Finely, a candidate has shown the courage to call Social Security exactly what it is: disgraceful.  Now this issue can once again become part of the national debate and help propel John Sidney McCain to his rightful place as leader of the Fee World.  The problem is complicated beyond the understanding of non-economists and non-Presidential candidates, but let me break it down to the basics.

The problem: people get old and stop working, but don’t stop spending money.

Old (disgraceful) thinking: the government collects money through a payroll tax to put into a common account.  When someone retires, that person draws on the account based on how much he/she contributed over time.

New (graceful) thinking: a private, for-profit, non-government company collects money through a payroll tax to put into a common account minus expenses.  When someone retires, that person draws on the account based on how much he/she contributed over time minus handling fees.

The old, disgraceful method has no easy mechanism for adjusting the amount of monies coming in without raising taxes.  Raising taxes is un-American (don’t let the flag pins those IRS folks are wearing fool you).

The advantage of turning over management of retirement plans to private, for-profit, non-government companies is something we economists like to call “fine print”.  A private, for-profit, non-government company can manage retirement accounts exactly the way they manage credit cards.  We all have credit cards and we’ve all seen the television advertisements that demonstrate how much more smoothly everything runs when we all use them.  A privatized retirement system would be just like that.