A Birthday Reminder: FDR Supported Personal Accounts for Social Security
As Social Security Turns 70, FreedomWorks Urges Congress to Implement Personal Retirement Accounts
Washington, D.C. - On January 17, 1935, President Franklin Delano Roosevelt explained that, “in the important field of security for old people, it seems necessary to adopt … voluntary contribution annuities by which individual initiative can increase the annual amounts received in old age.”
This week, as Social Security celebrates its 70th birthday, President Roosevelt’s vision of personal accounts should be adopted so that Social Security can last another 70 years and beyond. As of today, Social Security is projected to reach deficit levels in 2017 because it will pay out more than it receives. Voluntary Personal Retirement Accounts alleviate the program’s solvency problems because they hold real assets that offer compounding interest with higher returns, thus offsetting the government’s future liabilities.
Even President Roosevelt recognized the advantage of allowing workers the option of contributing hard earned tax dollars towards a voluntary personal retirement account. Personal Retirement Accounts allow all American workers the choice of owning a real asset, building a nest egg for retirement, and passing the account on to the next generation. This would especially benefit lower and middle income workers who consistently live in the same economic condition due to a lack of significant financial assets. To this end, personal account offset the disadvantages towards minorities, like African Americans who have a lower life expectancy. Under the current system, if one dies before reaching retirement age, benefits are severed. However, with a personal account, the asset is transferred to the next generation.
FreedomWorks Chairman and former House Majority Leader Dick Armey commented on Social Security’s 70th Birthday:
“FreedomWorks’ 700,000 members recognize the advantages of personal accounts and are mobilizing for the congressional debate this fall. This August they are attending congressional town halls and meeting with their Congressman to let them know they support voluntary Personal Retirement Accounts. In September, our top activists will be flown to Washington, DC to further advance the Congressional debate.”
“As Social Security celebrates its 70th birthday, Congress should honor the principle of creating voluntary personal retirement accounts. Voluntary personal accounts allow workers the positive benefits of ownership, inheritability, choice, and economic security.”
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