The Sage Observer

Social Security

I am sick and tired of misrepresentation and misinformation of social security by people who otherwise ought to know better.

Social Security, along with healthcare, unemployment benefits, workmen’s compensation, and other benefits are imperative to the social well being of our nation. They are an absolute must. Social Security is not part of our national budget; money spent for Social Security is not part of our national deficit; and spending for Social Security did not contribute to our national debt–unless investing in our country is considered as such. Those who tell you differently are either ignorant or propagandizing in order to facilitate their own political ends.

The Social Security fund is a stand-alone, self-sustaining employment benefit fund, maintained and financed by payroll deductions and employer contributions. It is one of the most, if not the most, effective and efficient program operated by our government with the lowest administrative cost. At present, this fund is “in the black” with a balance of approximately $2.5 Trillion. However, do not be confused. For the first time in its history, disbursements from this fund have begun to exceed receipts. A combination of increases in disbursements to the newly retired “baby boomers” that have now come of age, a decrease in receipts due to massive unemployment caused by the crash of the financial markets in 2008, and the fact that people are living longer has led to this drain on the fund. Now, there are more people relying on the fund than there are those who pay into it.

The fund is not a lock-box fund. Rather, it is an account on “the books of The United States of America”, the balance of which at any one point in time amounts to the net difference between monies taken in and the monies disbursed since inception of the program. There is no cash in the fund as all money received is immediately invested in securities issued by the government and earns interest at current rates in effect. These securities bear the full faith and credit of the government of The United States of America and are stored at the facilities of the Bureau of the National Debt in Parkersburg, West Virginia (on Avery Street).

Our government has been accused of robbing this trust fund. This accusation is either a downright lie or the result of gross ignorance on the part of the accuser(s), depending on his (or her) motivation. In either event, it is blatantly false. A recent reduction in our nation’s credit rating notwithstanding, the full faith and credit of the United States of America are the highest of any country in the world. Our currency serves as the world’s reserve currency. If you were the manager of $2.5 Trillion dollars in cash, where would you invest it? Would you invest it in a corporation with a lesser credit rating? Would you put it in a safe and just let it sit? Or would you invest it in US Government bonds like is done presently? Other countries of the world invest in our bonds. Why wouldn’t you? It’s the best and safest investment in the world.

In light of the current negative difference between receipts and disbursements of the fund, it is obvious that contributions into the fund need to be increased in order to maintain the fund and secure the future of our elderly and disabled. Of all our many problems in this country, this is the easiest to fix; and the sooner we fix it, the less painful the solution will be. This has been a known fact for several years (the last fix having been done during the administration of President Ronald Reagan), but our elected representatives have been irresponsible and not done so since. What it takes is to completely set aside politics, the bane of our civilization, and just do it. This is a major necessity for the general well-being of our people.

In fact, there are those who want to eliminate Social Security entirely as a function of government and privatize it. These people who think this way are not on your side folks. They are not working for your interest regardless of what they tell you. To no small extent, our nation is in its present financial condition because some planned it this way. They starved the beast. They run up the debt. On the verge of national bankruptcy and in a state of emergency, we are more vulnerable and susceptible than ever to bargaining away our safety nets which are so essential to our nation and to our way of life. I’ll pursue this no further for now, but I ask you to think about something. Where would our country be this very minute if we didn’t have Social Security and these other safety nets? Where would we be at this point in our “Great Recession”? I’ll tell you. We would be in a depression far deeper than our present condition. We are in a great chess game folks; and, in this “behind the scenes” game, we are being taken to the laundry by the power elite, our “Shadow Government”, and our problem is, we don’t know how to play the game.

To fix Social Security, payroll deductions need to be increased and the earnings cap extended to whatever extent is necessary in order to correct the funding. It would be a serious mistake in judgment to cover this expense by any other tax than payroll taxes because to do so would only muddy the water. However, the important thing is to maintain the fund as a stand-alone fund that stands on its own and is not incorporated into the overall national budget wherein it would affect the budget and deficit–as it is now.

Benefits must not be cut and should be adjusted annually for changes in the cost of living–they are barely adequate now. Also, I believe it is imperative that we should not increase the retirement age. According to the report of the FCIC (Financial Crisis Inquiry Commission, issued January 27, 2011), there were 21 million people out of work at that time. I submit to you that many, if not most, of them will never find meaningful work for the remainder of their lives. Now, over two years later, total unemployment remains close to that number (It has been difficult to determine the exact amount); and, frankly, I see little hope for significant improvement in these numbers in the near future. If they can hold out, Social Security will be a life saver to them. . Extension of the required retirement age is very short-sighted in that light.

There are those who want us to go to individual retirement accounts managed by the individual. Any knowledgeable person knows that this simply will not work for the country as a whole. As we now stand, everybody–bar none–are presently free to save and manage their savings at will. In fact, Social Security was established as a supplement to established retirement accounts. The reality is that most people do not save. They don’t make enough money. They plan to save next week, then next month, then soon, but tomorrow never comes. There is always an excuse not to save. Many of those who do save perform poorly at managing their investments or cash them in far too early. They lack sufficient skills or personal discipline. In addition, those cognizant of the markets know their volatility too. There are always a multitude of reasons and/or excuses for not saving; but, in the final analysis, the overall fact is the saving doesn’t get done. We get too soon old and too late smart. Without a safety net such as Social Security, there is only a life of poverty and misery for most to look forward to in their final years. Many will say that’s their fault. They should have better sense. They should have known better. I say to you that that attitude doesn’t help our people, our economy, or our nation. It stifles growth and precipitates poor health and social unrest.

There is never something for nothing. It will cost us; but Social Security is absolutely imperative for the well-being of our country. The alternatives are unacceptable. As I have said, it is not part of our national debt, it is not part of our national deficit, and we should never allow it to be. Social Security has served our country well, and we need to keep it. Let's gitter done people. Let's gitter done now.

Ronald Miller

mtss86@bellsouth.net