Who wrote this? A Demopublican or Republicrat?
Back in 1959 when my dad died, almost everyone had a pension waiting for them when they hit sixty-five. You’d get a fancy watch, a goodbye party, a pat on the back by the boss, handshakes from your colleagues and out the door you went. A month later you got your first pension check. If you were a union member, you usually got a pension from the brotherhood as well.
A pension. This was part of the promise the company made to you for your decades of toil on its behalf. These pensions were mostly the result of unions. Pension were part of the negotiated compensation packages and while not generous, pensions took care of you. Companies could afford these pensions because most people died in the harness before they were eligible for retirement. In my dad’s case, cancer took his life when he was fifty-nine, six years before reaching the magic number of 65. No pension there.
Back when Social Security was developed, most people earned their bread by back-braking toil that left them spent and used up with broken health long before age sixty-five, then they died. If they lived beyond sixty-five, they didn’t live long. Social Security was there to prevent these ruined old men and women from living in dire poverty. Oh, sure, the scolds on the TV money shows put their noses in the air and sniff that it was the old farts’ own fault because they didn’t save. Well I’ve got news for the scolds: People didn’t make enough to save. In any case, along came FDR and Social Security which was — and still is — a compulsory savings plan.
Now it’s 2017 and pensions are things of the past, as are the unions that got them. Now, people have to rely on the pathetic 401k plans and outright investments (mutual funds, real estate investment trusts, etc). The trouble is these things are not reliable, as recent history has amply demonstrated. You can get seriously burned. Witness Enron whose collapse left many people stony-assed broke. Of course the miscreants who skinned the investors were jailed, but that’s small comfort to the thousands whose dreams of a comfortable retirement went down the drain. The only thing they had left was — you guessed it — Social Security. With the death of traditional corporate pension plans, Social Security has become America’s pension plan. For most of us today, there is nothing else.
Of course, some say Social Security is nothing but a con. A Ponzi-like scheme that takes from the young to give to the (always deemed improvident and undeserving) old. Yes, it does — just like the insurance policy you buy from Prudential or The Hartford or whomever. It’s the good old free market. Nothing wrong with that, is there?
Now, as to how much you “contribute” (their word, not mine) to your Social Security account: If you are an employee, you see the FICA deduction on every pay stub. But that’s only half; the employer kicks in an equal amount. Your FICA is $50, your boss kick-in another $50 for a grand total of $100. This is why Social Security is solvent.
Another seldom-recognized fact: Social Security is not part of the Federal budget. It stands alone. It’s independent. To say that because the Federal budget is a mess, Social Security is a mess too, is disingenuous.
If Social Security is not as funded as well as could be, and should be, it’s because Congress keeps plundering the Social Security fund to pay for such things as pet projects and wars. Yes, wars. Why haven’t your taxes gone up to pay for a set of wars whose price tag, buy some accounts, is over $1,000,000,000,000? Because Congress plundered the Social Security fund to pay for them, that’s why. If we had prevented Congress from touching the fund, or interfering with its management, we’d all be retiring at age 50.
So, then; we should keep Social; Security, but with some provisos.
- Social Security remains outside the Federal budget.
- Congress keeps its mitts off.
- To reduce the temptation of raiding the fund, there will be a hefty War Tax levied on all taxpayers whenever Congress sends troops overseas to fight.
- FICA will apply to every dollar earned: Salary, commissions, investments, hedge funds — whatever.
- As with FICA, there will be no cap on incomes.
- Estates providing $5,000,000 or less to each heir will be tax-free. Over that, the estate will be treated as a Social Security contribution. It will be liquidated and the proceeds will go directly into the Social Security trust fund. NOTE: This proviso should be especially appealing to those who heatedly admonish others to stand on their own two feet and pull themselves up by their bootstraps.
We keep Social Security.