First, the capital accumulation system has high returns. The income of capital accumulation system is the marginal income of national capital. In the United States, the actual portfolio return rate is 7%, and the marginal return rate of capital in China is higher than that in the United States. In addition, the implied rate of return under the pay-as-you-go system should be the sum of population growth rate and productivity, which is about 3% in the United States and higher in China. The income under the pay-as-you-go system is always lower than the marginal income of capital under the capital accumulation system.

Secondly, the pay-as-you-go system distorts tax revenue, while the tax system under the fund accumulation system needs to be improved. Under the pay-as-you-go system, retired employees can get an average of 60% of their final income at work, of which 25% comes from pay-as-you-go social security benefits: for those who have worked for 40 years, the annuity in their personal account accounts accounts accounts accounts for 35% and can be bequeathed. Under the partial accumulation system, social security funds are deducted from wages, employers pay about 20% of wages, and individuals pay 8% of wages, which is a very high payroll tax. China pays twice the tax rate as the United States, but it still feels short of funds. What is the reason? Because the so-called 28% tax rate is actually only 1/3. Social security funds are not levied as taxes, and it is not illegal to evade, so the enforcement is very weak. Moreover, the tax base is calculated according to the salary of officials, which is much less than the actual cash income. At the same time, it is difficult for the informal sector to collect social security taxes. In addition, among the 28 percentage points of contributions, only 8 percentage points directly benefit individuals, and the rate of return of this part is very low, and the other 20 percentage points enter the social security plan as a whole. Most of the funds enter the overall planning, which means that paying social security funds is income tax, so individuals and factories have the motivation to evade taxes.