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Is Social Security a form of embezzlement?

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WorldsEdge
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28 Mar 2010, 2:38 am

DW_a_mom wrote:
But the system we set up to do that never was what the government claimed it was, and people continue to falsely believe they are getting their own money back. We cannot afford to continue the program that way, for it is crippling.


What are you saying the government claimed it was? Everything I've ever read -- and I mean written from the 1930s on -- has simply called it "contributions" for which you receive a "benefit," in reference to the retirement payouts. I'm especially curious at your implication that the government has claimed somewhere along the line that what you're getting back is what you put in. That I'd like to see some references for.

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An individual earning poverty level wages pays into a system that will, in turn, pay out to a millionaire. That simply does not make economic or ethical sense.


Nothing about the system makes much sense economically, once you enter an era of either flat/near flat population growth or one of actual decline, as is apparently going to be happening in several European countries like Portugal, Germany and Italy in the very near future. And may already be underway in Japan.

But ethically? The system is what it proclaims to be, and operates as it says it does. Since we live in what purports to be a representative democracy, presumably it reflects what the majority has decided they want. I have read some irresponsible claims by a few politicians that social security is "safe" (whatever that means) but I don't see how that reflects on the system as a whole.


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WorldsEdge
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28 Mar 2010, 2:52 am

Orwell wrote:
Black males also tend to have lower income, and thus to contribute less to social security. I'm not sure if that entirely negates the discrepancy, though, and I don't feel like looking up the numbers. If anything, your argument would work better if you framed it in the context of sexism: males earn more on average, so they contribute more to social security, but females live longer so likely collect more.


Not really, since in a white male vs. white female context the discrepancy is only about five years. And a fair amount of that earnings loss is women out of the workforce during the early years of a child's life. And since most people still tend to marry within their own race, I don't see intraracial gender differences as being anywhere near as controversial.

Like you, I don't have those numbers at my fingertips and like you I'm too lazy to go look them up. I might be wrong, but that's how I remember reading it.


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28 Mar 2010, 4:44 am

Orwell wrote:
visagrunt wrote:
Canadians' rates of private savings lag considerably behind our friends south of the border.

How do you managed that? We often have negative savings rates.


I agree. United Stateseans on average and very poor savers. They would sooner go into debt and declare bankruptcy when they can't repay or go to the government teat and suck money out of it. The Japanese are the world champion savers.

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28 Mar 2010, 8:09 am

visagrunt wrote:
There is one, and only one country in the G8 in which the public pension scheme is fully funded. You can probably guess which one. (Given that I am the one talking about it). I contribute about 4% of my earnings between $10,000 and $46,000, and my employer is obliged to match that. In return, I have a legitimate expectation that I will have a defined benefit pension income from the time I turn 65 until my demise. I can live with that deal.

That being said, the United States probably has a stronger social safety net for retirement, generally, than Canada. Even with a fully funded Canada pension plan, Canadians' rates of private savings lag considerably behind our friends south of the border.


That sound like a nice idea, but the problem down here in the USA is....

1. The Social Security fund has no money in it. Government was allowed to borrow against it, so there has really be nothing there for a couple of decades now. Government is obligated to honor commitments, but that means they have a financial crunch when it's time to pay out benefits. If this was any traditional retirement fund, what the government does would be criminal and a violation of every fiduciary standard that exists in financial markets. There would be no reason to believe they'd not do the same with a "federal retirement fund."

2. I like the idea of benefits only for those who need it and everyone pays into the system to help those who absolutely need it, but it will never happen because (i) people will object to not getting their share after paying into the system, and (ii) the mentality of "why should he get some and I get nothing" will have a nice share of lazy people deliberately choose to not prepare their own futures and expect the program to take care of them as one of "those in need." Never mind that some liberal court might rule it unconstitutional to deny benefits to those who don't have need because they paid, hence they are owed something...in spite of how the program is designed to work.



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28 Mar 2010, 10:22 am

zer0netgain wrote:

2. I like the idea of benefits only for those who need it and everyone pays into the system to help those who absolutely need it, but it will never happen because (i) people will object to not getting their share after paying into the system, and (ii) the mentality of "why should he get some and I get nothing" will have a nice share of lazy people deliberately choose to not prepare their own futures and expect the program to take care of them as one of "those in need." Never mind that some liberal court might rule it unconstitutional to deny benefits to those who don't have need because they paid, hence they are owed something...in spite of how the program is designed to work.


In short, you favor well intentioned theft and a good natured protection racket.

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28 Mar 2010, 10:31 am

ruveyn wrote:
zer0netgain wrote:

2. I like the idea of benefits only for those who need it and everyone pays into the system to help those who absolutely need it, but it will never happen because (i) people will object to not getting their share after paying into the system, and (ii) the mentality of "why should he get some and I get nothing" will have a nice share of lazy people deliberately choose to not prepare their own futures and expect the program to take care of them as one of "those in need." Never mind that some liberal court might rule it unconstitutional to deny benefits to those who don't have need because they paid, hence they are owed something...in spite of how the program is designed to work.


In short, you favor well intentioned theft and a good natured protection racket.

ruveyn


I do too. It is a good idea. If you die rich, then you are still dead. Why we shouldn't take the money is beyond me. Their children should start out like every other kid. They will, after all, inherit the business. There is no reason for them to get all that money when they did nothing to earn it. The government should just put it in their savings for the people who actually need it. This goes for everyone, no matter how much they make. Just because your dead does not give you the right to stop paying taxes.


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28 Mar 2010, 10:43 am

fidelis wrote:
I do too. It is a good idea. If you die rich, then you are still dead. Why we shouldn't take the money is beyond me.


Because the money was mine and I have the right to dispose of it (while I am alive) as I see fit. And that included bequests and gifts to persons of my choosing. Apparently you have a difficulty distinguishing between what is yours and what is someone else's.

The main difference between a grunting savage and a civilized person is that a civilized person knows what is his and what is not his and conducts himself accordingly. A grunting save simple takes what he desires.

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28 Mar 2010, 3:27 pm

ruveyn wrote:
In short, you favor well intentioned theft and a good natured protection racket.


Not really, but I can at least appreciate the idea of a moral social imperative that we (as a whole) ensure that nobody is abandoned, so we accept a tax on everyone designed to help the least fortunate among us. Since such a system would never actually work because of the reasons I cited, I'd be opposed to it actually happening, but in a "perfect" world....

Let's be real, if everyone paid $100 a year into a national fund to help those who were utterly unable to care for themselves, it'd not be a totally oppressive thing because there'd be the chance it could happen to YOU, but you can't be selfish and demand benefits because you had the good fortune to not be as messed up as someone else. The idea is that everyone chip in to look out for each other, knowing that while they may never benefit, they should hope that they never need the program personally.

People aren't like that.



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29 Mar 2010, 7:09 pm

WorldsEdge wrote:
DW_a_mom wrote:
But the system we set up to do that never was what the government claimed it was, and people continue to falsely believe they are getting their own money back. We cannot afford to continue the program that way, for it is crippling.


What are you saying the government claimed it was? Everything I've ever read -- and I mean written from the 1930s on -- has simply called it "contributions" for which you receive a "benefit," in reference to the retirement payouts. I'm especially curious at your implication that the government has claimed somewhere along the line that what you're getting back is what you put in. That I'd like to see some references for.


People in my father's generation were sold the idea that the money was going into a trust fund for their future, presumably with their name on it. If you meet with senior citizens from his time, they will tell you that is what they believe they were promised. If the population misconstrued what was told to them, I have no way of knowing, as I don't have all the advertising and speeches ever made on the subject. I can tell you that the sense this was the promise is highly pervasive, and is the reason social security benefits are untouchable politically. Yes, they eventually figured out it wasn't exactly an account with their own name on it, but they did persist in the belief that it was the equivalent of their own money they were getting back.


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30 Mar 2010, 7:45 am

DW_a_mom wrote:
People in my father's generation were sold the idea that the money was going into a trust fund for their future, presumably with their name on it....


+1, and the government keeps hyping that lie. There's even a Social Security "trust fund" (no money is in it) that was created to shore up confidence that the system had the means to pay future benefits, but they've since allowed government to borrow against it.

Ironically, this goes on all the time. Do you really think your bank has YOUR money in it?

NO. Your deposits are used to play the markets. If every depositor demanded their deposits back (or enough of them) any given bank would collapse because the "money" is tied up in numerous projects/investments of the bank. The FDIC insures your account up to a given amount, but all that means is that if the bank goes insolvent, the government will cut you a check for the amount you had deposited. If enough banks fail at one time, the FDIC will collapse unless the government just starts printing money to cover all the checks the FDIC has to issue.



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30 Mar 2010, 7:59 am

ruveyn wrote:
fidelis wrote:
I do too. It is a good idea. If you die rich, then you are still dead. Why we shouldn't take the money is beyond me.


Because the money was mine and I have the right to dispose of it (while I am alive) as I see fit. And that included bequests and gifts to persons of my choosing. Apparently you have a difficulty distinguishing between what is yours and what is someone else's.

The main difference between a grunting savage and a civilized person is that a civilized person knows what is his and what is not his and conducts himself accordingly. A grunting save simple takes what he desires.

ruveyn


Outside of a social context money has no value whatsoever. It is merely either paper, bits of metal, or some sort of promise recorded somewhere and therefore is rather imaginary. Society makes your money valuable and anything society deems a proper purpose for it must be accepted. If you live in a society you must live by its rules.



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30 Mar 2010, 8:17 am

Sand wrote:
Society makes your money valuable and anything society deems a proper purpose for it must be accepted. If you live in a society you must live by its rules.


Production and voluntary trade produce value. One can produce his own value on a desert island without the benefit of society. I suppose if I lived in Nazi Germany I would have to obey the rules of that society and march meekly into the death camps. Right?

You do not raise the question of whether the rules of the society are just or not. One does not have to live under unjust rules. One can fight against them.

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30 Mar 2010, 8:25 am

ruveyn wrote:
Sand wrote:
Society makes your money valuable and anything society deems a proper purpose for it must be accepted. If you live in a society you must live by its rules.


Production and voluntary trade produce value. One can produce his own value on a desert island without the benefit of society. I suppose if I lived in Nazi Germany I would have to obey the rules of that society and march meekly into the death camps. Right?

You do not raise the question of whether the rules of the society are just or not. One does not have to live under unjust rules. One can fight against them.

ruveyn


My statement was about money, not flint arrowheads.



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30 Mar 2010, 10:56 am

ruveyn wrote:
Production and voluntary trade produce value. One can produce his own value on a desert island without the benefit of society. I suppose if I lived in Nazi Germany I would have to obey the rules of that society and march meekly into the death camps. Right?

You do not raise the question of whether the rules of the society are just or not. One does not have to live under unjust rules. One can fight against them.

ruveyn

Drawing parallels between taxation to benefit the less fortunate and mass genocide is quite absurd, to say the least.


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30 Mar 2010, 2:07 pm

Orwell wrote:
Drawing parallels between taxation to benefit the less fortunate and mass genocide is quite absurd, to say the least.


My intent was to show there are just rules and unjust rules.

Paying tax is the rule. It does not mean that it is just. Look at the American Revolution. It started over a tax (the Stamp Act Tax) that was regarded as unjust.

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30 Mar 2010, 5:02 pm

ruveyn wrote:
Paying tax is the rule. It does not mean that it is just. Look at the American Revolution. It started over a tax (the Stamp Act Tax) that was regarded as unjust.

The American Revolution is much more complex than that. There were issues where they felt there were significant miscarriages of justice and arbitrary actions taken against colonists, as well as encroachments on the autonomy the colonies had traditionally enjoyed. Additionally, the revolutionaries believed that the British had been unresponsive to their attempts to resolve their grievances.


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