Posted on 01/24/2005 10:20:14 AM PST by jmc813
Social Security reform promises to be the biggest domestic issue this year in Washington, but most of the proposals are nothing more than flim-flam. The only honest solution to the future insolvency of the program is for Congress to stop spending so much money. Unless Congress makes real cuts in spending-- and stops spending Social Security taxes on completely unrelated programs-- millions of Americans simply will not receive even a fraction of the money they paid into Social Security. Ignore the rhetoric about tax increases and cuts in benefits, as though you are to blame for the problem! All Social Security obligations could be met if Congress did not spend so much on other things.
In the 1930s, Social Security was presented to the American people as a social insurance program, with individuals paying a monthly “premium” in exchange for retirement benefits later. It was supposed to be a forced savings program, based on the assumption that some people would be unable or unwilling to save for their older years. Seven decades later, however, the ratio of younger working people to older retirees has changed dramatically, exposing the Ponzi-like congressional raid on the system itself. What has not changed, however, is our willingness to accept the notion that the government should force us to save for our older years.
Notice that neither political party proposes letting people opt out of Social Security, which exposes the lie that your contributions are set aside and saved. After all, if your contributions really are put aside for your retirement, the money will be there earning interest, right? If your money is put away in a trust fund account with your name on it, what difference would it make if your neighbor chooses not to participate in the program?
The truth, of course, is that your contributions are not put aside. Social Security is simply a tax. Like all taxes, the money collected is spent immediately as general revenues to fund the federal government. The Social Security trust fund does not exist, and Social Security “surpluses” are nothing more than an accounting ledger showing that contributions exceeded benefits paid for a given calendar year-- not that the excess was put aside. Social Security benefits are paid each year from general funds, like other federal programs. Since these programs and overall spending keep increasing, the government can’t give up any sources of tax revenue. Allowing people to opt out of Social Security would force the federal government to admit it has been stealing money from Social Security for decades.
The administration speaks of private accounts, but government-managed investment of Social Security funds is not privatization at all. True capitalism by definition operates without government interference, and we should oppose further government involvement in the financial markets. After all, which government officials will decide what stocks, bonds, mutual funds, or other investment vehicles are approved? Which politicians will you trust to decide what your portfolio may contain? Imagine the lobbyists fighting over which special interests will have their favored investments approved for Social Security accounts. Political favoritism, rather than market performance, will determine what investments are allowed, and Social Security in essence will become a huge source of taxpayer-provided investment capital.
If the administration truly wants to give people more control over their retirement dollars, why not simply reduce payroll taxes and let them keep their own money to invest privately as they see fit? This is the true private solution.
Your money has never been safe in the government’s hands, and it never will be. Governments spend money; it’s just their nature. It is preposterous to believe our government is capable of simply sitting on a huge pile of money without touching it because it’s earmarked for one purpose or another. No matter what politicians promise, Social Security reform will not change the fact that your money is taken from your paycheck and sent to Washington, where it will be spent.
May I add -- TERM LIMITS! No more lifetime congresscreatures, and you take away what fuels Washington -- POWER (and money.) How many of these people go to DC as regular, middle-class people and leave as millionaires???? The Clintons come to mind!
BTTP on your whole post.
I have a cousin that he delivered.
It cannot be "well financed". The system is not designed to be financed. It is only designed to redistribute wealth.
A system with a real trust fund, a PERSONAL PRIVATE TRUST FUND, owned by the individual in his own name in a private institution, exactly like an IRA or Keogh plan, is the only way to finance a plan.
Dr Paul is my hero.
and now...............
You are on my "to be admired" list.
I agree w/ you 100,000%, I was just trying to translate what another poster was saying.
But absolutely, the Social Security Trust Fund is the greatest financial fraud in the history of mankind.
Bump.
One of the reasons a lot of people support SS is that it's true, many even with high incomes don't save for retirement. I would love to do away with SS entirely, as long as we cut off welfare to seniors as well. That way, those who didn't save for retirement won't suck off the gov't teat another way.
fully agree w/ you. I was just offering a translation of the other poster's comment, which I think was tongue-in-cheek anyway.
Seriously, I fear that the public won't accept Social Security reform until more of them understand basic accounting, but it kills me to think that Republicans may let this opportunity to at least make a terrible system a tiny bit better slip through their fingers. It is time for someone to explain the Social Security Trust Fund to the public.
Even a pretty sophisticated financial journalist like John Berry, ex of the Washington Post showed over the weekend at www.bloomberg.com that he has absolutely no comprehension of the sleight-of-hand behind the so-called Trust Fund.
in Lake Jackson TX? That is where I live right now.
Why is that the government's business?
I would love to do away with SS entirely, as long as we cut off welfare to seniors as well
Welfare to everyone should be done away with.
That way, those who didn't save for retirement won't suck off the gov't teat another way.
Even if you decide that people should be forced to save for their retirement, the current scheme would be entirely inappropriate.
I agree entirely with your premise; none of it is the gov't business. However, we have layer after layer of socialist programs that we need to start peeling back, and I was merely pointing out that there were loopholes to close in other programs.
Yes, I'd love to roll back govt to about 1786 levels; the reality is we are not going to be able to do that at least all in one year. We need to start somewhere, and keep going.
The somewhere is here, the time is now.
I want to totally privatize it right now on the way to abolishing it. I understand that no one in government and very few in the public have the balls to do that. And they are not proposing it.
This tiny thing is only a beginning baby step.
It might be hard to do this tiny thing as long as so many Freepers are against doing anything. If we can't even get these pretend conservatives to agree that SS is a bad system, how will we convince the country?
The voters bear equal blame. The more they demand, the more politicians spend.
But it APPEARS to exist, and for each one of us who knows its a fraud, there is a sober statement from the news media saying the Trust Fund will last until 2070 or some nonsense.
I want to come up with a sound bite to show the government to say that it has invested money in government bonds is ipso facto absurd, but people don't understand money. They don't understand that you cannot call a liability an asset. If I went into the bank and asked for a loan they would ask what I had for collateral. If I told them I had 40 million dollars worth of bonds they would be impressed, but would lose that respect when they learned that the bonds were 40 million Babble-On bonds, guaranteed by the full faith and credit of me. Social Security Trust Fund is the same thing. An asset which consists of saying that you'll go out and get the 4 trillion bucks somewhere else when you really need it.
I think it is safe to assume that the great majority of Freepers understand and agree with this statement. It is true.
What many may not remember is that our hero Ronald Reagan raised those very taxes in the early 80's "too save Social Security". In fact, all he did was raise our taxes via the payroll tax while cutting the income tax. I'm sure it was net plus for the taxpayer but don't kid yourself, he just built another giant slush fund for congress to spend in order to insure that they get re-elected. It was a foolish thing for him to do. We have been running a surplus in the SS tax collections ever since and every penny of it has been spent.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.