The decline in the work force in western world is not really that sharp that it would damage the economy -- especially ridicule when you consider the productivity increases. The bigger issue is the work-force/retired population ratio. Its a problem because of the short-sighted way politicians in most countries implemented social security. Its a ponzi scheme and they have been doing all kinds of gymnastics to keep it going -- extending the contributors pool, reducing on the work-wage/retirement-pay, increasing the retirement age, and other tricks. If this was done in the private sector, you can be sure, a few people would be going for jail if they come up with such a scheme.
Similarly, medical assistance is paid through taxation of the current work force, so it puts a lot of stress in the economy, as taxes necessarily have to be increased. In my country, they have opted now for reducing medical assistance (which is provided entirely via taxes, managed by bureaucrats), so clinics on cities that people go to retire have been closing. First, the emergency room, now its the entire service.

But then who would work to pay for the care of the elderly? I am no expert in economics, just an autodidact who started studying it to not look like an idiot when others were discussing it, but I personally like the idea of savings on commodities. Its true that they oscillate in price -- demand can be especially alarming as people discover ways to go without them -- but supply tends to become more expensive, and there are always uses for them. And you can diversify. So social security should just keep reserves of oil, metals, etc. ;) Even the Greens would like it, as it ensures some sustainability in using earth resources. Investing in capital will also get you dividends while developing the economy. Anyway, of course you want to privatize it, and let the free market find the best strategy.