Marcus, your question about government pensions is valid, and I don't think it's been answered yet.
What we call Social Security is a payment from the government once we retire. The size of the payment depends on how long we've paid into the system (unless one gets in on a free political pass), how much money we make on our investments and savings and other retirement programs, whether we're married, if we're disabled, and so forth. That money comes from each taxpayer, goes into a common fund (which is usually raided by Congress - whole other story), and is paid out on a monthly basis.
The 401(k) funds Roger referred to earlier are completely separate from Social Security. A person with a 401(k) voluntarily pays into the fund and the employer usually matches a portion of that payment. The money is invested in one or more mutual funds or savings programs or bond funds or other financial vehicles, and the person who is paying in chooses where the money goes. This gives the individual a great deal of latitude in his or her retirement investments.
The most attractive part of the 401(k) program is that the contributions are not taxed. This means that if I contribute five hundred dollars to my 401(k), the Federal and state governments do not take taxes out of that money. They will tax it when the individual takes it as income after retirement, but by that point the retiree is usually living on a lower income, and therefore would pay less in taxes then than at the point when the money is actually earned.
If Congress takes over this program, the management of my money will end up in their hands, not mine. I will have little if any choice over where the money is invested and how much return I can generate over the years. And that means that my taxes will go up and my retirement nest egg will shrink because I won't be able to afford to sock that much money away.
The worst part, to me, is that it would break an implicit contract that Congress made with American workers when the program was first implemented. They don't tax my retirement savings now, and I'll save more. It has, for the most part, worked out well, despite a number of negative experiences by individuals. This program was never meant to guarantee anyone a rich retirement. It was set up to give each person some leeway in building for that retirement.
