To Fix Social Security

I was eating the Schwarma Plate over at Meyman tonight, and I started scribbling in this little notebook I got at a bookstore in Hackescher Markt, and I got an idea. Not an original idea, exactly, but a good one. Also, I've been reading Freakonomics, which is very good, so that may have influenced my thinking also. This is the gist of the idea: instead of focusing on the old-timers with regard to social security, why not take the long view and focus on youngsters--that is, why not give people the money on the front-end and take advantage of compound interest, instead of forcing elderly people to subsist on a below-poverty-level budget. Here's how I was thinking it would work: the day you're born, $5,000 goes into your retirement fund, and that's it. The five grand goes into a stock index fund, maybe the S & P 500, and just sits there, compounding, until you turn 65. At 9% interest, that $5,000 turns into 1.3 million, which, in 2071 won't be a ton, but it will be better than the alternative. Also, the money you receive at birth could be indexed to inflation, which would increase the numbers. Right now, there are about 80 million people under 20 in the US. So that is about $400,000,000,000. That is about 400 billion dollars, not chump change, but not an unheard of amount of money. I think that's about 4% of GDP, so I think we could find the money. My guess is that Washington is wasting a lot of money now anyway, so I'm sure we could clean up some of the superfluous spending and find some loose change under the couch cushions. Anyway, I don't have all the details worked out yet, but let me know what you think so far, and if you have any ideas to improve on this.