WASHINGTON – Social Security is running out of money. Beneficiaries’ financial returns are abysmal. Congress controls every retirees’ future. Why would anyone oppose creating private retirement accounts? Because private accounts would transfer power to individuals and families from lawmakers and interest groups. Opponents of President George W. Bush’s initiative are afraid that it would work too well, putting them out of business. If Social Security was offered by a private company, the executives would end up in jail for pushing a classic Ponzi scheme. The government collects money from today’s workers to pay today’s retirees. The scheme worked so long as there were enough workers — almost 17 in the 1950s, for instance — for every retiree. But the ratio of workers to retirees is rapidly heading toward two. At the same time Americans are living longer, and thus collecting far more in benefits. When Social Security was created nearly half of people died before collecting a check. As the demographics shifted, so did the economics. The early tax levies were low but have sharply escalated as ever fewer workers have had to support ever more retirees. Many beneficiaries will actually lose money. System revenues are set to go negative in little more than a decade. Alas, there is no trust fund to keep paying benefits until 2041, as claimed by system supporters: All Uncle Sam possesses is a file cabinet full of IOUs from one federal agency to another. These special issue Treasury bonds (which cannot be sold) have been termed an “accounting mechanism” by the Congressional Budget Office. With or without them, the government will have to drastically cut benefits, dramatically raise taxes, or significantly increase borrowing to keep sending out benefit checks. There ain’t no free lunch, as Social Security’s defenders seem to suppose. But the debate over numbers threatens to obscure the most important issue: giving people control over their own retirements. The AARP, apparently unconcerned about sparking a generational war as the tax burden on the young escalates ever skyward, got the issue precisely wrong when one of its hysterical direct-mail letters demanded: “No private accounts with Social Security dollars!” There are no Social Security dollars. There are only Americans’ dollars. Because Americans are paying into Social Security, they should control the use of those dollars. And they should actually own them, in contrast to today, when their benefits vanish if they die prematurely — or Congress decides to take them away. No surprise, individuals are more responsible guardians of their own interest than is Congress. Indeed, given the personal scandals, institutional misbehavior, and irresponsible spending endemic to Capitol Hill, who could believe otherwise? One can legitimately argue about the design of a reform package, the size of the accounts, and the speed of the transition. But the worst thing to do is to maintain the status quo — or reinforce it by hiking taxes, pouring more money into a system doomed to actuarial failure. Opponents of personal accounts argue that the “transition costs” of letting people control their own retirement futures are too high. True, it isn’t easy to maintain current benefits while allowing future retirees to put at least some of their current taxes into private accounts. But doing nothing entails its own costs. About $12 trillion worth. That’s the current estimate of Social Security’s unfunded liability. Private accounts simply turn some status quo costs into transition costs, while reducing the total. That’s a good deal by any measure. But grant the concern about the immediate future. How to finance the transition in the short term? Cut unnecessary government spending on the rich. Not, mind you, raise taxes. Rather, Congress should slash outlays. My Cato Institute colleague Stephen Slivinski estimates that corporate welfare runs about $90 billion annually. There’s never been a good justification for forcing average taxpayers to enrich Boeing Co. and McDonald’s Corp. and Archer Daniels Midland Co. and the multitude of other firms on the federal dole. The federal budget offers a target-rich environment. There are the Export-Import Bank and Overseas Private Investment Corp. There are subsidies for the agriculture and maritime industries. There are automobile, energy, and technology research payments. There is an endless stream of grants and loans to other businesses in a variety of guises. These programs should be cut on their merits. But ensuring that Americans regain control over their retirement destinies offers another good reason to act. Countries the world over are struggling with pension systems that face collapse as more people live longer. Only bold reform, allowing Americans to control more of their own Social Security dollars, will avoid a national retirement catastrophe.