Social Security vs. the stock market
21 October 2004 - Las Vegas Review-Journal

Letter-writer Annette Bonder uses anecdotal evidence about her stock market returns to discredit any plan to reform the train wreck that is Social Security by allowing workers to provide for their own retirement. The specific point in time at which she invested would be considered by many would-be Warren Buffetts to be an unlucky time to invest, but only a short-term thinker would stop there.

The average, year-over-year return of the stock market as a whole (meaning index funds like the S&P 500 that mimic the overall market) is 11% per year - that’s the average, including all the ups and downs that the market has seen over its lifetime. One great example of this long-term growth is that an investment of $1,000 on October 23 1929, right before the crash, would have resulted in a value of over one million dollars 40 years later.

Social Security was never designed to make anyone rich (except maybe the federal bureaucrats "managing" it), but it certainly won’t be there at all to keep 29-year-old workers like me "out of poverty" in 40 years. Something must be done, and privatizing accounts will hurt a lot less now than the whole ponzi scheme collapsing under its own weight will hurt later.