we zooming right past socialism? If you have reached the age of 59 ½ is now the time to maybe draw down your retirement account?
What happened to personal freedom and personal responsibility? I would love to hear your comments on this one.