A growing mountain of evidence and argument addresses our other-regarding side. (Some even deride the homo economicus straw man.) A fun read is Darwin's Cathedral by David Sloan Wilson. The religions that have flourished resulted from adaptive evolutionary forces that selected practical arrangements for supporting group fellows. (I was a co-editor of The Voluntary City, which presents supporting examples assembled and sifted by various scholars.)
The social security reform debate (and the one to follow re Medicare/Medicaid) focuses a lot of attention on private accounts and what we can/should do about those who completely blow it. This aspect is on almost everyone's mind -- but to varying extent.
What happems when the other-regarding impulse is extended beyond the identifiable groups that once formed religious groups? The welfare state is a poor response because it involves collective action problems and ungainly bureaucracy.
A limited state role (vouchers and credits) would allow scope for voluntary group actions (including schools and insurance pools). The standard objection is that these might "re-segregate" society. Yes and no. The group impulse may be as strong as ever. Neighborhood associations across America are growing. Not all function as communities but many do. It is probably a good idea to let them form schools and insurance pools as they see fit.
The welfare state would the be the last and not the first resort.