Fix Social Security

I have a feeling this Blog is becoming the R L Rutherford Blog rather than the RF Rutherford Family Blog. That was not my original intent but it is moving that way. I have attached a letter I recently sent to my Senators and Representative with copies to the President and Vice President.

Senator John McCain (R):
Senator Jon Kyl (R):
Representative Jim Kolbe (R - Arizona District 8):
President George W. Bush:
Vice President Richard Cheney:

Subject: Social Security
Richard L. Rutherford
18267 S Via Del Minero
Vail, AZ 85641

Dear Sirs:
I am contacting my members of Congress regarding an issue of concern to me. I am very concerned about what the partial privatization of SS will do to the nation.

There are several ways to fix SS without private accounts. Greenspan's committee under President Reagan in the 1980's did it by raising taxes and raising the tax ceiling. Something very similar can be done now. In my local paper and several national publications I have seen many proposals that will work. Among these are:

- Raise the cap on taxable earnings (Make this adjustable based on inflation)

- Increase the SS tax rate. I like this the least.

- Raise income taxes on benefits (use a sliding scale based on adjusted gross income so that the more income you make the more of your SS income is taxable). Use a progressive approach.

- Preserve taxes on estates over a set amount say (10 million). Adjust this ceiling based upon inflation.

- Extent coverage to new state & local employees. I think this is questionable.

- Invest a portion of trust funds in indexed funds. I also think this is questionable. Currently the government spends all of the money collected and writes a note to SS.

One or more of these together would fix the SS trust fund.

If you still want private accounts allow individuals to set aside a portion of their income in private accounts that will supplement their SS but are in addition to their SS. Let the government collect and administer these accounts. These would be like IRA's but government collected and administered. There would be a limit on how much and it would have to be decided when the proceeds would be taxable.

It’s a win win situation. SS stays the same with minor adjustments for solvency and Individuals get private accounts via payroll deduction. Funds flow through normal tax channels into government channels or into administrative accounts. It's a government 401K on top of SS.

Sincerely,
Richard L. Rutherford