Well yes, but its also a redistribution of wealth from those working to those not working. The money was taken from you involuntarily but instead of invested and put away as your capital. (Note there was a Supreme Court ruling that said you have NO PROPERTY RIGHT IN THIS MONEY!) Your money was quickly rushed out the door and given to the current generation of retirees. A “IOU” of sorts was put there instead of your cash. As long as there was a large number of contributors and a much smaller number of recipients. (Can anyone say Ponzi!) Also mortality and working demographics had to remain close to same as it was when the system was set up. Insurance executives testifying to Congress during the sessions of whether to or whether to not set up Social Security warned this was a false assumption! Remember Ida May Fuller (September 6, 1874 – January 31, 1975)the first American to receive a monthly benefit Social Security check. She received the check, amounting to $22.54, on January 31, 1940. By the time of her death, Fuller had collected $22,888.92 total from Social Security in monthly benefits, compared to her contributions of $24.75 to the system.
There have been a lot of Ida Mae Fuller's taking more out of the system then put in! Roughly anyone who lives 7 years (maybe less!) past the age of retirement is a net drain on the system. (Also Congress has increased the number of recipients over and above the original plan!) The system was supposed to have been inspired by the one set up by Bismark in old Imperial Germany. Does anyone out there know is there is any similarities? Has the German system changed? They lost two world wars, went through at least 2 financial disasters, and had 3 different forms of government (maybe 4 if you county the late unlamented East Germany!) and it looks like the "German system" still functions.
Roughly? Very roughly. I've paid the maximum into SS for as long as I can remember. Last count I got from SS was that my employer and I paid in over $200K. You think I'd get that back in 7 years?