INCREASING SECURITY

December 1998
		How can we reform Social Security? Should the government invest Social Security into the stock market to obtain higher returns? Should individuals be able to invest their Social Security contributions in individual accounts? Experts answer your questions.

Would individual accounts have a safety net? What about women and minorities? What is SSI? Would CalPERS work on a national level? Should we eliminate Social Security?   More Social Security coverage White House Conference on Social Security Urban Institute Preamble Center CATO Institute Social Security Administration Browse the NewsHour's Health Spotlight	Lawmakers and experts have agreed that the government needs to reform Social Security to avert a potential long-term deficit in the program. According to the most recent projections, around 2013 taxes paid into Social Security will no longer cover the cost of checks being paid out. At this point, the agency will have to draw on government IOU's to pay benefits. Around 2032, once Social Security has drawn on its entire stock of these reserves, annual taxes paid into the program may only be sufficient to pay 72 cents of every dollar of benefits. At a recent conference on Social Security at the White House, experts and politicians addressed the need to change the program. The options: raising payroll taxes; cutting the projected growth of benefits; raising the rate of return earned on Social Security funds; or some combination of these. Raising the rate of return, lawmakers and experts agree, is the least painful option. In addition, many, reformers would like to see something more "like a conventional pension program where you collect money in advance, invest it, and reserve it for the future," explained Susan Dentzer, Health correspondent for the NewsHour with Jim Lehrer. One popular option would be to allow people to invest a portion of their Social Security contributions in their own accounts, much like a 401(k) or an Individual Retirement Account (IRA). Others suggest the government should invest a portion of Social Security's reserves in stocks to get a better rate of return. What are the most viable options for reform? How can there be a higher rate of return without risking too much? Are there some options that would be better for one population over another? Rudolph Penner, Senior Fellow at the Urban Institute, Dean Baker, Senior Research Fellow at the Preamble Center and the Century Foundation and Michael Tanner and Darcy Olsen at the CATO Institute, answer your questions.