Monday, January 31, 2005

Private Parts

When people push the privatization of Social Security they are failing to provide the details. Now, most people don't care about the details, even though the say they want to know them. When they start to hear about COLA's, administrative policy, and PIA's their eyes start to roll back into their head.

Even with that in mind I have a laundry list of unanswered questions, problems, and issues that would have to be answered, solved, and addressed before any private accounts were established.
  1. Who is eligible for a private account? What will be the cut off age?
  2. What percent of individual's contributions will be eligible for contribution?
  3. Will the tax status of the private account be on a Pre-Tax or After-Tax basis?
  4. If it will be Pre-Tax, that creates a tax cut, how will the massive loss in revenues be made up?
  5. If it will be After-Tax, will that point be made known when this is made to look like a 401K Plan?
  6. Who will administer these accounts? Employers? The government? Are Individuals forced to go to a Financial Institution on their own?
  7. Who pays the administration fees?
  8. Are administration fees included in Bush's Plan?
  9. What investments can be included? Private Funds? Stocks, bonds, options, futures, commodities? Anything? Who Decides what a person can invest in?
  10. Who manages those investments? Are they owned directly or in a mutual type fund?
  11. Who pays the brokerage fees? Are they straight fees or discounted?
  12. If these are collectively owned in mutual type fund, who does the accounting?
  13. If the private accounts are use, who then who votes the proxies?
  14. Will lump sum distributions now be allowed?
  15. Will beneficiary benefits continued to be offered.
  16. How will beneficiary, minor dependent, disability, and death benefits be funded?
  17. Does Bush's plan cap the level of earnings on private accounts to pay for existing and future "traditional" benefits?
  18. Is Bush using the "Cash Balance" type of retirement plan as his basis for this? Those type of Plans have not yet received favorable determination letters from the IRS.
I could on and on with questions that are not being asked by the media and not by politicians. This issues should be debated in public, and not just on CSPAN. CNN, FOX, MSNBC, PBS, talk radio, and we in the blogosphere should be discussing the details and understand it BEFORE a lobbyist writes the bill and passes it around an hour before the final vote.

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