It will not do what Americans truly desire, but it has been well thought, and could be an acceptable alternative--which is it's basic problem. It could achieve sufficient support to be adopted. Any Author must base his opposition to such a Plan on concrete realisms, and so on to the presentation.
The first major element stands as the $10.4 trillion liability of the Social Security Trust Fund. Kotlikoff would fund this by eliminating the Employee contribution currently made with the FICA tax, while retaining the Employer half of the contribution. He would instead apply a Sales Tax. It ignores the reality that the tax on Consumption would reduce Consumer Demand significantly, thereby reducing Business Profits, Employment ratios, and all Household incomes. The second major hazard lies in the fact that Businesses and Corporations possess the majority of lobbys in Washington, and the equal contribution of both Employees and Employers forestalls pressure to eliminate such taxation.
The second major element from with the Kotlikoff plan is desire to negate the primary purpose of Social Security in the first place: maintaining a adequate lifestyle for the Elderly. He would cut Benefits for All to a miserly slightly-above starvation payment, rather than taking on the very real issue of 'Means-Testing', where monthly Benefits are phased out by increasing Income levels.
The third failure in the Kotlikoff Plan comes in no restrictions to limit Medicare provision. He would let the health care industry continue to set health care costs to their benefit--not Patients. His Plan does not propose a yearly limit to Medicare benefits--this Author suggests $30,000 per Patient per year, not counting Pain-killers, machine procedures costs, and hospice care cost. lgl
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