Election '08: What's Really at Stake? - Retirement Security - Safeguard Social Security or Privatize

John McCain is reviving the Bush administration's proposal for at least partially privatizing Social Security, and has been criticizing the way the system has worked for 70 years.  At a town hall meeting in Denver in July, McCain declared:  "Americans have got to understand that we are paying present-day retirees with the taxes paid by young workers in America today. That's a disgrace.  It's an absolute disgrace and it's got to be fixed."

Barack Obama is strongly opposed to privatization as well as McCain's suggestion to raise the eligibility age to 68.  "If we privatize Social Security, what will we tell retirees whose investments in the stock market went badly? We're sorry? Keep working? You're on your own?" Obama said.  

Instead, to keep the system solvent for the longterm, Obama is proposing raising the Social Security payroll tax for people who earn more than $250,000 a year. Citizens for Tax Justice says this would affect only 1 percent of the population. Currently, no one pays Social Security taxes on income above $102,000.

On other retirement issues, Obama supports bankruptcy reform to help safeguard pensions, offering matching fund incentives to help low- and middle-income workers save for retirement, and eliminating income taxes for seniors making less than $50,000 per year.