Negative Effects of Privatizing Social Security

Bush administrations continuous furiousness on the issue of privatization of social bail serve ups has generated much jade in the recent years. Many a social credentials scholars and role players compress into account its bad cause on the socio- heathen sector and economic subject field of United States rather than eulogizing it. They put forward many negative effects of this privatization of social security. One of the prime negative effects is that a arranging that is carved out to offer benefits to employees and their kin upon retirement, disability, or bereavement is going away to be distributeed like a commodity.It is a public service and is not a commercial service. From the very start of social security system in 1935, the program was based on the basis dominion that magnitude of the remuneration package would depend on the income of employees over their professed(prenominal) time span. Contrary to this, Bush administrations new privatized security system would t ake into account the amount of funds that a worker would invest in his or her own personal account. Ultimately, this will disappoint the magnitude of benefit and there would be a great unbelief on the part of the workers about their investments, margin over investments and remuneration. This would not further result into socio-economic maladies for their but psychological and mental health of the workers would be in danger too.Some scholars be of the view that Rate of return calculations, do by the proponents of privatized social security overlook the value of accessible protective coverings insurance protections. So privatization of favorable Security would divert the money that is currently utilize to finance existing insurance program into investment accounts (this proposed to be created for each(prenominal) worker). So from what sources this amount, that is being used to carry on current payments to recipients of a variety of Social Security insurance and other benefi ts, will be collected?It would generate a cause and effect phenomenon. For example exchequer of States have to borrow huge amounts from the private sectors and other financial institutes like a shot in order to pay the insurance and other retirement benefits to the already retired and/or their families. This would cause negative impact on the national thriftiness and federal deficit would go up. National saving would decline and it will effect the long-tern economic development.Another negative impact of the privatization of social security is that remuneration on the finances of workers through individual accounts would be alone dependent on the market trends. Furthermore scholars argue that individual investors are more prone to perform badly in the market than bodied investments. In the above case brokerage houses, banks and mutual funds would be beneficial.Social Security programs does not take into account the gender differences and its patterns and procedures treat men and women on equal terms, But is a biological and cultural truth that women get the worst provided by the social security. So in this way, she will be the most hard-hit in the privatization process of social security. Caroll L. Estes as early as 2004 take into consideration the negative impact of privatization of Social security and saysNegative effects are particularly harsh for those sometime(a) women who do not conform to the model of family status as hook up with with male breadwinner and for those already disadvantaged by race, ethnicity, and class. (Estes, 2004)ReferencesAnrig Grig, Jr., Wasow, Bernard. Twelve Reasons Why Privatizing Social Security is aBad Idea. The Century Foundation. 2004. Available onlinehttp//www.socsec.org/publications.asp?pubid=503Estes, Caroll L. Social Security privatization and older women A feminist politicaleconomy perspective. Journal of maturation Studies. Vol.18. No. February 2004,Pages 9-26Feldstein, Martin. Privatizing Social Security. Journal of Economic Literature, Vol. 37,No. 2 (Jun., 1999), pp. 685-686