GETTING IT STRAIGHT: WHAT SOCIAL SECURITY ACTUALLY IS

[mulethree]

The Moderate Independent - Not Left - Not Right - Just Right

GETTING IT STRAIGHT: WHAT SOCIAL SECURITY ACTUALLY IS

In Order To Have A Useful Debate On “Saving” Social Security, We Have To First Realize What We Are Dealing With

by Thomas J. Bico
JANUARY 9, 2004

Social Security is not an entitlement program. In fact, Social Security is not truly a program of any kind. Social Security is a documenting of a basic reality about America: that the people of America can not and will never in good conscience allow our elderly, regardless of the reason, to lie homeless on the streets.

Social Security is a basic admission on the part of our society that we have certain basic moral values. While younger people many of us believe should stand or fall on their own, as they are fit to fend for themselves, those among us who are too old to work can not be left to suffer without hope for the rest of their lives without food or shelter. Some may have invested poorly, some may never have earned enough to have a chance to save the amount necessary. Whatever the reason, being the good and God-fearing nation we are, it is not possible for us to simply laugh and spit at the elderly man or woman who is without means.

And so we acknowledged this reality by setting up a program called Social Security, the idea being that every elderly person be guaranteed a minimal stipend that assures everyone of at least the basics of food and shelter.

This is never going to change. At no point are we going to become so cold and amoral a nation that we will be okay turning a cold shoulder to a ninety-year old woman lying on a cardboard box, accepting that it is her own fault for not investing or earning better.

-- more --

http://moderateindependent.com/v3i1ss.htm

[brokensymmetry]

1. I hate to say this...but...

This is never going to change. At no point are we going to become so cold and amoral a nation that we will be okay turning a cold shoulder to a ninety-year old woman lying on a cardboard box, accepting that it is her own fault for not investing or earning better.


I'm not so sure anymore. I'd like to believe we're still a moral people; but I suspect we're awfully close to doing exactly what the item above mentions.

Please, convince me I'm wrong.

[Warpy]

3. I don't think you are

I never thought so many homeless people would be accepted, but it happened practically overnight in the early 80s. I never thought homeless women and children would be callously stepped over by yuppies on the way to the office, but it happened overnight in the 80s and is still happening. I never thought poor people would be ignored to death because they had no health insurance, but it's happened. I never thought insurance companies would be allowed to overrule doctors on treatment in order to maximize their profits, but it's happening every day.

There is a nasty, narrow, selfish mindset in this country. People have been told by Lamebawl and all the other bawling right wing howler monkeys that it's perfectly OK to despise the elderly, the poor, the female, the underpaid, the uninsured, and anyone else who isn't a yuppie or wannabe yuppie. The culture has been so cheapened and coarsened by these assholes that it's not worth living in any more.

[Inland]

5. Examples of "privatization"

in Great Britain and Chile have shown exactly that: their privatization programs wiped long term liabilities off the books, but now, they find themselves instituting programs for the poor elderly. So they basically deluded themselves into believing that privatization would do what a fixed benefit pension did do: end poverty. Now they pick up the tab. But for twenty years, their books looked good.

I don't have cites, but I believe this is correct.

[unblock]

9. you may be right. but not for long.

we may yet return to the days of hoovervilles, where the homeless are largely those who made bad investment decisions and couldn't save enough.

but it won't last. while we HAVE social security, we don't have many of the social problems it protects against. once they undermine the program, the problems will reappear. when america is finally confronted with the REALITY of the problem, they will have a much more difficult time saying "too bad, you should have invested better."

the question is, how many seniors must die before we get to that point?

[Inland]

2. It is an insurance program--for us, for our families, and for our society

That's why it is idiotic to compare "the return" on our tax payments with "an average return" on an investment. It is insurance for the case that you become unable to work and are one of the people who fall below the median on investments (and dude, by definition half the investing class falls below the mean). It is insurance that your parents and other relatives don't come live with you.

Do you compare the "rate of return" on your life insurance with a return on the stock market? Are you upset when you don't die? How about the life insurance your parents bought--since they made it okay, then its all wasted money, right? Wrong. It guards against the worst case, since being unable to work due to age (or disability) means you will end up dead or a burden on your family or society.

Privatization means no insurance against poverty. That means there is no reason for SS at all. If SS doesn't provide insurance against poverty, then it really IS useless and should be done away with. Republicans first make idiotic what they would destroy.

[cdsilv]

4. look around any big city

"that the people of America can not and will never in good conscience allow our elderly, regardless of the reason, to lie homeless on the streets."

We not only let the elderly lie homeless in the streets, we let all ages do so.

[Inland]

7. Yeah, but the elderly are different, at least for now

The truly elderly can't work from no fault of their own, and we all hope to live to be that old.

That's why Social Security worked, at least in part: the benefit went to people who were at or approaching the age where they could no longer work, and every worker paid in.

[leftyandproud]

6. can I opt out of this "insurance"?

All of my other insurance is optional.
I'd like out of social security because I KNOW it will not be there for me in 40 years, regardless of who is in charge.

Give me the freedom to opt out and then you can call it "insurance".

Until then, it is compulsory wealth redistribution...No other name is accurate.

[Warpy]

8. Can you drive your car without insurance?

Does your mortgage lender require homeowner's insurance?

Get real. Some insurance is mandatory, which is how the pool is widened to an acceptable level that keeps everyone's rates down.

Oh, but I've disturbed your reading. Go back to your Rand....

[mulethree]

14. You can choose not to drive or have a mortgage

You seem to argue that both are essentially mandatory, But there are millions in the US who have neither a car nor a mortgage.

Some live in public housing and take a bus, Some live on park avenue and take a cab or limo. Some live in retirement communities. Etc.

[Inland]

10. All of your other insurance is optional? Nope.

Actually, all of your other insurances are themselves insured by the state as a matter of law. Your pension, life, disability, etc, all themselves pay part of YOUR premium into another insurance fund. If you insurance company goes splat, that other fund will pay your insurance benefit.

Me, I have compulsory insurance for myself AND OTHERS because I own a car.

There isn't anything about compulsory or voluntary that makes it any less insurance.

The only thing that would make sure that SS would not be there for you in forty years is failing to support it. The only reason why SS wouldn't be there forty years from now is because we let Bush steal it today.

[unblock]

13. there's nothing inherently optional about insurance

besides, "opting out" means that you forever renounce any benefit once you become a senior. and the point of the article is that society will not let you opt out, because no matter how much you want to, society will not permit you to be homeless when your a senior.

bill gates would have to be astoundingly stupid to lose everything, but he could, theoretically, go crazy, donate everything and/or invest it all in something incredibly stupid. he'd have very little sympathy, but society simply couldn't let him wander the streets, wailing about how his accountants tricked him or drugged him and in one bad year he lost it all, or whatever.

that point is, even bill gates benefits, not because he actually gets a trivial amount of cash, but because he can take comfort knowing that, even in that improbable scenario, he'll always be able to afford basic necessities in retirement.

so it makes sense that bill gates, and you, be required to pay in, because the benefit is there, whether you want it now or not.

[stray cat]

11. Good frame for the debate - Thanks

Social security - the practice of moral values

[demon67]

12. I wish that is what it was

If it was an insurance program to prevent poverty among the elderly, we would means test benefits. If it was a retirement program, we would allow for a more balanced investment portfolio. Instead, it is the worst of both worlds -- a safety net that gives benefits to many who don't need it and a retirement program that provides the world's worst returns over the long run. In short, as it exists, it is largely a wealth transfer from the young to the old -- with a diminishing pool of young workers paying the greens fees for an increasing group of retirees.

Simple solution? Make the program what it was intended to be at its inception -- a safety net for those that are truly "old" and truly needy. Specifically, increase the trigger age to reflect that we live, on average, almost twenty years longer than when the program began and means test so that the program is not being drained by those who need no help from the government.

In a system where Warren Buffet receives social security checks, something is very, very wrong.

[deignan]

16. Go for broke

Why not introduce a couple higher tax brackets for millionaires?

[deignan]

15. Symbiosis

Another important aspect of SS is that the relative wealth needed to support out older citizens must be generated by those currently in the workforce.

The government cannot over the long run tax or borrow its way out while maintaining a comparative division of wealth between retired and working Americans. Simply, the government doesn't generate the wealth. It could borrow from abroad but we are already in a bad position on that account. Borrowing domestically puts the problem off a little by promising to repay part of the workforce that lent the money, but that is actually a drain on others in the workforce since the money is diverted from them (money is a promissory note). It is not like the government stores cheese anymore waiting to take it out when the bubble hits (maybe we could store wine and whisky).

So should the money supply or the markets be burdened by this bubble? Is it fair for a small segment of worker to support a larger proportion of retired than what those retired ever had to support? Might a reasonable compromise be struck by government incentives to industry to keep older workers in the workforce? How about more vacation for younger workers? Remember, it used to be that our parents had vacations (and only one worked often). That's not true anymore. Should younger people be upset that they are getting the short end of the stick?