It's very clear you don't know, because if you did, you would understand why your argument is so foolish. Believe it or not, it's possible to have plans that invest in the stock market without investing everything in individual stocks. If SS had invested part of its money in an index fund, it wouldn't be facing the problems it is now.
if you account for inflation and combined annualized growth, the average return of the S&P 500 from Jan 1 1948 to Dec 31 2009 was
7.23%. play with the dates to put us in a Post-Reagan-Era tax world (1982), and the rate jumps to 7.98.
Now, according to that Great God Of Sources (Wikipedia), the median income for an American household in 2006 was a little over 50K. Because cpwill is lazy, for the purpose of this figuring, we are going to assume that the workers involved will earn median income their entire life, though in reality they will start off earning less and end up earning more.
the FICA contribution is 7.65%, which out of $50,000 is $3,825. $3,825 broken down into months is $318.75. If you were to start bringing that income in (we'll cheat up and say everyone finishes) after you finish college, at age 22, and work until you are 65 (though we all know it's about to go up to 67), investing $318.75 every month with an annual return of 7.98%, then you will retire with an account worth $1,353,432.
IN TODAY'S MONEY. placing that into an extremely conservative account (hell, an annuity) that can generate around 5% interest a year gives you an annual income (again, in todays money) of $67,671 and 60 cents. broken down, again, into monthly payments that comes out to a monthly benefit of $5,639.30; the average social security monthly benefit for a retired worker (by comparison) is
$1,164.
incidentally; if the retirement age rises to 67, then that 5600 bucks a month rises to 6600 bucks a month
.
i'm only sayin'. privatize the damn thing already.
