Originally posted by DarthSkywalker0Depends on how it is administered. The 'Fair Tax' proposal for replacing income/payroll tax with sales tax and having a system of 'prebates' (credits for low earners), would produce a massive net-economic benefit which would likely do far more than equalize the benefits, because people would be paying small-zero tax straight out of their pocket except when they make purchases, and could still get some additional top-up down the line.
Well, of course, a GST is going to have less of an effect on GDP, but the effect will still be marked enough to at least equalize social security in terms of benefits. Also, changing the tax code does not change the fact that social security is a ticking time-bomb. And, I appreciate the concession, it was a very fun debate. Hope to clash heads on another thread. Don't worry, I will not be as lengthy.
https://www.thebalance.com/what-is-...-effect-3305765
Much higher GDP, domestic investment and consumption etc... Although that is a hypothetical idea and has some critics, as laid out in the above link. However, it could help preserve the more beneficial welfare in the form of cash transfers whilst giving everyone an extraordinary tax cut.
In terms of Social Security precisely, though, I think it would be better if it could be replaced with private saving after your elaboration and the long term difficulties in keeping Social Security . However I feel that you may need to have some sort of automatic enrolment scheme in place for employees. Getting people to save early would be crucial, but there would have to be some compulsion to force the habit considering that Social Security has probably changed attitudes towards saving which won't go away overnight. And you couldn't phase out Social Security too quickly unless you want to doom 30/40+ people who have been paying into it. That would be unfair.