Note to Jim Splaine - Part 2: What about Social Security? - Granite Grok

Note to Jim Splaine – Part 2: What about Social Security?

One of the first posts I ever did here on the ‘Grok had to do with Social Security:

…Far be it for me to clue those that want all the money they paid in over the years is long gone; there are no Trust Fund accounts with their names on to now draw against.  While they worked, they paid for Mr. & Mrs. Johns’ Social Security checks; now my taxes help to fund the current seasoned citizens’ monthly S.S. check and benefits.  In the private sector, Social Security is known by another name – a Ponzi scheme.  Illegal by others; legalized for and only for government purposes.  They may "demand" anything they wants, but the simple truth is that they did not pay earlier for what they now receive.  

The role of Social Security was never intended to provide anyone with a complete retirement fund.  Rather, it was created as a "floor" to guard against the poverty of senior citizens; it was never supposed to supply a sufficient income to supply a comfortable retirement.  It is not the general public’s fault, nor is it our responsibility, to pay for anyone’s retirement in full.  I am sorry that many do not realize this fact and fail to adequately plan to provide for themselves in retirement.  I may feel bad, but that’s their fault, not ours, and I and others should not have to pay for their mistake.  We should help, but only to a point.  There is no promise in the Declaration of Independance, the Constitution, or the Bill of Rights to give anyone the right of a reasonably comfortable retirement.  No one should expect one as an entitlement.  This brief anomaly of the general population able to enjoy a retirement may over; we all may need to work during our "retirement years".  Older folks got lucky, we didn’t.  Get over it.

…There is a saying "Good, Quick, or Cheap; pick two and call me later".  Think about it; any two choices excludes the third.  The equivalent in the Social Security arena is "Benefits, Taxes, and Demographics".  Benefits have risen as politicians have used it as a way to win votes. Taxes have already gone up since Social Security’s onset – from 2% to 12.4%.  And taxes will have to go even higher without changes made. Way higher.

Hmm, I get to say "Go read the whole thing" for my own post?  Er, yes.  It all comes down to TANSTAAFL – There Ain’t No Such Thing As A Free Lunch.   

It has grown FAR beyond the original intents, which were to provide:

  • a different name than what it really was at the time: "Widows Welfare"
  • a fulfillment of the Progressive tenet of providing a huge State provided entitlement

I could go on and say that it is one of the biggest dependency programs ever created, but that would be redundant – 

Here’s the answer to Rep. Splaine’s plaintive cry: it’s about to stop.  Hard.  Fast.  And all those people that Progressives want to help as being in that large cohort of "the most vulnerable part of society" are going to become left in the lurch – because of

  • the demographics of the Boomers
  • the soon-to-be-seen unwillingness of the remaining workers to give more of their pay to others than what they get to keep for themselves and their families.
  • the failure of Progressives to NOT spend the surpluses of the past on OTHER Progressive social programs.

Why?  It is has all but run out of money:

Veronique de Rugy puts it this way:

This chart compares the Congressional Budget Office’s (CBO’s) projections for the end of year balance of Social Security accounts from 2008 and 2009. These balances are presented as a percentage of taxable payroll, a weighted average of taxable wages and taxable self-employment income which provides an estimate of the earnings subject to payroll taxation each year. For perspective, in 2010 taxable payroll is projected to be $5.6 trillion in real terms. Concretely, when the balance of these accounts becomes negative, Social Security is paying out more in benefits than it collects in payroll taxes in a given year. In 2008, the CBO projected that outlays would exceed revenues for the first time 2019 and in 2009 CBO projected that this threshold would be crossed in 2016. In fact, this year Social Security will pay out more in benefits than it collects.

(H/T: Mercatus)

Europe was able to choose between "guns or butter" because the US provided the guns.  What will happen when the Progressives insist that the 18% of the national budget that goes defense (you know, that Constitutionally mandated feature of defending US Citizens from physical harm) go the same way?

Rebellion.

The answer to Rep. Splaine’s question is: it stops.  And because Progressives in Concord and Progressives (from both sides of the aisles) that have decided that more and more and more entitlements were the easy way to go, and that they were unwilling to stop the spending, have put the nation into such an economic squeeze that they have put us into the proverbial corner.

Soaring debt is going to eat up more and more of the budget – reducing the ability to spend on the social spending ("pay me now or pay me later – and they chose later").  Soon, the ability to borrow more to spend more will be gone as well – thus trapping Progressives between the hammer and the anvil.

What will happen?  Easy answer to come up with – we will go back to the model before FDR put us all on this track to serfdom: families taking care of other family members.  Instead of being dependent on Government table scraps and crumbs (and limiting retirees’ income from rising above that subsistence level), they will have to become responsible for themselves and we all will have to start saving for and providing our own retirements.  I said in that earlier post:

No one should expect one as an entitlement.  This brief anomaly of the general population able to enjoy a retirement may over; we all may need to work during our "retirement years".  Older folks got lucky, we didn’t.  Get over it.

There is a bright side to this.  In creating this massive entitlement, Progressives severed the tight bonds tying the older generation to the younger one – it deleted the moral obligation for the children to later care for their parents and instead, substituted the Government as the provider of elder care (yeah, that worked just SO well in France during their summer heat wave a few years ago; sons and daughters went on vacation and left Mom & Pop in the safe hands of the Government.  When Jane and Joey came back, they discovered that no one had been responsible for Mom &  Pop during the heat wave and they died). 

Freedom is not free – it REQUIRES responsibility and correct action.  Freedom will fail when citizens agree to outsource their responsibilities (to their children, to their elders, and for themselves).  And that, unfortunately, is what I see from Progressives and their programs that call, Siren like, louder and louder "Come hither – see what I, your Government, can give you for free!" and never mentioned that it is a case of "batteries not included" – there are strings attached to that dependence.

The largest, and most valuable, is of Freedom itself as when more and more hand over their responsibilities to Government, Government is forced to take more and more of those that haven’t.

The Bigger the Government, the Smaller the Citizen

Progressivism = incremental socialism

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