Following are some observations ...

December 21, 1998

Following are some observations on economic trends in America, and how they relate to the current discussion of Social Security's future, from Michael Tanner, the director of the Cato Project on Social Security Privatization:

"According to today's New York Times, The U.S national savings rate has declined to an all time low, with personal savings actually turning negative for the first time since the great depression. Many economists, including Harvard's Martin Feldstein, say that our current Social Security system is one reason for America's low savings rate. These economists believe that privatizing Social Security would lead to an increase in national savings, spurring new economic growth. In fact, Feldstein believes that privatizing Social Security would be worth $10-$20 trillion to the U.S. economy, permanently increasing U.S. GDP by 5 percent. Other observers suggest an even greater increase.

"Thus, privatizing Social Security would not just save an unsustainable system and provide a better and more secure retirement for millions of Americans, it would boost our econonomy, providing more jobs and higher wages for today's workers."

For more information, see Privatizing Social Security: The $10 Trillion Opportunity, by Martin Feldstein.

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