Private accounts solve retirement shortfalls

(Star, “How Private Ownership Could Provide Real Social Security,” pg online @ https://www.dailysignal.com/2019/08/02/how-private-ownership-could-provide-real-social-security/ //um-ef)

There is a way out of the darkness, but it takes principles and courage. Low-income America isn’t suffering because of insufficient government dependence but because of insufficient independence—ownership. And here we can use government policy to make things better. Per the Urban Institute, the average savings in retirement accounts in 2016 was $157,884 in white households and $25,212 in black households. Black families, according to the report, “have less access to retirement savings, vehicles, and lower participation when they have access.” The headline in a recent Wall Street Journal column reads: “Counter Inequality With Private Social Security Accounts.” The authors, Jeff Yass and Stephen Moore, propose Own America Accounts, private retirement accounts to where workers could shift 10% of their paycheck from Social Security. The average annual return on Social Security over the last 40 years has been about 1% per year, according to Yass and Moore, and stocks returned 6% per year. With Own America Accounts, an average American could have retired in 2016 with between $1 and 2 million in savings over a 40- to 45-year working life, per Yass and Moore. Furthermore, Social Security is yet another dysfunctional government program. Social Security trustees project that in just 16 years, there will be insufficient funds to meets obligations. So a bad deal will get even worse when our politicians try to “save the system” by raising taxes, raising the retirement age or cutting benefits. At minimum, make Own America Accounts available to low-income Americans, and help them build wealth through ownership rather than more government dependence.