I don't know about vouchers. I'm sure it would work fine in middle class neighborhoods, and mean death to schools in say, West Baltimore (just finished the last season of The Wire - great show). Unfortunately I think the system needs people to pay more for the people who can't pay at all. Some of those people who had no money will take that education and end up being the people to pay more later. Take away all the people who pay more and there's no way that school is getting better when all they have is the poor kids with no parents. No I'm inclined to try to figure out a way to fix the system incrementally.
Social Security differs from Madoff BECAUSE we are forced to pay into it. The government can lower benefits or raise taxes, Madoff can't create something out of nothing. Also Social Security isn't really an investment vehicle at all, it's a tax that's spent immediately on today's old people so it's kind of silly to calculate a return on it. The government is quite open about this, whereas Madoff wasn't.
I disagree that regulators cause all the problems - yes, usually the regulators are always late to the party, and a lot of regulations don't seem to make sense because they were knee jerk reactions. But we also haven't had another Depression since the 30s. Laissez-faire capitalism was characterized by regular bubble and bust - huge depression style busts every 13- 15 years because of over-exuberance and then overreaction. I'm inclined to go with a compromise on this one and will sacrifice part of the bubble for a little softer landing in the bust. I'll be the first to complain about OVERregulation, but not regulation as a whole. I'd never put my 6 months of expenses emergency fund in a non FDIC insured bank, would you?
If Social Security WERE an investment, it might be part of a lot of people's portfolios. It is a very low risk, inflation indexed investment like TIPS which people buy all the time. But again, it only "works" BECAUSE we are forced to pay into it, not that we get to opt out. The fact that we have members of a giant population boom reaching retirement, and they decided not to have a lot of kids is kind of an anomaly that I don't think it indicates a completely broken system. We should import a million doctors and it would go a long way toward fixing two problems
A lot of people wouldn't have paid for the Iraq war, either. Should we give them the option of opting out of paying for the war? Wouldn't really work would it? It's kind of an everyone or no one deal. Social Security isn't for YOUR benefit as a payer, it's for the old folks that are receiving your money NOW. Someone deemed it necessary to not have a lot of old broke folks littering the streets and that everyone should be involved in paying for it. You should count yourself lucky that we live in the least generous Social Security country and be glad the idea of expanding benefits seems ludicrous in our present situation.