2005 Articles

Securing Social Security for the Future

Stiglitz, Joseph E.

The funding troubles of Social Security have been greatly exaggerated in an effort to push a privatization agenda. Privatization has laudable goals--increased choice and higher returns--but few would choose to risk their secure retirement income and unfortunately higher returns cannot be achieved without risk. Regrettably, if private accounts really do offer a lot of choices, many people who cannot afford to do so will unwittingly risk their incomes; and, in many cases, a combination of this risk and high transaction costs will consume what should be their core retirement income. When the government picks up the pieces, the funding troubles will be worse, not better.