Posted on 01/12/2005 2:27:50 AM PST by kattracks
Nothing gets the Democrats’ partisan juices flowing faster than Republican attempts to straighten out the ailing Social Security system before the ailment becomes terminal.Most Americans, unaware of the machinations and deceptions that attended the birth of Social Security when it was signed into law on August 14, 1935, think it’s some kind of pension system where they pay premiums in the form of payroll taxes which are put aside in a trust fund from which they can draw benefits once they reach the age of 65.
The late Sen. Carl Curtis, R-NE, elected to the U.S. House of Representatives in 1939, made a careful study of Social Security when it began making payments in 1940. As he told a friend of mine, he tried mightily to get the Roosevelt administration to stop calling the program an old-age insurance program and describe it for what it is: a tax on workers to pay benefits to those no longer working. Had they and his colleagues listened to him we wouldn’t be facing a fiscal catastrophe down the road.
But nobody was in the mood to listen because they recognized that the Social Security system would be the goose that laid the golden eggs – not for workers and retirees, but for Congress and the federal government who could loot the system to their heart’s content, using the money to pay for all the social welfare spending schemes they otherwise would have had to finance by raising income taxes.
Social Security was a Ponzi scheme that carried within it the seeds of an eventual collapse as long as it continued to be operated as it was created to operate. It was based on what amounts to a series of misjudgments and criminal deceptions.
• When the government established Social Security, they didn’t plan for most Americans to live long enough to collect the benefits. In 1940, the life expectancy was 63.6 years and the age at which benefits were paid was and is 65. And if you did live that long, you probably wouldn’t have been around much longer to draw money from the system. In other words, they found a new way to collect money from you based on the fiction that that it was yours and you could start collecting it when you reach 65, which they figured most of you would not.
• The government claimed that the Social Security taxes you paid belonged to you, and were being squirreled safely away in a trust fund on which you could begin to draw at the age of 65. But instead of putting the money in a trust fund, the Treasury spends the difference on roads, sex-education programs, parks etc. The trust fund gets an I.O.U. If you die before reaching 65, which they expect you to be gracious enough to oblige them by doing, your survivors in most cases collect a big fat zero.
Things are no different today, except that we Americans have been stubborn enough to live a lot longer, with life expectancy of the average American now approaching 80. That of course means that if you retire at 65 and live to be 80, you’ll be collecting benefits for 15 years. That’s significant in light of the fact that there are fewer and fewer workers paying into the system to provide Social Security benefits to more and more retirees.
Wrote the Heritage Foundation’s Rich Tucker "… starting in 2018 … the system will owe more in benefits than it will collect in taxes. Heritage Foundation Social Security expert David John estimates 'annual deficits will exceed $100 billion within about five years, $200 billion after about ten years, and $300 billion after about fifteen years.'"
At that point the burden will fall on income tax payers who will get socked with a horrendous tax bill.
This is what President Bush is trying to deal with. Tragically, the Democrats like the system just as it is – they’re hooked on looting the trust funds and they don’t want to get off the gravy train. Keep that in mind the next time you hear one of them lying about those rascally Republicans plotting to kill Social Security.
Mike Reagan, the eldest son of President Ronald Reagan, is heard on more than 200 talk radio stations nationally as part of the Radio America Network.
That's the one.
Even more tragically, Democrats like the system because it creates an indentured constituency.
Stretch here...The Old Geezer... Remember, folks, even tho it is a ponzi scheme---then and now.... At the time it was started we were in the greatest depression the world has ever known. Most people had little education. Only the wealthy could finish school and college was only a dream. Kids quit school at 14 or 15 to help out. ten and fifteen cents an hour was the going rate for common labor. The small towns had no industry. There was no chance of the old folks (old at about 40) trying to save a cent. They never got caught up. I remember when Henry Ford announced that every worker will be paid $5.00 per day... And that was a fortune. But there were no jobs to be had...NONE, ZILCH, NADA... And many of the old folks on social security are from those working days... My mother never worked. My father eaked out a miserable "getby" living on a small farm. Never worked in a place where they paid a wage to pay into social security. When my dad was too old to work he lived off the genorosity of his children. He never paid in a cent and lived to 69. never drew a penny because he never paid into it. There were some "welfare programs, but he would never accept such. "No relief for him" That was shameful....
Wages didn't rise much until during the 70's. Three and four dollars an hour was a good wage then. I graduated high school but couldn't even think of college because I had to contribute so much to the family. I worked in offices, meter readers, taxi driver, small factories that paid next to nothing...anything that paid a little more than what I was earning. I went to work for Studebaker Corp. where I earned about three dollars an hour, but they went bankrupt in the early fifties. I finally got into construction. Our union finally got to $5.00 an hour in 1970.. And that was a big wage. Those are the wages on which I am drawing my social security. Many, many old people today are drawing social security on those kind of wages... $2, $3,$4, an hour. Many were never able to save anything.
Today's retirees are coming from a different world.. a world where they earned a huge amount of money compared to whose who worked in the 30's and 40's. Today one can put away a little...many even a lot. But it wasn't there then for the old folks today. The wealthy living in Florida in retirement homes were the fortunate ones who were able to get a good education; ie, the county government workers, the auto workers, supervisors, teachers... and small businessmen, farmers who were able to sell their lands at a huge price.
What I am saying is this: don't be too hard on the old folks drawing SS today. Many aare products of the "GREAT DEPRESSION" of the 30's... I have been lucky. For the past 25 years I have earned enough to save some but got into some real-estate where I made some good money. But, think of the many who had no chance such as I did. The politicians are the ones to blame for the SS fiasco with their greed. If the SS money could have been placed into investment accounts, the interest earned would be astronomical..... and there would be no need for a fix.
You make some good points. Just keep in mind when the greedy crooks try to scare old people into keeping Congress's gravy train going as it has the past 50 years that if private companies spent their pension funds the way Congress has done, their officers would all do jail time. Instead, we have re-elected the looters, letting them buy votes with our pension money so they can stay in office. And now they are trying to convince the gullible that they can be trusted more than the US stock market that would return 4-5 times as much in benefits for only a 3-4% investment of SS funds. I guess that's the beauty of a government school system that teaches little in the way of math and nothing in the way of logic.
I, for one, don't think the folks, at least most of them, who are drawing and have drawn Social Security checks are to blame. Some blame goes to lobbying groups like AARP who have and are fighting reforms that could keep the system viable. The bulk of the blame goes to politicians who have refused, and are refusing, to acknowlege that times have changed and the system needs to adapt. The longer they wait, the bigger the problem gets.
I looked at my plans projections for payout this morning and discovered that at the low end I am expected to receive about $1600/month and at the high end I could get as much as $2700/month at age 62. That would be after only 15 years of putting in amounts comparable to what Social Security receives from me. My projected Social Security payments are about $1000/month at age 62.
It's easy to see that if I had been putting all my Social Security money into a private account over the years, I would be getting a LOT more money per month (most likely over $20,000 as a low-end) compared to what Social Security pays. Anyone opposed to reforming Social Security is opposed to having the future retirees being anywhere from comfortably well-off to half-way wealthy.
The AVERAGE or MEDIAN life expectancy was 63.6 years. In orther words HALF the population lived longer...many quite a bit longer. If the author is wrong about something so basic is this article worth anything at all?
What I am saying is this: don't be too hard on the old folks drawing SS today.
Doesn't matter, if the current median is higher than the original, and retirement age is still 65, the logic stands
The author claimed that there were very few beneficiaries initally. WRONG. But it is true that the rise in the median has created problems which must be addressed.
Reform has nothing to do with current retirees. It's none of their business, frankly.
12 posted on 01/12/2005 8:23:33 AM PST by Beelzebubba (Your Friendly Freeper Patent Attorney)
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I share your rant.
Current beneficiaries should enjoy no benefit (e.g. retiring before 70, no means testing, non-taxability of part) that those who are working to support them can't be guaranteed.
Moreover, they should not get more of a benefit for a given contribution than those who are making a comparable (inflation adjusted) contribution can be expected to receive. That means that if the retirees were SS taxed only 3% on the first 10,000, and the rest are taxed more than double that on the first 90k, things should be adjusted.
That is "fair" and should be the starting point for reform.
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