2018 Won’t See Social Security Reform, But Keep Advancing The Moral Case For Abolition

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January 3, 2018 by Anders Ingemarson

Emboldened by their ability to cobble together a tax reform compromise, early indications are that Republicans may turn to entitlement reform before the 2018 mid-term elections potentially wipes out their control of Congress.

However, Social Security is unfortunately unlikely to make the short list as Senate rules forbid changes to the program through reconciliation—the procedure the Senate can use to pass legislation with only 50 votes. This means that a 60 vote Senate majority is needed for getting a reform proposal to the President’s desk, and we don’t see a red-and-blue Senate kumbaya moment in the cards.

But Social Security has to be addressed sooner rather than later. The only moral end-state is abolition, restoring the respect for our individual rights by removing altogether the shackles of dependency on the government for our retirement financing. We have to tirelessly keep nudging and pushing and advocating to prevent our elected representatives from burying their heads in the sand and to prime the American people for the moral crusade to come.

Reforming Social Security on paper is not a hard nut to crack. As we have outlined in “Separation of State and Retirement” the following three actions would put us on the path towards abolition in relatively short order without unduly penalizing those who are chattel of the current system and dependent on it for their livelihood:

  • Increase the retirement age for instance 1 year every 3 years until reaching the average life expectancy of Americans (currently around 78-79 years). Today’s 67 would become 68 in three years, 69 in six years, etc. Same for ranges of early/late retirement options: 62/70 would become 63/71 in three years, 64/72 in six years, and so on. If you’re 59 today, you’d have to wait until age 71 to collect in full instead of age 67. If you’re 50 today, you’d have to wait until shortly before age 75.
  • Reduce benefits from a certain cutoff date, allowing everybody who is for example 50 and above to collect in full once reaching the retirement age as calculated above. For everybody younger than 50 reduce benefits with let’s say 2.5% per year. If you’re 49 at the cutoff date, you’ll collect 97.5% when reaching full retirement age, if age 48 95%, if 40 75%, etc. That will allow for plenty of time to save up for retirement for those younger than 50.
  • Reduce Social Security taxes gradually to zero after all current liabilities have been funded (assuming the above gradual dismantling).

Combine the above with increased tax deductions for retirement savings and regulatory rollback and we would soon be on track towards total separation of state and retirement. If you think the math doesn’t add up, then make the retirement age increase and/or benefit reductions more or less aggressive.

What will it take to gain traction on liberating us from the shackles of government retirement control? The answer is a sea change in moral sentiment. For the past some 80 years, champions of Social Security have occupied the moral high ground with vague promises of financial security for everyone in old age. But a system that robs Peter to pay Paul is both morally and practically fraudulent.

For example, if you are currently collecting Social Security consider the following:

  • There is no Social Security “trust fund”; the system is “pay-as-you-go.” The funds you and your employers paid into the system your entire working career went to paying for the retirement of your parents’ and grand-parents’ generations. In fact, the program got off the ground in the first place in no small part due to a Supreme Court case (Helvering v. Davis, 301 U.S. 619 (1937)) that upheld the program because “The proceeds of both [employee and employer] taxes are to be paid into the Treasury like internal-revenue taxes generally, and are not earmarked in any way’. That is, the Social Security Tax was deemed constitutional as a mere exercise of Congress’s general taxation powers.” [1] So while the scheme hasn’t exactly been secret, it should make you no less indignant.
  • That no money is in the “bank” (the Treasury) means that you are a welfare case; there is unfortunately no other way of putting it. You are at the mercy of the people who continue to pay into the system and grant you a monthly handout. The only thing separating you from the person with the food stamps in front of you at the supermarket—and from a crushing blow to your self-esteem—is the government depositing your welfare check directly into your checking account giving you a false sense of independence.

If this makes you feel morally uneasy (this doesn’t seem right, does it?) or outraged (this is wrong!) or anything in between, you are now part of the change in moral sentiment that is a prerequisite for reform. You may be dependent on the current Ponzi scheme for the rest of your life, but don’t you owe yourself a fight for reforming the system to give your children and grandchildren the opportunity to live independently off their own savings in retirement, without being at the mercy of their fellow men and the heavy hand of government?

What if you are not yet collecting Social Security? The fact that you and your employer are paying a combined 12.4% “welfare flat tax” (i.e. FICA) to finance other people’s retirement needs and not your own should make you feel morally betrayed; absent a change you will be a welfare case just like today’s retirees—if there is any money left to dole out when your time comes to collect. So much for a “Golden Age.” Do you think this is a moral travesty? Congratulations, you just added a ripple to the moral current we’re talking about.

The time is ripe for retaking the moral high ground for individual rights-respecting retirement independence. Start fighting the moral injustices of the current system. Force your elected representatives’ heads out of the ground. Fight for your individual right to plan and save for retirement and to reap the fruits of your labors in the later parts of your life without government interference. Make the case for organized abolition of Social Security. With just an ounce of moral conviction on your part, you will find that the opposition’s hollow defenses come tumbling down.

[1] Wikipedia: The History of Social Security

8 thoughts on “2018 Won’t See Social Security Reform, But Keep Advancing The Moral Case For Abolition

  1. This seems hopeless. Most people feel they paid their money into the system so they are owed that money in their retirement. But Chile did mostly privatize their version of Social Security.

    • Tom Hall says:

      I think most people today realize that Social Security is a Ponzi scheme, that the money being taken from us is being used to pay the current bills, NOT saved in any kind of “lock box” for our future.

      People may “feel” that they are “owed” the money, but this is probably just a rationalization. People currently dependent on and receiving Social Security probably also feel that they have no “right” to speak out against it.

      I think that the plan that Anders outlines above is something that every moral person can support, including the 50 million plus who are currently receiving it.
      I’d like to see a movement like “Seniors Opposed to Social Security”, to push for a humane phase-out of this system of partial enslavement of the young people in our country.

    • Bill Werst says:

      How did Chile get their politically? Ander’s proposals make sense from a rational stand-point. The challenge is how to persuade politically to begin the shift.

      Anders, the one additional item I did not see in your article is to force earnings statements to show the employer contributions to both social security and medicaid. If citizens knew the actual salary being taken from them is double what is disclosed they would recognize the severity of the ponzi scheme. If you make $50K per year, $6.2K is going to social security. WOW.

  2. dwlievert says:

    Anders:
    .
    My own thoughts on ending the injustice inherent in the current system, begin by making participation in it voluntary. I have not done the necessary calculations so as to determine the iterations of potential monetary consequences of such a move, though I must acknowledge that such a move would have to be part of a larger “ending of injustice.”

    I envision a hard-fast age at which those not having yet reached, would no longer be a part of the plan; an age where one could opt out with the enticement of not having to endure further deductions from their pay; another still-older group that could opt-out with a cash buy-out; and finally, a group who could receive their promised benefits as “advertised.”

    As I indicated, this would be part of a larger effort to return to the responsibility that is inherent with the embrace of freedom. Together with almost limitless ideas that might be enacted concurrently, it should be possible to responsibly liquidate this otherwise impossible indebtedness in a manner whereby persuasion replaces compulsion – such as your thoughts intimate.

    Keep up the great work!

    Dave

  3. Tom Hall says:

    In your opening sentence, you speak of “their ability to gobble together a tax reform compromise”
    People typically “cobble” things together, I’ve never heard it said that we “gobble” things together. I think you’re being mislead by your spell checker.

    • dwlievert says:

      Tom: At the risk of preemptively intruding on Anders’ purview, perhaps “gobble” is a more meaningful term when citing how each of us, in turn, is “gobbling-up” that which is not ours; that which each of us are forced to become – as we “lawfully” become predators without each victim’s consent!

      • Tom: I admit that I always thought it was “gobble” together so I can’t blame the spell check; thanks for pointing it out.
        David: I like your thinking, but being a stickler for the proper use of language myself, I will correct the post.
        Cheers!

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