For example, a Galveston County retiree who worked for 40 years with an annual salary of $30,000 would receive around $2,400 a month for retirement, while that same county employee would have received just $1,077 from Social Security. Galveston County employees are averaging returns of 7.5 to 8 percent while Social Security returns averaged about 2 percent. On top of this, the county has been able to provide a life insurance benefit, which Social Security does not offer, and disability insurance that is superior to Social Security's disability program.

What about death and disability benefits? While Social Security pays an insulting one-time death benefit of $255 -- less than the cost of a pine box -- the private plan pays triple the worker's salary up to $150,000, with a guaranteed minimum of $50,000.

Private-account proponents are eyeing these three small Texas counties as a living example of what a private model could look like. The only thing is, these accounts are vastly different than most currently-proposed reforms.

Whether retirees' are better or worse off under the Alternate Plan than they would have been under Social Security -- a point over which there is some debate -- they're enjoying a profoundly different type of private account than is currently touted by some lawmakers.

Under the Alternate Plan, workers' money is not invested directly in the stock market, but solely in annuities, earning an interest rate which adjusts each quarter but never drops below a minimum of 4 percent, a rate that's guaranteed by the insurance companies holding the annuities. …

"If I were to give President Bush any advice," investment manager Gornto said, "the one thing I would suggest is to set up the new alternate plans on a banking model rather than a market model." …

Under the Texas plan, the minimum 4 percent return (before inflation) is guaranteed, but workers don't control how their money is invested: It all goes into annuities. …

Workers pay 6.1 percent of their earnings into a private account, similar to the 6.2 percent other U.S. workers pay to Social Security.

Their employers toss in about 7.7 percent (the three counties' rates vary slightly) compared with the 6.2 percent other employers pay to the traditional system.

While middle and higher income workers appear to reap higher benefits in retirement under the Texas plan than under the traditional Social Security system, lower income workers may end up short. …

A key difference between the Alternate Plan model and Social Security is that lower-income workers are better protected under the current retirement system. …

The GAO found that a low-income worker averaging about $17,120 annually would collect $617 in initial monthly benefits under the Alternate Plan, vs. $750 from Social Security. …

Still, the GAO report agreed that middle- and high-income earners would do better under the Alternate Plan. …

Survivor benefits, however, may be more limited under the Alternate Plan. If a worker dies before retirement, the Alternate Plan provides his heirs a lump-sum benefit of four times the worker's salary, with the minimum benefit starting at $75,000 and maxing out at $215,000, no matter how many dependents the worker has.

Social Security provides a survivor benefit to each minor child, so the more children in a family, the more likely the total Social Security pay-out will exceed that offered by the Alternate Plan.

For instance, looking at a low-wage worker who dies at age 45, the GAO found the surviving spouse with two dependent children would collect $1,602 per month from Social Security, but just $831 per month under the Alternate Plan after annuitizing the lump-sum benefit.