let’s say you actually wanted such a system to work. it could, but only for those that actually worked. also, the money collected would have to be placed in actual investment portfolios that have a chance of making something for a return. also, anything paid in should be treated as portion of a private portfolio, meaning it would be part of the person’s estate upon death. this would also allow it to roll over as any investment should (if death taxes didn’t exist).
if families were encouraged to form groups (like the old fashion concept of ‘a house’ with relatives and close friends) then a portion of those accounts from people that died early (or died before it was gone) could be donated and invested. over time, those group accounts would grow and become financially stable, allowing families the ability to cover their own financial issues
The problem is the transition. There are a lot of people collecting benefits, or will be collecting benefits soon. You can't expect them to accept nothing after paying taxes all this time.
So, you'll have to collect taxes for a while from people that will never get any benefits, and they will have to do that on top of contributing to their own investment portfolio.
As you noted -- albeit for the wrong reasons -- almost all the money previously contributed is gone, paid to our parents and grandparents. We can't just print that money.. we are already dangerously close to the edge. So, there has to be a shared sacrifice.
I'm close to retirement. I figure I would have about $1M right now if I had just invested the contributions on my behalf into long-term Treasury bonds (that's not an estimate -- I've actually done the calculations). But, I'm willing to give up some of my benefits, in exchange for a transition to a privatized system. I'll do so, because it would mean my daughter won't have to pay punitive payroll taxes so I'd get my full check every month.
But, I'm not holding out hope. So, I'm planning for a 23% reduction in my Social Security benefits in 2034, and will adjust accordingly if that date comes earlier or the reduction is higher. The Social Security warns of this every year, but it falls on deaf ears. I'm heeding their warning.