If you make the changes you suggest, then there would still be large parts of the program that will need to be funded somehow.

(I'm too lazy to look this up at the moment, so I welcome corrections.)

Initially, Social Security was an old age and survivor's benefit to keep people from living in poverty after they retire. In that, it's been quite successful. The elderly make up a much smaller percentage of people in poverty than in the pre-SS days.

As you point out, the initial age for retirement benefits was 65 when the average life expectancy was less than 60 (IIRC).

People living longer, and retiring at 62 (and getting partial benefits) or 65 (or 67+ for people like me) is putting stress on the system.

In addition, SS was expanded to pay benefits to people with certain disabilities - "Supplemental Security Income". Even children can get these benefits. Etc.

So lots of things are going on.

SS was never intended to be an investment - at least not the way it was set up (though it may have been sold that way at times over the years). It's a tax that most of us pay so that the elderly won't live in poverty. And so that others will have certain benefits.

And in the 1970's cost-of-living adjustments were made automatic rather than requiring a vote of Congress. This added huge costs to the system (just as inflation was high) without any pressure on Congress to increase taxes to pay for it.

I don't think that SS should be structured so that people should be guaranteed to get all their taxes back with interest. I do think that the taxes should be restructured. For instance, I don't agree with the income cutoff (i.e. I think all income should be subject to SS taxes, not just that below 75k or whatever it is now). I think that retirees should be subject to reasonable taxes so that those who are well off should pay a reasonable amount in income and SS taxes. And I agree that the SS taxes for those self-employed, private contractors, post-docs, sole-proprietors, etc., are ruinous and should be restructured.

I think lump-sum distributions would be disasterous even if the money could be found. People would assume that it was a lottery winning and that there'd be pressure on the system to pay them when that money's gone. "We don't want millions of people on SS losing their homes and living in cardboard boxes! We've got to do something!"

Similarly, I think if the US wants to continue to have the benefit of older people not living in poverty, then I think there has to be some general tax to pay for it. Having SS be solely an individual account wouldn't guarantee that benefit, IMO.

I don't think anything about SS nor Medicare is going to change, even for the better, until younger people start voting in greater numbers. As you say, politicians pander to them because they vote in such great numbers. :-(

My $0.02.

Cheers,
Scott.