How to kill Social Security in 2 easy steps

New Deal

thanks for saying that. i’ve been saying it for years. all i got for my trouble was to called an asshole by “Social Security Works,” who just want “the rich to pay their fair share.”

the fact is the rich already pay their fair share. unless you (generic you) are one of those who believe that a man who makes ten times as much as you should pay ten times as much for his groceries or ten times as much for his chevrolet.

the whole point of Social Security was that it was “not the dole.” FDR understood this. his SS commission did not. he had to step in and “put in that [payroll] tax so no damn politician can take it away from them [the workers who pay the tax].”

the insane right has always though the first step to killing social security was to turn it into welfare. and the best way to do that was to talk about it as though it were already welfare. it took them 70 years but now they have got the insane left talking about SS as though it is welfare and so it needs to be turned into welfare as we knew it.

sorry to those who have already heard this more than they like: “fixing” SS would take an extra dollar per week per worker raise in the payroll tax for a few years.

or, if SS benefits are not enough (they are just barely enough in order to keep costs down. raise the costs and even more people will decide to kill it.) raise the payroll tax another dollar per week (under the cap) and provide about 10% more benefits, or more, or less, depending on the bend points in the payout formula.

and yes, that dollar per week per year adds up… but not as much as the innumerate imagine. while the tax is going up a dollar per week per year, incomes will be going up more than ten dollars per week per year. so when the tax reaches 8% as high as it will ever need to go) your income will have grown to 20% and more after that, leaving you with about twice as much money after you pay the increased tax as you have today after paying the 6% tax. and the 8% is not money that goes into a government black hole. it is money that comes back to you threefold (including inflation) when you are going to need it most.

this is pretty simple stuff, or would be if it had already happened. no one would think twice about it. but it’s truly amazing to watch them struggle with the concept in the abstract.

well, to be fair, they don’t struggle. they scream “it’s no fair! we’re all going to die! it’s the greedy geezers burdening the young.” the forever young.

U

thanks. i am no politician. and have no idea how Kevin Drum thinks.

I find it nearly impossible to explain how SS works to people who are unwilling to think for ten minutes, or who have a fixed idea that “the rich should pay for it”. maybe in a fair world they would. maybe in a sane world the “government” would pay for it so the people wouldn’t have to bother their pretty little heads about it… or realize “the government” is just “them”… so they could go on complaining about taxes and taking their old age pension as their right.

but in America the rich won’t pay for worker’s pensions, and the workers won’t pay for the pensions of “the poor.” Roosevelt understood this and designed a system whereby the workers pay for their own pensions, with their own savings protected from inflation and market losses by pay as you go financing. it took the insane right seventy years to convince everyone that pay as you go “really means” that the young pay for the old. so now “the young” (who will never be old) can feel themselves “burdened” by “the old.”

Sammy

pretty good for you. you make perfect sense according to what you know about Social Security.

which, unfortunately, is basically nothing. Social Security was designed to work the way it does given the reality of politics in America.

People pay a flat percent of what they earn with the expectation that they will get a fair return on their money. And they do.

When people are asked to pay a tax “for the poor” (welfare) the pretty soon get tired of it, and kill the program (welfare as we knew it).

The rich get back pretty much what they pay in, adjusted for inflation and a small real interest rate based on the growth in the economy.

The value for “the rich” is the insurance: they might not have ended up “rich” at the end of their working careers.

everyone else gets back what they paid in adjusted for inflation and a larger real interest based on the growth in the economy… it not only keeps them out of the poorhouse bur provide a nice supplement to whatever they were able to save or earn from investments in the marketplace. most earners are very happy to get this supplement.

the poorest get back everything they paid in adjusted for inflation and a nice real interest based on the growth in the economy plus an insurance adjustment so that they will have enough to keep them out of the poorhouse.

Americans are not as generous as you think, nor as rich, nor as smart. Without SS as it is, more than half the people would retire into what they would feel as poverty, but with your idea of not paying “the rich” they would still be paying the tax and see nothing back from what they paid.

So coberly, you fancy yourself a numbers guy. Here is a chart of the average, average, and median household net worth by age:

http://i0.wp.com/www.freedomthirtyfiveblog.com/kj4tv8dlagreat/wp-content/uploads/2013/07/13_07_networth_agestats.jpg?resize=451%2C350

As you can see, the average net worth for the 55 year+ is around $600K, the median is around $200K, which means there are a lot of very rich people, and many not so rich. Below 55 is even poorer. So you consider yourself some kind of benevolent caped crusader for the poor, when in fact you are Robin Hood In Reverse. Maybe being retired has an effect on your “judgement.”