Social Security Fraud

Social Security faces crash

For two-thirds of Americans age 65 or older, a Social Security check is their top source of income. For one in five, it's all they have.

Today's workers better not rely as heavily on the overburdened federal retirement system, the Social Security Administration is warning in a nationwide education tour this month.

"Americans really are counting too much on Social Security," Deputy Commissioner James Lockhart said. "We just put out our 75-year forecast, and it shows that over the long term, there are serious financing issues."

An overview of those euphemistic "issues" can be read here. The essentials? The mid-range projections show the Trust Funds to be depleted by 2041, yearly costs will outstrip income by 2017, and the amount of GDP consumed by the program will balloon from the current 4.5% to 7%. The worst senario projections show the funds will be sucked dry by 2029.

Social Security, established in 1935, provides a check to nearly all retirees who worked in wage and salary jobs or were self-employed. To participate, workers and their employers each pay taxes equal to 6.2 percent of covered wages, up to $87,000 this year.

Robbing Peter to pay Paul is the design here, as is the usual design in government programs. Income is stolen (I certainly don't recall asking that this money be taken from me) and then doled out to retirees. It's bad enough that this is happening, but it's even worse that what I've paid into the system is highly unlikely to ever get returned to me.

The system was designed not as an individual savings plan but as a promise between generations. Taxes on today's workers provide the monthly checks for yesterday's workers.

How the original architects didn't imagine a rapidly aging population is unimportant; they probably ignored any such hypotheticals anyway during the debate leading up to the SSA's creation.

At first, keeping the promise was easy. In 1955, the country had nearly nine workers for each person receiving Social Security. But with longer lives and lower birth rates, the government projects that by 2030 only about two workers will be available to support each beneficiary.

It's really almost as if they completely ignored the progress of civilization and science and assumed the nation would grow and change through a linear scale.

To prepare for this demographic shift, the Social Security Administration has been building a reserve, at least on paper.

Excess payroll taxes that aren't needed to pay benefits are invested in special U.S. Treasury bonds. These bonds, worth about $1.2 trillion at the end of last year, make up the Social Security Trust Fund.

Unfortunately for tomorrow's retirees, the tax money that bought those bonds has been spent to keep the federal government running. The bonds themselves are nothing more than IOUs that the federal government has written to itself against the day that payroll taxes are no longer sufficient to pay Social Security benefits.

And thus, the FRAUD. Read that again and understand just how idiodic the entire scheme is.

And that day is not far off. In March, the program's trustees estimated that by 2018 Social Security will have to start cashing its IOUs. In 2042, the trust fund will run out of money, and payroll-tax revenue will cover only 73 percent of payable benefits.

I'll be 62 in that hypothetical year. Over forty years of having a percentage of my income taken from me without my consent. Assuming they don't change the retirement age framework, I'll just be able to start drawing benefits...but at a reduced level as a penalty for not waiting until I'm 67.

It's MY money.
It was taken from me with the promise to return it in the future.
I have no useful or practical control over it.
Other people determine how I can use it and when I can withdraw it.
And it's MY fucking money.

As I wrote previously, the amount of sense it makes to use this money privately and invest it is so tremendous, only the Left could condemn it.

So starting in 2018, Congress faces a range of politically painful choices. It could raise payroll taxes, cut other government programs or run up the federal debt, all of which may anger younger workers. Or it could slash Social Security benefits or raise the retirement age again, which would anger older workers and retirees.

OR...we could put a stop to this nonsense entirely, pay every living person back what was stolen from them, and never again attempt to try something like this.

To avoid such drastic measures, lawmakers have been discussing Social Security reforms for years.

Ha! The "politicians to the rescue" bit. I don't buy it and neither should anyone else. Not until we have a group of politicians powerful enough and smart enough to dismantle the entire scheme and bury it. There's a reason why it's described as a "ponzi scheme."

But progress has been especially slow under President Bush, said Robert Bixby, executive director of the Concord Coalition, a group that lobbies for a balanced federal budget and Social Security reform.

The issue "isn't on the front burner. It isn't even on the back burner," Bixby said. "It's in the deep freeze."

That's because the White House has been focused on cutting taxes. In 2001, Bush spurred Congress to cut taxes by $1.35 trillion over 10 years. Another 10-year, $350 billion cut is nearing approval in Congress.

At the same time, the 2001 terrorist attacks and the war in Iraq have added tens of billions of dollars in federal spending, even as the weak economy has sapped tax revenues.

While this is obviously important to Social Security's future and all that, it doesn't make one damn bit of difference in the first place. The state doesn't trust you to save for yourself so it assumes the role of your money's owner and chooses where to put and how to use it. That is fundamentally wrong.

Posted by Drizzten at May 27, 2003 09:30 PM