Who Broke the 'Promise' of Social Security?

In the Social Security debate, the one thing that every politician and media analyst seems to agree upon is that however Social Security is eventually saved, benefits for each retiree must not be reduced. To do so is unthinkable, because it would break the “promise” of Social Security. People have done their part, it is argued. They’ve paid their odious payroll taxes for decades and done so with the confidence that it was for a reason -- that in the end they would be provided for, at some humble level, in the twilight of their lives.

But what, exactly, was the “promise” that is now the most sacred cow in all of politics? It’s a very strange promise indeed that would seem to require us to eventually consume unthinkable portions of the economy just to keep it. And why have we been able to keep the promise for 70 years now, only to have it seem so untenable today? Did the promise change?

Let’s examine the promise as it was originally made to America by the New Dealers in the depths of the Great Depression. Social Security promised people who had not been able to provide for their individual retirements with their individual funds that -- were they to simply pool their resources -- they would be able to provide for their common retirements with their common funds. Essentially it promised that what was insufficient for one, when multiplied by ten, would somehow then be sufficient for ten -- or perhaps even eleven. Lacking the power to recapitulate the miracle of the loaves and fishes, the government pulled this trick off by adding an extra ingredient: theft.

The theft took several forms; one was income redistribution (shortchanging those who paid most to give to those who paid least). Another was a form of involuntary insurance in which everyone would be required to pay into the system, but anyone who died before retirement would get little back out, thus leaving more money for those who could still vote, i.e. the living. But the most important theft was intergenerational theft. The original recipients had paid little, if anything, into the system, yet received benefits. This was possible through the innovation known to prosecutors as a “Pyramid Scheme”. While people like to think they are paying for their own future retirement with their Social Security taxes, they are in fact paying for the current retirees. The money is taken from the young and given to the old, who “deserve” it because they paid for the old back when they were young -- all except for the original benefit recipients, who deserved their money for having voted for Roosevelt. The scheme worked, despite the fact that the average retiree received more in benefits than he paid in taxes, because there were always more young than old.

This was especially true at the outset of the program, when the retirement age was suspiciously near the average lifespan of the day. Thus, about half of all people would die before ever receiving a penny, and most of the rest could be counted on to die within a few years of retirement. Additionally, the system was created at a time when sex had a surprisingly direct correlation with pregnancy -- the birth control pill having not yet been invented, but sex having been known for some time. So the promise of Social Security, as originally offered, was something along the lines of “Have lots of kids and die young, and we’ll pay for your brief golden years by stealing from your kids, who’ll all think it’s ok, ‘cause later we’ll steal from their kids too.”

Looked at this way, it’s easy to see why the Social Security system is regarded as the greatest accomplishment of the Democratic party, and why it is the most hallowed of our government programs. That’s why the people that broke the promise should be so ashamed. These people include anyone who had fewer than five children or lived past 65. The prolific and dead are the bedrock upon which the system is built and deserve a round of applause. The rest of you, however, should stop whining about any proposed cut or alteration in benefits, because you have already failed to live up to your part of the promise, as originally agreed upon. Having unilaterally altered the contract in your favor, you should not be surprised when the whole system then needs recalibrating to take into account your selfish ways. You should be ashamed. But special blame must be heaped upon the drug industry, which as usual, is costing society billions. Were it not for Sulfa drugs, Penicillin, artificial estrogen and the like, the Social Security system would still be solvent as far as the eye can see. It’s easy to see why Michael Moore has singled the industry out as the target of his next Crockumentary.

But what is the poor government to do now that you have broken the promise? Obviously, it will have no choice but to raise the retirement age since you insist on living so long. (You can still retire whenever you want, you just can’t expect Social Security to subsidize your prolonged inactivity.) Additionally, it will need to decrease the rate at which benefits are slated to grow. Other common sense measures would include private accounts, as the President has proposed, not paying benefits to amnestied illegal immigrants, and as Phillip Longman has suggested, making it more affordable for people to have children, which are the only investment upon which future prosperity is really based. It is the poverty of children that will actually bankrupt the system, after all.

The only alternatives to such measures are to allow the system to continue to consume a greater and greater portion of our national productivity every generation -- or go back to dying early.

You are so right. Social security never was to and never has been a retirement program. It is a tax on all wage earners to provide a safety net for those who would starve without it. A bunch of money grubbing elderly Democrats want it to be a retirement program. It's not.

You are flat incorrect. Social Security's original intent was to provide economic security through taxes paid while working. The House passed it in 1935 in a 372-33 vote. The Senate vote was 77-6. Sounds pretty bipartisan to me. Not the Democratic rip-off I have heard from some.

Furthermore, at the same time and under the same bill the law created the nation's

1) unemployment system,
2) the now abolished Aid to Families with Dependent Children and,
3) an old-age assistance program along with,
4) it authorized grants to states to provode medical care.

I guess we need to eliminate ALL of those also. Wonder how long those collecting unemployment would believe these are solely Democratic programs?

We all partake at the well even those of us who consider ourselves Conservative. Tax credits are only another form of a social program. The ugly words directed to the elderly are totally uncalled for as they are not the fault of the SS crisis.

The facts need to be put on the table. It is the politicians, the robbery of the fund, the rule changes in the SS plan, the exodus of US companies taking jobs and contributing workers, NAFTA, outright government encouragement to limit family size due to population growth, the list goes on and on but it does not point to the elderly.

Common man is exactly who caused the system to fail. They Demand MORE FREE stuff. The retirees via AARP is the largest lobbying organization going today. The Congresscritters cave when the Greedy Old Geezers come calling.

I agree.

An example of wanting something for nothing:

This morning on the local news.

FPL (Florida Power & Light) will charge $2.09 extra a month for two years to rebuild their hurricane fund. They spent over 354 million dollars repairing the damages that the hurricanes caused here and they need to restock. The reporter interviewed 5 people. Naturally the reporter exuded the "HOW UNFAIR" attitude. Four of them whined and complained about it being too much. Only one said it was fine to restock the fund, but even he was worried about how long they would try to collect the extra $2.09 a month.

I really hate screaming at my TV this early in the morning, but I am really getting tired of everybody wanting something for nothing! FPL did a great job fixing the electrical system around here. We had two hurricanes come through within three weeks and all they are asking for is $2.09 a month for two years? Come on people!

There are "conservatives" on this site who defend this Ponzi scheme

Not I. Matter of fact, my early twenties children can't wait until SS is destroyed. They absolutely detest it and are spreading the word. They want their money in an account with their name on it, which they control, like their other accounts. They know that they are paying for seniors right now and not a penny of FICA is being saved for their retirement.

By the way, I can't take any responsibility for their thoughts on SS. They have grandparents that have reinforced their thoughts on this with their actions. I've always taught them to respect their elders, but they are adults now and they are really having a hard time with the Social Security issue. They see this as "greedy seniors" trying to keep Social Security from being privitatized for the young people.

Your children are correct, the other FReepers who defend these big government wealth transfer schemes are wrong. I am on another thread right now where the feel good "conservatives" (really liberals) are defending the ADA.

Amazing stuff. Who needs to debate DU liberals when we have a whole contingent right here on FR?

Since I worked for the SSA for three years, I am familiar with the intent of the program.
As originally designed, the OAS program was intended to provide only a basic floor of income - certainly a worthy goal - but was not intended to be a comprehensive retirement or a pension program.
The designers intended that pensions and savings would provide the other sources of income needed to sustain the elderly after their working years.
If politicians chose to morph Social Security into something
else, that speaks for the cupidity of our political class and not for the original design of the system.
Again, if politicians chose to loot the fund - an act that can be traced to LBJ's merging of Social Security and general fund revenues - then that speaks to the cupidity of our political class.
The decline in manufacturing employment is unrelated to the problems of the Social Security system.

I do not believe the common man was at fault for any part of the plan not working. It could have worked if our former presidents and politicians had left it alone. But then they can't leave the Constitution alone either and look what has happened.

Given the opportunity, nothing is as much fun as spending other people's money. This is something most politicians cannot resist. But privatization is a way to have a government sponsored retirement plan (thus keeping the political promise) and forcing politicians to keep their hands off at least the part that is in a private account.

Suggesting tongue in cheek that we should die earlier is certainly a solution, so why is government so intent on banning smoking, it seems we should encourage such risky habbits and drop benefits from medicare.

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