One idea might be to simply buy T-bills with them. At least T-bills have a rate of return.
I think if you coupled this with privatization it would be hard for the Donkeys to argue that there was some larger risk to Social Security. Only if you think FedGov will default on bonds.
Then, at age 65 - you could convert it to an annuity (again, one option would be government run), or move it to private funds, or spend the principle. (Possibly with some maximum per year.)
This eliminate all the people gaming the system who work just enough years to get the minimum at the end of their productive years and get a much higher rate of return than the diligent 50 year contributors (which I will be when I retire)
Right now it is 1/2 a retirement system and 1/2 Yet Another Wealth Transfer System.
Found a bit of a mistake here:
"Still, it would be best if our funds did achieve optimal growth, so that people in their 30s today, have to pay in so retired folks can be paid right now."
Meant to say, "Still, it would be best if our funds did achieve optimal growth, so that people in their 30s today, would not have to pay in so retired folks can be paid right now."
Meant down the road a bit, but I think you'll catch my drift.
It bothers me to see one person have to pay in so another can live off their income.