Social Security Is Hemorrhaging Money
It’s more of a feelings game than a numbers game at this point. Fiscal reality doesn’t really matter to the people that only care about how a policy makes them feel.
The Social Security report itself estimates the program will run out of reserves by 2034. To keep it running we’d have to reduce the payments by about 25% at a minimum.
The majority of young Americans don’t believe they’ll get the same level of support that current retirees receive.
Over 75 years, Social Security has an unfunded liability of $13.2 trillion.
We would need to cut benefits by about 17%-25% or raise taxes by a significant amount to keep it sustained.
These are hard numbers. Facts about the future. But that rarely matters to the feelings crowd.
Even with these facts, we have democrat nominees running on a platform to expand social security. They are not just trying to maintain the already sinking ship, but to blast an even larger future hole in that ship.
Expand Social Security = Expand The Sinking Socialist Ship
It is amazing to me we even allow this kind of policy proposal. It’s practically federal level bribery at this point.
These policies deadpan point at senior citizens and say: “Vote for me and I’ll give you money”. Not far off from Andrew Yang’s universal basic income BS. How is that not a form of election bribery? Well, it is. It’s just that no one seems to care.
And the journalists that defend it are even more insane.
A Politicized Journalists Opinion
An article by Nancy Altman in MarketWatch defended expanding social security. It’s an ironic article to read after considering the bribery aspect because it begins by talking about how seniors always vote and are thus are an important bloc to pander too.
This stampede of seniors away from the Republican Party and toward Democrats is easy to understand. The Democratic Party and those running under its banner recognize that expanding and not cutting these programs is not only winning politics, but also profoundly wise policy.
Yes, it is a very smart policy to buy votes by wiggling a dollar bill in front of senior citizens so they’ll vote your way. Who gives a damn about the fiscal health of the nation?
It’s a “profoundly wise policy” because it guarantees votes. Expanding an already failing economic policy is stupid by any other account.
She goes on to claim that:
It is also a solution to the growing squeeze on middle-class families.
Ignorant to the fact that to sustain the failing social security system (much less expand it) would require raising payroll taxes significantly and also reducing total benefits to social security receivers, thus hurting the middle class the most. Only one group benefits: current retirees. Definitely not future retirees.
Each middle-class individual would receive less in benefits because of the need to “expand” it to more recipients. Each middle class working person would need to pay more taxes throughout their life to finance this program. They would almost certainly receive far less than what they paid in.
Social security is paid for largely by payroll taxes. Payroll taxes disproportionally hit the middle class. This is not rocket science.
In a further demonstration of the author’s lack of economic knowledge, she states:
Other financing options include dedicating a restored estate tax to Social Security and increasing rather than slashing immigration.
The logic is horrendous. By the authors account, not only does the middle class need to pay more in tax but they should also face immigrant labor competition further driving down wages.
Sure, immigrants will pay toward more social security for retirees, but that doesn’t help the working middle class at all. It just means they’ll make less over their entire working life because they’re competing with an immigrant labor force.
Yet this is supposed to “help” the middle class. It will certainly help them by decimating them even further so they need even more social programs just to survive.
She then goes on to spout the usual fallacies about taxes:
Expanding Social Security’s benefits while requiring the wealthiest among us to pay their fair share is also a solution to our growing wealth and income inequality.
“Pay their fair share” is so 2019. The top 1% pay nearly 40% of the taxes. That is a fair share.
She ends by saying that:
The future of Social Security is a question of values, not affordability
Which is completely true for the feelings crowd. Sadly, to the people that understand basic budgetary math: the affordability of social security is the much more serious issue that needs addressed.
Say hello to paying a quarter of your paycheck to social security! So you can (maybe) get 1/10 of that money back in retirement at 80 years old!
Why can’t I just keep my own money and finance my own retirement instead of the government deciding when I get it? Oh wait. That’s not good “values”.