The Young, Not Seniors, Are Being Dumped off a Cliff

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Politicians’ election prospects are enhanced, the more goodies they can promise and the less taxes they collect to pay for them.

That is why welfare states in Europe as well as here are facing bitter public protests as the chickens come home to roost.

It has been said innumerable times that nobody already on Social Security will lose their benefits. But it needs to be spelled out emphatically, so that political demagogues will not be able to scare retired seniors that they are going to have the rug pulled out from under them.

Retired seniors have the least to fear from a reform of Social Security, since neither political party is about to take away what these retirees already have and are relying on.

Despite irresponsible political ads showing an old lady in a wheel chair being dumped over a cliff, the people who are really in danger of being dumped over a cliff are the younger generation, who are paying into Social Security but are unlikely to get back anything like what they are paying in.

The money that young workers are paying into Social Security today is not being put aside to pay for their retirement. It is being spent today, paying the pensions of the retired generation — and it can’t even cover that in the years ahead.

What needs to be done is to allow younger workers a choice of staying out of a system that is simply running out of money. Nor can the system be saved by simply jacking up taxes on “the rich.”

Generations of experience have shown that high tax rates that “the rich” can easily avoid — through tax shelters at home or by investing their money abroad — do not bring in as much revenue as lower tax rates that keep the money here and the jobs here.

Since the law does not allow private pension plans to be set up in the financially irresponsible way Social Security is, that is where young people’s money should be put, if they ever want to see that money again when they reach retirement age.

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  • Sound&Fury

    Dr. Sowell is right. We are on a collision course with insolvency due in large part because of the non discretionary spending for Medicare & Social Security, together with Medicaid, that consumes 60% of our federal budget. I hold the Democrats responsible for demagoguing this issue, but seniors should also be held to account for their unwillingness to look beyond their own welfare & recognize what these entitlement programs are doing to the younger generations.

    As Walter Williams said in his June 11 article, "… an entitlement is a congressionally given right for one American to live at the expense of another. In other words, Congress forcibly uses one American to serve the purposes of another American." Seniors need to recognize that the entitlements they enjoy come at the expense of younger workers who are required to finance them.

    • dingbat36

      You need to remember that it was the Senate under WJ Clinton which approved the raiding of Social Security funds (the entire fund) which had been prior to that time "a trust fund". It's just another "inconvenient truth" that you can tie to Al Gore, as it was he as President of the Senate who cast the deciding (yea) vote in a 50/50 divided Senate to give congress full access to those funds. NO ONE in Congress has ever made any attempt to replace those worthless IOUs they left in the place of the money they stole, and you can be sure they will neither own up to their theft or their bad intentions of NOT replacing any of that money. They would I am sure, if pressed, tell the seniors (and everyone now having money ripped out of their paychecks) that there is no way to put the money back!!

      This was most definitely a Ponzi scheme but had it been left to grow without grubby Congressional fingers getting into the mix, it would have been healthy for much longer. No one mentions the passing out of these funds to people who never paid one red cent into the program either………….but that's a separate issue.

      • Evaluatoer

        Amen to that. The social security fund and well as the medicare fund have turned into
        a slush fund for social engineering expenditures for " THE GREAT SOCIETY" of the liberal left.

    • Doris Carman

      Thats a crock. If they had used the money paid in by both employee and employers for what it was supposed to be for there would still be money for us.The younger generation of the past 4-5 decades have all been paying in and then receiving checks when they age,.ou sond like its only future generations.

      • Sound&Fury

        Nope, you are wrong. Even if the trust fund had not been "raided", it would still actuarily unsound. While there is currently a surplus, eventually this surplus is exhausted because of the demographic peaking of the baby boomer generation that is just now hitting the system.

  • kathygross

    In capitalism, when you can't find a customer, you lower your price. Even the federal government understands that. The premiums have now dropped by 20% to 40%, depending on your age, circumstance and state. If you considered this pre-existing coverage plan before and found it too costly, give it a look now. best would be to check "Penny Health" for your health insurance

  • Lfox328

    No, those currently retired will get everything their greedy little hearts desire. But the ones like me, only a few years younger, will have to work until we're 70 or older, just to pay for them. AND get less in benefits. A lot less.

    I don't see why they can't take a 5% cut each year for the next 3. They won't starve, just have to give up some of the luxuries that most of us have already had to give up.

    BTW, I'm sick of those who play accounting games to siphon off all their money, to qualify for benefits. Why should their family get all the $ – we, the public, had to pay their nursing home costs.

  • 080

    It's not only social security. As the U.S. more and more resembles the social democracies of Western Europe, jobs for the young seem to disappear. How many jobs were created in Western Europe over the past 60 years? Almost none. Why expect anything different to develop in the U.S.?

  • Fred Dawes

    the young do not care

    • David R.(Canada)

      You may be right. But I'll bet when they wake up, get a job and start paying taxes (assuming they can get off their backsides and get a job), you'll hear the howling.

      Naturally they'll blame the conservative in office who's trying to clean up the mess!

  • David R.(Canada)

    Social Security is too good a cash cow for the Federal Government. The idiots in office aren't likely to end it.
    The biggest problem here is that the people most likely to get screwed are the same ones who are continuously voting for socialism, big government, etc.
    The voting age should be raised at least to where it had been for decades; 21 yrs old.
    Of course, when I look at the maturity of the average 21 yr old I think maybe it should be raised to 30!

  • David

    If the corrupt government wouldn’t have taken the SSI money & put it into the general fund to balance the budget years ago, there wouldn’t be a problem today! Some of those that voted to do that years ago still hold their offices in #Washington DC today! They should have been voted out years ago! This next election, we have a chance to clean house again & vote them out & we can do even more house cleaning in the next elections too!

  • Martin B. Brilliant

    Wrong. The Social Security tax is not too low, it's too high. Social Security is not a savings plan and was never intended to be. It's intended to give retirees some of the products of the economy that would otherwise go to workers. That's done by taking some of the income of people who are still working and giving it to people who are retired. There's no need to put money aside. In fact when more money is taken as a tax than is paid out to retirees, that reduces the total purchasing power of consumers.

    Of course nobody in the private sector could do that because it depends on the taxing power of the government. But traditional pension plans were very similar. As long as a company was expected to continue in business indefinitely, it could promise to pay its retirees' pensions out of current earnings. The first formal company pension plans were established in the 1870s and it wasn't until the 1920s that companies decided that they needed to establish pension funds. The government doesn't need a pension fund because we assume it will continue in operation indefinitely–we might as well make that assumption because if the government fails the Trust Fund fails with it.

    Social Security was intended as a pay-as-you-go plan, with the Trust Fund serving only to smooth over the year to year variations. Lowering the Social Security tax rate and paying out the Trust Fund to retirees would be a stimulus to the economy. Setting the tax rate to match the average year to year payout to retirees would put an end to the practice of funding the government by endlessly borrowing from the Trust Fund.

    Politicians try to scare us about the depletion of the Trust Fund only because they don't want Social Security to change from an asset that the government can borrow to a liability that the government must pay back.

  • Doris Carman

    Hey you probably voted for mr. change. Hows that doin for ya???