I often debate older people on the issue of Social Security. Many of the over 62 crowd believe that no matter what, that they are entitled to a Social Security check.
It doesn’t matter to them (often) that the people now paying for their Social Security checks are much poorer than them on average. No, that check must keep coming. They earned it.
I explain to my elders that even though they paid a payroll tax their entire life to fund Social Security, they weren’t funding their own Social Security. They were funding the Social Security of their parents. So long as the previous generation is smaller than the generation which is being taxed the system can work, more or less. This was the situation with my parents, the baby boomers.
The parents of the baby boomers, the Depression Generation, was much smaller than the generation which spawned the Beatles, Disco, and yuppies. As such the Social Security of the people who fought in World War II was basically doable.
We now have the opposite situation.
My generation is the one in the work force and we are much smaller in number than our parents who embraced birth control and had much smaller families. Yet we must fund the Social Security of a generation which is much larger than us. How is this supposed to work?
Add to this that the people receiving Social Security are much, much, wealthier on average than the current working generation. And we are told over and over we can’t have means testing? That is crazy. You may have “paid into the system” but it’s not like that money was being held in a savings account somewhere. And for all the talk of Congress “raiding the Social Security trust fund,” c’mon.
“They spent my money,” many retirees say “Why should I be penalized? I paid into the system my whole life.”
Guess what? You “paid into the system” for lots of things. Despite what you have been told, the payroll tax is just another tax, just like your income taxes. In fact it really is a form of income tax.
As for “paying in,” one more important point. The average person gets back what they paid into Social Security as Stockman points out below, within 4 years. How, when we have legions of young people coming out of school with massive debt and very limited job prospects can we justify continuing to send checks from the Treasury to well off retirees? It’s economic suicide. Social Security must be means tested. This simply must happen. If you’re poor and elderly the checks keep coming. If you’re driving to the Grand Canyon in your custom $500,000 motor coach with a nice hefty net worth, you don’t get any more Social Security, sorry. And this needs to happen tomorrow.
And young people, every time you vote for a big government person, someone who won’t cut, won’t means test Social Security and Medicare, won’t raise the retirement age, you are taking money right out of your already meager wallet. And remember you must provide for your children from the contents of that wallet. The system as we have it now, with government services such as they are, represent a malignant tumor on our economy slowly sapping our vigor. We cannot continue on like this.