Is Social Security a form of embezzlement?

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"They should" is a statement thrown around a lot that doesn't actually do much. Of course they should pay us back, but that doesn't mean they will. If nobody acts like they owe us, then they don't. Words are free, but actions are costly.

That, and your statement (Orwell) illustrates what went wrong with Social Security. It was intended only for those in need. That people could pay their whole lives and never really NEED Social Security rubbed enough people the wrong way and it was modified to pay out to everyone once they reached a given age, and it gained the status of a federal retirement program...which it neither is nor was created to be.

Kinda like "no taxation without representation" except it's "no taxation without benefits." Social Security was supposed to tax everyone to help pay for the few among us who needed aid. People didn't like it, but, as I've stated, it was never designed to operate as a retirement plan for the masses.

That is a potential solution to the social security problem. Tax everyone, especially the rich, and only pay out to the poor- the rich have more than enough money for their retirement anyways, and they can afford to invest money. Unfortunately, we both know such a solution will not be implemented. It would be political suicide.

That would require Social Security to become something it has never been, indeed, to become the exact opposite of how it was sold to the public back in the 1930s. Namely, as a retirement plan where contributions made determine benefits ultimately paid out. FDR went out of his way to never, ever use the word "tax" to describe the plan, but "contributions" for which you would receive a "benefit."



Actually, you can frame an argument that social security as currently constituted is en bloc grotesquely racist, based upon average lifespans of various American groups. African-american males on average have a lifespan of 69.5 years, white females a lifespan, on average, of 78.3 years. Meaning an African-American male born before 1940 who works for 40 years and contributes to the system the entire time can expect to collect full benefits for four and a half years, while a white female in the same situation can expect to collect for at least 13 years, or somewhere just short of three times longer.

You might be able to quibble with those numbers, as in I'm not sure whether deaths in infancy or at birth or shortly thereafter are included, possibly differences in employment rates or actual contributions, etc., or if there are differences as to when benefits begin to be collected, since there's an option to accept a reduced benefit starting at age 62, etc., But on some level or other I don't see how it is possible to conclude anything other than that black males as a group are subsidizing white females as a group.

Interestingly, the situation for those born after 1960 is even worse, since no one born after that time is eligible to begin receiving full benefits until age 67. So, using the above lifespans as a guide, our hypothetical African-American male will only receive full benefits for two and a half years, our hypothetical white female for over 11 years...only worsening the discrepancy. (I'm ignoring the period from 1940 to 1960, since there's a bizarre sliding scale from age 65 to 67 in place as to when you become eligible to receive benefits, where the earlier you were born the sooner you're eligible. As in someone born in 1941 can't start getting full benefits exactly at age 65, but they will be eligible at a younger age than someone born in 1955. Too complicated for me, plus the sliding scale formula for eligibility has been tweaked at least twice.)

To make this argument, you'd of course need to accept the idea that mere equality of opportunity is not enough, but that equality of outcomes is the only acceptable result. But, as I understand these things, US courts are increasingly sympathetic to the latter idea. I personally don't accept this position, but that's seemingly the way things are headed: ignoring the de jure and going with the de facto. So perhaps we'll someday witness African-American males able to receive full benefits at age 57 or 58 or so, or white females not until age 75 or so.

Edit 1: I forgot to include a link to my data on lifespans. Go here, to page 3: http://www.cdc.gov/nchs/data/nvsr/nvsr56/nvsr56_09.pdf

Edit 2: I made a mistake, but one that only widens the discrepancy. I accidentally used the combined lifespan for whites, not the female-only one. That figure is 80.8 years. Sorry about that, but I'm too lazy to go back through the post and make changes.

Nonsense. The program as it was sold to the public and as it was first enacted, was intended to provide something in retirement to everyone who contributed. And those who contributed more, got more. And still do get more, in fact. Hell, benefits collected were not even subject to any kind of income taxation until 1984. So until that time a millionaire got everything paid out to them tax free, and as of now would still get 20% of all benefits received tax free.



I think you're talking about SSI here. And that has nothing to do with Social Security; its a welfare plan paid from general government funds. True, the SSA administers it, decides on eligibility, etc., but it is funded from a different bucket.

And, actually, there are still quite a few state and municipal employees not covered by social security. How many at this point is an open question, since the exemption depends upon the entities retirement plan, and a bunch of other odd things, like some weird kinds of agreements that I won't even pretend to understand. Also, this provision has only been in place since 1986. Meaning anyone hired by a state or local government before that time probably was/is not covered.



Nope. I don't think it was ever intended to be someone's only income in retirement, but it has always determined payout by amount paid in. Meaning eligibility, at least for retirement benefits, is not now and never has been subject to any sort of "means testing." Bill Gates is as eligible to collect benefits as you or I. Hell, he'll probably get more, since he's presumably been making the maximum contribution for quite some time now. I guess you could argue that subjecting benefits to income taxation is a backdoor way of doing this, but that's not how that got justified legally. In fact, Warren Buffett, perennial # 2 or # 3 on those richest American lists, openly proclaims that he gets his...

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.

No, its called people pay taxes and those taxes get put in a rainy-day fund. Basically so you can retire at a reasonable age and enjoy your golden years. Have compensation in case of a disability that will prohibit you for working and so on. Pretty much so you don't have to work til 90 or go homeless/ bankrupt because of a disability. Its good for a country's people to pay taxes to pay for a program like social security. You pay taxes you deserve to have Social Security to retire at a reasonable age or have an umbrella in case of a bad circumstance.

Oh and there is a bit of fraud in the system but every system has its kinks. Right-Wing nuts just exploit the issue for Political Points, To scare voters and to start a campaign to privatize/ abolish Social Security. Example- Congressman Michelle Bachmann from Minnesota got on Fox News and talked about abolishing social security.

What do you call it when people take the money they have earned and invest in things that they wish to invest in. Or what do you call it when people set aside a significant percentage of their wages, salaries etc and put it in a bank? Why does the money have to be taxed when the owner of the money can invest it himself?

ruveyn

Because taxation properly applied benefits the nation as a whole while those people who have been lucky enough to benefit from the social conditions provided by the nation to have a very hefty income owe the nation as a whole a great deal for those beneficent conditions.

I kind of agree, especially given that now that people are living until 90, the notion of paying for them to live a third of their lives paid for by today's taxpayer seems hard to fathom. Either benefits need to be cut, or the age of joining in has to be raised significantly. It isn't reasonable to have the young to have to pay for grandpa (or whatever geezer name you want to give him) so he doesn't have to work.

What would be better is that instead of giving another history class, or another English class, we give kids a financial responsibility class so that way they know not to fritter away any of their income but rather to keep it.

The alternative, of course, is to see to it that there are no age limits on participating in the economy. But even with your mental skull density you must be aware of how impossible it is to break the age barrier i getting work. Of course, currently, even those well within the accepted age limits are having a profoundly difficult time getting work.

I would call it even if the government stopped taking SSI out of my paycheck and instead allowed me to put that money into my Roth IRA. I get a much much better ROI with my Roth IRA than I ever would with SSI. The trick is called compounding interesting.

Speaking of compounding interest why doesn't the Government invest the funds collected into Mutual Fund Roth IRAs? If they have no funds then can it really be called social "security"?

My proposal for social security has long been as follows:

1) Call it what it has become: a tax and a social program.

2) Adjust the way we pay for it to more closely reflect the reality. Instead of a separate assessment on only earned income to a certain dollar amount, build it into the tax system as a flat tax.

3) Long term, payment of benefits needs to move from automatic to needs based. For the next 20 years or so, we use a transition, wherein each retiree gets back what they were promised, after which their payments end unless there is demonstrated need. What they were promised is what they put in plus investment return. That they get back within approximately 3 years, last I heard. So, everyone gets regular benefits at first. After that, they only get benefits if they show need.

We made a decision as a society, long ago, that those no longer able to work due to age or disability should not be starving to death. It was and is a worthy goal, because no matter how hard someone works all their lives, and no matter how hard they try to save, things happen that are beyond their control. 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. 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.

Although I agree with your attitude and proposals there aare some in this discussion who conceive that their personal wealth is an absolute and unassailable right and they are blind to the obvious condition that they gained their wealth and maintain it only because they live in a social environment that requires from its members a reasonable percentage of that personal wealth to see to it that citizens are well educated and healthy and well informed and that the necessary social and physical infrastructure available to all is formed and maintained. They have a personal and mental set that personal property is an absolute right and should be available only to themselves and an inner social circle and feel no obligation to society in general. It is unlikely that this monstrous selfishness is assailable to reason or appeal to decency as they are basically socially crippled.

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.

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