This page has been archived and commenting is disabled.
Killing The "We Paid Our Taxes; We Earned Our Benefits" Social Security Ponzi Meme
Submitted by Gary Galles of the Ludwig von Mises Institute,
“We paid our Social Security and Medicare taxes; we earned our benefits.” It is that belief among senior citizens that President Obama was pandering to when, in his second inaugural address, he claimed that those programs “strengthen us. They do not make us a nation of takers.”
If Social Security and Medicare both involved people voluntarily financing their own benefits, an argument could be made for seniors’ “earned benefits” view. But they have not. They have redistributed tens of trillions of dollars of wealth to themselves from those younger.
Social Security and Medicare have transferred those trillions because they have been partial Ponzi schemes.
After Social Security’s creation, those in or near retirement got benefits far exceeding their costs (Ida Mae Fuller, the first Social Security recipient, got 462 times what she and her employer together paid in “contributions”). Those benefits in excess of their taxes paid inherently forced future Americans to pick up the tab for the difference. And the program’s almost unthinkable unfunded liabilities are no less a burden on later generations because earlier generations financed some of their own benefits, or because the government has consistently lied that they have paid their own way.
Since its creation, Social Security has been expanded multiple times. Each expansion meant those already retired paid no added taxes, and those near retirement paid more for only a few years. But both groups received increased benefits throughout retirement, increasing the unfunded benefits whose burdens had to be borne by later generations. Thus, each such expansion started another Ponzi cycle benefiting older Americans at others’ expense.
Social Security benefits have been dramatically increased. They doubled between 1950 and 1952. They were raised 15 percent in 1970, 10 percent in 1971, and 20 percent in 1972, in a heated competition to buy the elderly vote. Benefits were tied to a measure that effectively double-counted inflation and even now, benefits are over-indexed to inflation, raising real benefit levels over time.
Disability and dependents’ benefits were added by 1960. Medicare was added in 1966, and benefits have been expanded (e.g., Medicare Part B, only one-quarter funded by recipients, and Part D’s prescription drug benefit, only one-eighth funded by recipients).
The massive expansion of Social Security is evident from the growing tax burden since its $60 per year initial maximum (for employees and employers combined). Tax rates have risen and been applied to more earnings, with Social Security now taking a combined 12.4 percent of earnings up to $113,700 (and Medicare’s 2.9 percent combined rate applies to all earnings, plus a 0.9 percent surtax beyond $200,000 of earnings).
Those multiple Ponzi giveaways to earlier recipients created Social Security’s 13-digit unfunded liability and Medicare’s far larger hole. And despite politicians’ repeated, heated denials, many studies have confirmed the results.
One recent study of lifetime payroll taxes and benefits comes from the Urban Institute. For Medicare, they calculated that (in 2012 dollars) an average-wage-earning male would get $180,000 in benefits, but pay only $61,000 in taxes — “earning” only about one-third of benefits received. A similarly situated female does even better. The cumulative “excess” benefits equal $105 trillion, with net benefits increasing over time.
The Urban Institute’s calculations revealed a different situation for Social Security. An average-earning male who retired in 2010 will receive $277,000 in lifetime benefits, $23,000 less than his lifetime taxes, while for females, their $302,000 in lifetime benefits approximates their lifetime taxes. And things are getting worse. By 2030, that man will be “shorted” 16 cents (10 cents for women) of every lifetime tax dollar paid.
While those results resoundingly reject “we earned it” rhetoric for Medicare, the Social Security results, with new retirees getting less than they paid in, could be spun as “proving” Social Security is not a Ponzi scheme. However, that would be false. The reason is that Medicare is still in its expansion phase, as with Medicare Part D, piling up still bigger future IOUs. However, Social Security has essentially run out of new expansion tricks, although liberal groups are pushing to apply Social Security taxes to far more income as one last means of robbing those younger to delay the day of reckoning. That simply means that we are being forced to start facing the full consequences of the redistribution that was started in 1935. That is, the current bad deal Social Security offers retirees is just the result of the fact that it has been a Ponzi scheme for generations, and someone must get stuck “holding the bag.”
In fact, perhaps the best description of the current Social Security and Medicare situation comes from Henry Hazlitt, long ago, in Economics in One Lesson:
Today is already the tomorrow which the bad economist yesterday urged us to ignore. The long-run consequences of some economic policies may become evident in a few months. Others may not become evident for several years. Still others may not become evident for decades. But in every case those long-run consequences are contained in the policy as surely as the hen was in the egg, the flower in the seed.
Social Security and Medicare’s generational high-jacking has become “the third rail of politics” in large part because seniors want to believe that they paid their own way. But they have not. They have only paid for part of what they have gotten. The rest has indeed been a Ponzi scheme. And as Social Security is already revealing, the future cannot be put off forever, however much wishful thinking is involved. Some are already being forced to confront the exploding pot of IOUs involved, and it will get much worse.
The supposedly “most successful government program in the history of the world,” according to Harry Reid, has turned seniors into serious takers. The fact that some of them are now starting to share the pain caused by those programs does not contradict that fact. It just shows the dark side of the most successful Ponzi scheme in the history of the world.
»
- 43869 reads
- Printer-friendly version
- Send to friend
- advertisements -
Miffed: No worries about the homing pigeon. I'll provide the bird.
As for BC growers, they're a friendly bunch. They don't want trouble, neither do we. Doubt they would even attempt growing in our location. Too remote, too many mountains and sunlight being an issue. No helicopters and only 4x4's and my 2 wheel drive truck gets in (with winch support if needed).
We'll figure it out.
+1
Good story. There was an article in the LA Times web edition. It was about Northern Calif dope growers. A husband and wife who grew "organic" pot. They were complaining about competition lowering prices.
The whole article and the comments were hilarious. Leftys growing an illegal plant complaining about competition. They said they could take expensive vacations before prices dropped. The LA Times writer was writing the column like they were some victim of this evil force known as competition. Poor dopers.
Some wag posted a comment about pot being a WEED. This why they call it "weed." The wag said the idiot husband and wife were acting like they were raising prized truffles or a fine wine.
I wonder if it is harder than growing (lawn) grass. My lawn grass always grows well where I don't want it to grow well. LOL!
I had a fantastic lawn in the UK, and grow a couple of small Mohan Ran every year for personal consuption now I'm in Spain. I can honestly say if you are on a low enough parallel growing great weed outdoors is far easier than an immaculate lawn.
Still miss the putting green I slaved over for years, but its about the only thing about the UK I seriously miss.
Hey Miffed & Yen: What do you think about this... no shit I'm driving back from a jobsite today and the talk radio gurus are on. The guest they had says it's time to END senior discounts at stores. He says the boomers have affected most of the world changes for decades. Approx. 500k boomers will be retiring every year, for the next 20 years (I'm going by memory here).
Retired Boomers will be the biggest customer base, have the most disposable income, etc, etc. Why should they get the preferred discounts at every store they walk in to? He used a small example of a local theater group that offered senior discounts to watch stage performances. When they took a poll of their audience they found that ALL of them were seniors. They immediately stopped the discount.
Sorry. long day of outside work in the cold. I think I'm coherent enough that you get the picture?
Angus , I think the older boomers get it. The younger boomers are fucking worthless! I'm GenX and have always been in the minority when it comes to politics.
People that deserve entitlements, are the ones that don't want it , but are forced through Ber'nank'en'stein'ian monetary policy, to do SO!
Bitchez!
Yen: To quote Seinfeld... "No 20% soup discount for you"!
Edit: Yeah, the older ones do "get it". I have a family member who is 18 years older than me and I saw his entitlement phase many years ago while he was a multi-millionaire. Made me gag and puke. Haven't spoken to him since around 2004 so no idea how the 08 crash affected him. I'm sure he's doing fine.
At 52, both my husband and I do get it. We were the minority watching the older boomers get a lot of benefits ( cheaper housing before the bubble, management positions). We identify more with the GenX crowd. The other day I had a 67 year old laud the Clinton years budget surplus and how the roads were better maintained. I explained that wasn't a surplus and in fact he should realize those paved roads were his supposed retirement fund. He just stared as me gape mouthed.
Miffed;-)
I explained that wasn't a surplus and in fact he should realize those paved roads were his supposed retirement fund. He just stared as me gape mouthed.
LOL! That would have been fun to see. Much of the Clinton budget surplus was Y2K BS and dotbomb scam that Wall Street and Sand Hill Road (venture capital in Silicon Valley) "engineered." Obama has used Clinton's market pumping recipe.
Anyway, if you don't think the stock cap gains from IPOs do not count, well Calif counted all their gains in their budget for FaceBook's IPO. Well when it blew up - that screwed up the budget. They already had budgeted that money BEFORE the IPO!
So O and his HFT Algo buddies have had to pump up FB plus all the other crony pal companies stock including Yahoo. In the 1970s, the hyped Bubble Stocks were called The Nifty 50. These shitbag companies should be called the Obama 30. All pumped up like FB, Yahoo, AMZN, GOOG, and all the other NSA/Obama friendly crony capitalist companies.
The senior discounts are there to get them in the door. Seniors love getting a good deal. Plus they're the only ones with money.
Wen_Dat: Yep, I know why the discounts for seniors are there. I'm not quite 50 yet but the first thing I say to sales staff anywhere is, "do you have a seniors discount"? If they don't give ME the same deal I walk out.
SS is worse than a ponzi because in a ponzi at least you had a choice to be a fool and go for the scheme.
There is one thing that politicians, grifters, con men, scammers, confidence men, and ponzi schemers have in common. They take your money today and promise to return many times that amount later.
While I will be the first to admit "we was robbed", this fucking pisses me off that some "smarter than fuck" asshole can submitt this piece of trash, trying to tell me that after contributing close to $250k into this scheme that I am somehow fucking anyone, having not drawn a single dime from it. If you want to suggest that it is possible, and likely probable that eventually, I along with others, will eventually end up robbing younger generations based on our contributions, you are welcome to do so. But it hasn't happened yet by a mile for most of us and there is nothing but talk of needs based payments, effectively converting SS into welfare. Yes, we have all been well fucked here but I'm fucking sick of this constant divisive bullshit, when it is those directing policy, the ones who are self described guru's of social science and high finance, who has driven the shit off the cliff. Tell us its broke, that all the money is gone. But don't fucking tell us WE are the ones who fucked it! Not a fucking dime...none, nada, zip of that money I have paid in has come to my pocket. FUCK YOU!
I pay in each month about what my mom takes out. I know I'll never see a dime, but so what... my money's at least helping my mom. Her generation paid into a PONZI and were lied to by politicians who were also being lied to. I can forgive their ignorance, even up til 5 years ago... but NOW? Hell no! There is ZERO reason for any intelligent person to see the math and still claim the system is solvent. Math is math. It'll get paid with printed dollars, UNTIL the dollar dies.
Milton is alive and well!! I love when people talk about the massive unfunded liability. Any debt which the funds don't exist to pay at the time, is an unfunded liability. Home loan, unfunded liability! Car loan, unfunded liabilty! I have respect for people who tell the truth to support an arguement but do not respect people who misrepresent (called lying) to push their agenda. I come to this side, occasionally, to see if the same old crap is being pushed and it is.
Oh, its the tiresome Mises misers out representing those billionaires again. Lets just take the money making business out of the hands of the banksters and let quantitative easing take the form of a citizens dividend, used first to pay off personal debt, from sovereign currency issued by the treasury. The federal reserve can be an agency of the treasury. Cut the banksters out of the loop and take away their vig. The game is so tiresome. Kucinich's NEED plan needs exploring. But the Mises misers will still spiel their propaganda, for their corporate masters.
"To ensure sufficient liquidity to the banking system before infrastructure expenditures are able to work into circulation, the Treasury Secretary would make recommendations to Congress for a tax-free Citizens Dividend granted to all U.S. citizens living in the United States. Within 180 days of passage of the NEED Act, the Treasury Secretary would also be required to make recommendations for the interest-free lending of United States Money to state and local government entities for infrastructure improvement, based on per capita amounts as determined by the Monetary Authority."
http://en.wikipedia.org/wiki/NEED_Act
As far as social security goes, the easy answer is to eliminate the income cap. Let the royals pay their fair share.
Kucinich, eh? you must be one of those political sages.
If you decide to collect the wealth of those "royals" to feed the mass of non-savers, you won't have any "royals." They'll be living in other countries and milking the US government for all it's worth, still buying the Congress via contributions by companies they control. Think of a better path, because milking the royals won't work. In the US the most severe problem is the cost of total taxes and the service professions. Medical insurance alone, for a family making 100K per year, is about 21,000. In Europe, and certainly in asia, 5 years of that 'tax' would pay for a life time of new knees and a bipass operation. All the rest? The suckage of the vastly over-priced US health care industry: device makers, physicians, insurance co's, and big pharma. What I have paid in the last ten years would be a lifetime's cost in France or Germany.
Last I heard Romney still lived in the US, and the stinkpots at Bain Capital sheltered about a billion dollars transferring from their fixed fee to carried interest deferred taxes forever scam.
As long as the ****offs are writing the tax code, best option is not to participate.
For the unknowing, a stink pot is the pot old folks would use to take a dump in at night rather than take a hike out to the outhouse.
all of these programs will be done away with and bundled into edible Federal Government wafer, mmmmm.
I read every single comment..and not one mention of public pensions being so much more a ponzi plus unfair and colluded against those on SS.
Have the Gov "convert" all public pensions to SS. Problem solved?
How 'bout all those who paid into the system and died before they drew ANY benefits (as noted by poster "Toady")? I don't hear you stammering about them, Gary, or the fact the U.S. Government has been dipping into the SS fund for years now to fund current operations, leaving just a stack of worthless IOU's instead of bonds or T-bills. Eliminate the salary cap and, presto, any SS funding problem is resolved. Instead of trying to cheat old people by invented financial gyrations (chained CPI), we need to provide those on fixed incomes with annual increases that match reality, such as meat prices of $4 a lb and gas at $3.50.
West your wrong SS is not a Fund. For the last two years the treasury sec. has been writing bonds to cover the short fall. Also the average age of the person receiving benefits is between 48 and 54.
http://usa-the-republic.com/mark%20of%20beast/Chap5.htm
http://www.heritage.org/research/reports/2012/04/social-security-finance...
http://www.uschamber.com/issues/retirementpension/socialsecurity/trust-f...
//Totally uninformed. Social Security contributions were put in the new "unified budget" by Lyndon Johnson to conceal the deficits arising from the Vietnam war. But that did not end the Social Security Trust Fund which now contains over 2 trillion dollars of Treasury Bonds which have equal claim against the full faith and credit of the US government as do the Treasury bonds held by China, Japan and Saudi Arabia.
Molineaux, he isn't misinformed, but has a different perspective which agrees with mine: If the government collects SS taxes, but then lets another branch of the same government borrow the money and spend it (issuing a T-bond IOU), then the government has, in relation to the taxpayer, saved nothing in any fund, net. They collected the taxes and spent them. That means that the amounts will have to be paid all over again by other future taxpayers....who will also be paying social security taxes in the years they are repaying all those IOU's. It really is that simply.
Hey dipsh!t, if you lift the "salary cap" SS just becomes another god damned welfare program. Fact is that most of the super wealthy do not have much earned income. But guys like you don't understand that now do ya?
Ground beef is $5.00/lb
Ground beef is $5.00/lb
comment is free
If you like your ground beef, you can keep it!
BS
JUST CAUSE YOU FEEL IT ..... DOESN'T MEAN ITS THERE.
Yeah kid, your first paragraph pissed me off, and I didn't read further. I haven't read the other comments either, but I'm gonna say this;
Is it the Mises Institutes' position that since we didn't know we were being duped for several decades, we are now complicit?
Is it the position of the Mises Institute to lie and claim that seniors, and not bankers, were the primary beneficiaries of the ponzi?
From your first paragraph, I knew you, and you are still too stupid to realize that what has been claimed has now manifested itself real, through you.
To wit: The Mises Institute is a tool of the Rothschilds. End of story.
fonestar I'm pleased you're doing well with BTC. I did well on the Yen/Crosses last week.
Start a thread in Z/H chat. You're comments have NOTHING to do with financial or geopolitical events , in the near future.
BTC isn't a sovereign currency, store of wealth, or "backed in faith" Eg; real property/land alternative...
excuse me, my bladder is full.
How about Killing the "I'm an Ivy League, Wall St., LIBOR rigging, Gold Rigging, Insider who cheats, lies and pretends to be an upstanding "good guy" who wins becuase he takes such 'risk'" Ponzi Meme....? Anyone? Who am I kidding...nevermind. Go millenials! Boo, boomers!
If these folks are so adamant about the fact that "I paid into it, I deserve it", then fine, liquidate the whole GD thing, cut checks to everyone for every dime, "OH" they will squack..."that is much less than I was expecting" For the rest of us under 60 we will be cheering.
An old fart was telling me how great medicare was and he said everyone should have it. I said, "you do realize it currently is a hundred trillion dollar liability, right?" "Do me a favor. Just shut the F up, keep stealing from your Grandkids, and die already."
My parents used to talk like this (although not so viciously), until they reached 65 and became eligible for medicare. After a few months they realized the value of it and changed their opinions completely. I hope the same happens to you when you reach retirement age.
So what you are saying is - once you get the taste of the free shit in your mouth you quickly start to enjoy the flavor.
Everyone loves the lotto when they win. The millions that bought the losing tickets, not so much. It is the same for every insurance ponzi. You always buy in because your goal is to get more than you put in. And, as it always has been and always will be, its mathmatically impossible.
Another von Mises disciple spreading Austrian dogma. I am sure that von Mises himself would not have been so rigid in attacking a program that is Yes, Yes an insurance program. It is insurance against living longer than one's resources last. Everyone has to contribute in insure against the grim reaper when no one knows when he will swing his scythe. And like responsible citizens in a just polity, almost all of us recognize the necessity and justice of such arrangements. It is only those few who, having accumulated more than adequate resources, are so mean spirited that they would deny the ability of the rest of us to protect ourselves collectively. What seems to inspire the unlimited hatred of the priviledged few is the fact that it is run by the government and requires all to participate. The government in a democracy recognizes that the general welfare requires all of us to protect not only ourselves, but also the sick, the weak and the poor. This is simply the expression of Christian principles in the civic realm.
If that meme doesn't work how about these?
LBO's shafting pensions = privatizations shafting
Social Security.
The very expression Emergency Manager resonates
with Hank Paulson's hyperventilation act and this
(warning: graphic)
http://www.youtube.com/watch?v=SWksEJQEYVU
http://www.ajconline.org/article/S0002-9149(13)00896-5/abstract
Maybe but for the judgmental b.s.
from this
http://www.huffingtonpost.com/brendan-demelle/study-confirms-tea-party-_...
we'd be less worried about upside down
populations.
Add:
http://www.nj.com/mercer/index.ssf/2013/11/military_update_veterans_coul...
http://www.reuters.com/article/2013/11/18/us-usa-pentagon-waste-specialr...
How much will replacing the food chain
set us back, whether or not we bother
with trust busting vs. settling for
the "next seed?"
http://www.multiurl.com/la/Also_Some_Kids_Sent_Into_Inescapable_Debt_For...
http://www.pnhp.org/news/2013/may/Private-insurers-Medicare-Advantage-pl...
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2_71Klo2vig
http://www.pnhp.org/news/2013/april/obama-administration-intervenes-to-g...
We need Dave or some other non-privatizer.
http://www.youtube.com/watch?v=Vkf4VQx2MHE
Government/Keynes take false
blame for programs that are
pre-texted privatizations and
pre-texted with Simpson Bowles
type cost braking.
For instance, where monetary policy
reflects the fact of TBTF being
privatizing the profits and
socializing the cost, this
follows:
So, For Instance, The Beveridge
Curve
http://en.wikipedia.org/wiki/William_Beveridge
(Job Openings Vs.
Unemployment Rate, A Measure
Of Market Efficiency And Sensitivity,)
May Reflect Uncertainty, But The
Basis For That May Be Read Wrongly.
I Think It's Reflecting Not Uncertainty
Caused By People At The Receiving
End Of The Blame Game, But The
Expectation Rates Will Rise.
That The Liquidity Preference
Reflected Only Makes Sense In The
Presence Of Uncertainty Is
Confirmed By That Very Expectation,
In Turn Confirming John R. Hicks’
https://en.wikipedia.org/wiki/John_Hicks
Commentary As To Uncertainty.
The Banks Themselves Took
A Pass On The Liquidity Trap
Created For Themselves.
http://www.bloomberg.com/news/2012-07-09/dealers-decline-bernanke-twist-...
These things reflect privatization.
It's really quite endless.
Certain European Nations
Have Virtually No Homeless People.
This Fact In Housing Parallels
Comparisons In Health And Education.
Considering The $US Trillions
Lost To Dubious Purposes, Not
By The Homeless, The Vulnerable
Or The Falsely Blamed, The U.S.
Public, When Not Deceived By
Puppets, And With Uncorrupted Economics And Legitimate Equality
Of Opportunity, Can Easily Rejoin Those Peoples In The Common
Goal Of Seeking A Happy
Human Condition.
Jesus H. Christ, work on your communication skills. Go to Toastmatsers or something.
Love Von Mises Institute, but gotta call a little bullshit on this article for not pointing out that people (e.g., boomers) contributed in 1960 pre-inflation dollars and are/will be getting destroyed with payback in inflated USD benefits and death panels. A 1964 $30,000 salary was equivalent to $210,000 in 2010, and @ 15% of said 1964 salary you could buy yourself over 100 gold oz coins then, per year... if TPTB allowed it, which they did not, until the early 1970's.
Point is, if people could/would have saved 15% for themselves in PM's (real money) stacking coins over the course of 40 years they would be multimillionaires in USD right now and have little worries.
The boomers will be eating dogfood because the promises cannot possbly be kept to their generation. The Death Panels were invented just for them. Boomer generation was used as propaganda in the 1960's to advance more welfare Ponzi schemes when the math looked good and the pyramid was not inverted. Today's situation was completely forseen.
Friedman pointed out long ago that people would be far far better off with making their own 15% contribution to themselves and investing it. Businesses would be able to hire more people without having to pay the SS employee tax, and individuals would have control over their own money and retirement in sound money.
End the Fed and currency monopolies.
Stop talking this foolishness! Working and saving can NEVER compete with something for nothing. This constant sales job by the "brilliants" of the world have brought us to this. What is sad is those who were saving are now finding they are footing the bill for all those who lived the grasshopper's life. Not only will their SS benefits be cut or eliminated because they don't "need" them, they also find their hard earned saving worth considerably less than when they earned them and unable to earn any additional returns that might barely match devaluation unless they are willing to take their cash to the casino, knowing full well it is rigged and only luck will prevent it from all being stolen.
The boomers are doing OK for the most part and will probably continue to do so without ever having to taste dog food. Those of us under 50 will not be as fortunate.
We're all screwed pal. The younger have a longer time to be a part of that 'greatest wealth transfer in history'. Buy real stuff!
Yes, we might all be "screwed". But from ancient times through today every civilization had about 15% of the population that did fine and the remainder were serfs who lived a precarious existence. There were stretches of time such as in Europe after the plague rolled through where labor was scarce and serfs could become fat and happy. Here in the US we are coming down off a trend where the serfs will need to continue to adjust their expectations. Europe was destroyed after WWI and II and we experiences disruptions which allowed us to experience great affluence. Those days appear to be over.
Most people were never in the game, but thought that they were. Hence the anger.
The confusion is because people think it is insurance when it is not. People can scream social insurance as much as they want, but social security is no such thing. Social Security is a tax, period, end of story. Nothing else. There is no contract, the money taken does not go to an account to be held for you, there is no contract, no insurance, no annutity.
It was all a show. Look at the courts findings, look at the Congressional hearings with the actual people who set it up. It was a tax only, if you happen to get something it is called a gratuity of Congress. That is all it is.
Here is the concluding remarks of the hearing:
At pages 1013-14 (the Chair's concluding remarks):
"Chairman Curtis: Mr. Altmeyer, it is apparent that the people of the country have no insurance contract. That does not mean that I do not want to do my full part to do justice to them and to carry out and make good on the moral commitment that has been made to them. Yet, notwithstanding the fact that they had no insurance contract, it remains true that the agency under your direction repeatedly in public statements, by pamphlets, radio addresses, and by other means, told the people of the country that they had insurance. I think a number of people were misled by that."
Source: 1953, subcommittee of the House Ways and Means Committee conducted hearings for the express purpose of settling the question of whether social security was contractual in nature; see Hearings of November 27, 1953 entitled "The Legal Status of OASI Benefits," (Part 6). The witness at the hearing was Dr. Arthur J. Altmeyer, who held several offices in the Roosevelt administration. He was a member of the first Social Security Board, and by 1946 became the Social Security Commissioner, retiring in 1953. During this hearing, various parties stated that social security was not a contract:
99% don't want to understand this, and so they won't.
those old people contributed gold dollars. real gold and silver dollars.
what was the purchasing power of those gold dollars compared to what they can buy today?
They paid in with gold dollars, and they get to withdraw benny bucks. You tell me who got the better end of that deal.
When they paid those gold dollars to Social security, a car cost what 3k, a house cost 16k. those people paid in fair and square, and they are taking out worthless b bucks that can barely purchase GMO bread.
z hedge readers of all people should already know this. for shame. how many have contributed to SS when gas cost one buck a gallon before 2000. what does gas cost now? what will it cost when we newer generations acutally retire.
i don't get z hedge readers, the hedge funders and the banks get ten of trillions in benny bucks, but old people and people that work at walmart aren't eligible for benny bucks i guess huh.
merry xmas.
The elites telling the tax payers that "You didn't pay that tax". Hey elites "Fuck You!". Social Security has always returned a massive surplus over benefits paid. But hey, you spent it on Vietnam, Iraq, the cold war and Afghanistan, now you turn to seniors who paid that surpls and call them takers? Go fuck yoursleves and lie somewhere else where the reader is too stupid to see through the tansparent desire to steal the rest of the SS money. Cunts!
I have always thought that having 15 (whatever) people paying in for every person collecting SS turned out to be a problem.
You could collect a really small % from each and still end up with extra tax revenue left over.
So it was easy to throw extra programs like disability on top - easy to jack up the benefit payment -
Not looking so great now that we only have 3 people paying in for every person collecting -
What does congress always do if they have extra cash? Spend it and borrow more to spend.
Do not ever become worth more dead, than alive.
Michael Jackson RIP
What a disservice to the memory of von Mises to have penned a class warfare attack under the name of the Mises Institute when almost every fact is incorrect or prejudiced.
First of all, Social Security was a forced promise made to Americans by a Leviathan government that had no intention of fulfilling the promise. And under the threat of police power, Americans were channeled into this system through all their working years. And, now, when the bankers are forced to spin the lie of low inflation to deny recipients cost of living adjustments (COLAs) and the tyrants and socialists who run the government have brought in illegals, a Mexican population half the size of Mexico’s, Medicaid welfare recipients and drug addicts to add to the Medicare rolls, the Paul Ryans now step forward to enlist the young, who weren’t there in the beginning, to say “Let’s just not pay.”
And it’s the young with billions of dollars in tuition debt, many jobless and living at home with their baby boomer parents, getting their spending and lunch money from their parents and grandparents, whose inheritance is being eaten away by the government's transfer of their parents' wealth, who Galles pretends is hostile to SS recipients when everyone else knows it's the bankers -- the Rubins and the Druckenmillers.
“Notice how there is no and there is never a discussion of welfare or food stamp cuts in the USSA? Where is the rollback of government welfare in Cyprus... there isn’t one..... nor will there be one, they will clean out your bank account to feed the dole roles....”
That’s how gatorengineer put it back when ZH’s monthly kill-SS-now-that-boomers-are beginning-to-retire spiel rolled around this past March. And I would llike to throw in the mix the burgeoning benefits to government employees, the Mexicans and illegals who never paid in a cent, plus a large portion of Medicaid recipients and, of course, the numerous drug addicts.
The takeaway to remember is that the SS idea belongs to the bankers who engineered it and do not want to pay up.
As for Galles’ comment that “One recent study of lifetime payroll taxes and benefits comes from the Urban Institute, here’s a lowdown from Wikipedia on the Institute (and it ain’t pretty):
“Today, federal government contracts provide about 55% of the Institute’s operating funds, foundations another 34%, and state and local governments and private individuals the rest.[4] Some of the Institute’s more than 100 private sponsors and funders include The Atlantic Philanthropies, the Annie E. Casey Foundation, the Ford Foundation, the Robert Wood Johnson Foundation, the Henry J. Kaiser Family Foundation, the Charles Stewart Mott Foundation, and the Rockefeller Foundation. …
“The Institute also houses the Urban Institute -Brookings Institution Tax Policy Center, the National Center for Charitable Statistics and Urban Institute Press. In 2010, the Institute conducted research related to all 50 states and roughly 25 countries.[5]…
“Unique among the nation’s largest research organizations, the Institute is 63% female, and five of the ten research center directors are women. As of mid-2011, 27% of the Institute's staff is composed of people from a racial minority.[7][broken citation]
“100% of the Urban Institute's employees' political donations between 2003 and 2010 went to Democratic candidates for political office.[8]
Board of Trustees
“In 2011, Board members are: Joel L. Fleishman (Chairman), Robert M. Solow (Vice Chairman), J. Adam Abram, Afsaneh Beschloss, Jamie S. Gorelick, Fernando Guerra, Richard C. Green, Jr., Freeman A. Hrabowski, III, Annette L. Nazareth, Melvin L. Oliver, Joshua B. Rales, Robert D. Reischauer, Jeremy Travis, Anthony A. Williams, and Judy Woodruff.”
In addition, this article is riddled with prejudice such as its failure to factor in that when a person who dies has no surviving spouse or children who would qualify for Social Security survivors benefits, all the money he paid in during the his working years remains in the Social Security trust fund.
Galles also failed to recognize that after a certain income many SS recipients pay income taxes on most of their SS. And for Galles to say that “benefits were tied to a measure that effectively double-counted inflation and even now, benefits are over-indexed to inflation, raising real benefit levels over time” is simply an inflation lie.
And the main reason for the inflation lie is so that the government and the conniving bankers don't not have to pay what they owe.
Americans are victims of the social security lie; yet the author of this article acts like they are the perpetrators. And in that the author is a professor at Pepperdine University, perhaps the author could give us a rundown on his retirement benefits?
http://en.wikipedia.org/wiki/Urban_Institute
You could not be more mistaken than when asserting that the SS system was the bankers idea. From its inception, the bankers and their allies have been trying to destroy Social Security in the US. There is plenty of evidence for this behavior right here in zero hedge. But, fortunately, this is a minority view. The overwheming majority of US citizens support SS and want it to continue.
Of course they support it, as long as they think it will pay out. Gambling used to be illegal until the governemnt decided, as they did with booze, there was too much money in it to ignore. Today, how many are against the lotto? How many actually win? Of thsoe that win, what percentage of the actual contributions go towards the winnings? There is ever only one reason for governemnt to do anything and that is to gain money and the power it provides. We will see drugs legalized soon for the same reason, money and power.
Workers are forced to pay SS. If they had invested that money they would have expected a nice return(remember the days of 6%,8% interest on savings? I do) to retire on. They would expect more than they put in. Of course they want and expect and demand their SS. A person would not be normal to not want their money. Who would say, 'oh, this is a ponzi scheme, it won't work, cut my payments down to next to nothing.' We needed a congress full of Ron Pauls to say 'no' and stop the insanity long ago. It could have been done.
I agree with much of what you say, but it doesn't matter that we payed for this. Like Bernie Madoff's customers, we were robbed. And while it is possible for the government to tap off of future workers (assuming there are any) it will be significant. If we want to survive our old age to a passing of more or less our choosing, we best not make too many demands of the young, for with the power of Obamacare we can be legislated out of existence. Handicap buses will be showing up at our door to deliver us to "free" healthcare analysis, from which most of us will not return. The country is broke and those who drove us into the ditch are looking for scapegoats and old folks will be an easy target. Conservatives and others can stamp their feet demanding financial justice and will only put an ever larger target on their head. The sooner we accept we have been fucked, the sooner we can find a real solution, because the stolen money ain't coming back. This post only proves the point. They are pointing fingers...at boomers. Take cover and plan strategically.
Henry Morgenthau, Jr., Roosevelt’s secretary of the treasury and financial advisor, played a major role in designing and financing the New Deal, RMolineaux. Says Wikipedia: “His biggest success was the new Social Security program." It was Morganthau who helped FDR set the gold price.
Yes, the American people want to get what they paid for, to receive back the full buying power plus a normal investment return on what they were forced to pay into SS, as well they should. And that’s my point. And it is true that the bankers currently are active in SS, reference Bob Rubin’s and Lloyd Blankfein’s continuous campaign to privatize Social Security funds while at the same time reducing benefits.
Big government ultimately destroys the private sector. Every cent of our money supply comes into being for the purpose of being loaned to someone, including paying for the national debt. Ultimately, this debt is used to mire the country in socialism. The goal of the Council on Foreign Relations is the deliberate weakening of industrialized nations as a prerequisite to bringing them into a world government, built upon the principles of socialism, with the bankers in charge.
And the looting of SS since 1987 has been relentless.
The “borrowing” by Congress from the Social Security trust fund (see link to chart) from 1937 on up to 1950 was practically zero, rising to no more than $20 billion on up to 1967, hitting about $75 billion in 1975 and dropping to $30 billion or less in 1985. But in 1987, the looting of SS took off like a rocket ship - shooting straight to the moon from about $45 billion that year to about $870 billion by 1999. And the rest is history.
The following excerpt from the 1998 Senate Budget Committee session is between U.S. Federal Reserve Board Chairman Alan Greenspan and U.S. Senator Ernest F. Hollings (D-SC) and was reported by whatreallyhappened.com. in an article entitled THE LOOTING OF SOCIAL SECURITY TO BALANCE THE FEDERAL BUDGET : _______________________________HOLLINGS: Well, the truth is...ah, shoot, well, we all know there's Washington's math problem… What we've been doing, Mr. Chairman, in all reality, is taking a hundred billion out of the Social Security Trust Fund, transferring it over to the spending column, and spending it. Our friends to the left here are getting their tax cuts, we getting our spending increases, and hollering surplus, surplus, and balanced budget, and balanced budget plans when we continue to spend a hundred billion more than we take in.
That's the reality, and I think that you and I, working the same side of the street now, can have a little bit of success by bringing to everybody's attention this is all intended surplus. In other words, when we passed the Greenspan Commission Report, the Greenspan Commission Report only had Social Security in 1983 a two hundred million surplus. It's projected to have this year a 117 million surplus. I've got the schedule I'll ask to put in the record the CBO report: 117, 126, 130, 100, going right through to 2008 over the ten year period of 186 billion surplus. That was intended; this is dramatic about all these retirees, the baby boomers. But we foresaw that baby boomer problem; we planned against that baby boomer problem. Our problem is we've been spending that particular reserve, that set-aside that you testify to that is so necessary. That's what I'm trying to get this government back to reality, if we can do that.
We owe Social Security 736 billion right this minute. If we saved 117 billion, we could pay that debt down, and have the wonderful effect on the capital markets and savings rate. Isn't that correct? Thank you very much, Sir. Thank you, Mr. Chairman.
______________________________________
END EXCERPT
Concludes whatreallyhappened.com: “It should be obvious from the above that the government has for decades been taking the money intended to pay Social Security benefits and spending it as general revenue. The Social Security trust fund is filled with Government IOUs…
“Regardless of the mechanism, the bottom line is that the government looted the retirement funds of Americans…”
http://whatreallyhappened.com/WRHARTICLES/ARTICLE2/budget.php
Absolutely correct. I'm Gen X and I get so sick of the "Hate the Boomers" meme. The meme should be "Hate the Bankers" at all points. Fuck ageism. This article is no different than a race bating article.
" From its inception, the bankers and their allies have been trying to destroy Social Security in the US. "
Really? Based on..........what? Roosevelt's advisors were not all a bunch of east coast liberal pinheads and monied interests? Just as the Fed was sold to the people 'to break up the monied interests', so was SS.
Thanks, I wish facts played some role in this discussion, but unfortunately everyone is looking for someone to blame and our government and socialist elite are intent on diverting the blame onto the very victims of their fraud. I guess it ultimately is our fault as we should have known better. It just rubs me raw when they are throwing it in our face.
Jamie gorelick. the name sounds vaguely familiar. is she the one who cured polio?
No, I believe that was Al Gore. Oh, wait...
Actually, among other things, Jamie served as Vice Chairman of Fannie Mae." But as things go, "results of an internal audit showing improper accounting within Fannie Mae is given as the reason for her resignation. Her involvement in many of the major tragedies and high-profile American scandals of the past two decades," continutes Wikipedia, "has led some in the press to dub her the 'Mistress of Disaster.'" A fitting qualilfication, surely, for the Urban Institute and its SS involvement.
JR, I agree with most of what you have to say, but not about the illegals not paying into the system. And I know this from personal experience from a friend who ran a high end renovation business and hired illegal installers almost exclusively. They all listed 9 dependents and never paid income tax, but all had to pay their SS on phoney cards from which they could never collect. Some say it is the illegal contributions to SS that is keeping it afloat at all.
And I wish that the people on ZH would learn the difference between socialism and fascism. They both suck but are structured a little bit differently. Socialism is where a small group of thugs proclaim themselves the government and take over all the productive assets of an economy and funnel the benefits to the top government thugs. Fascism is where the major monopolistic corporations and banksters take over the government to do their bidding. Obama just happens to be a puppet of a fascist system. They both suck and the common man is fucked by both systems, but I am a stickler for keeping the ducks in a row.
Good points, el Gallinazo. The exceptions are those illegals who’re paid in cash and for those who work for an employer who just cuts them a check – situations of which I’m most familiar – and then issues them a 10-99 at the end of the year.
But, as it’s then up to the taxpayer to file a return and pay the taxes and in that illegals don’t have SS numbers (except fake ones), they don’t file and thus evade the taxes.
But whatever the sum from those who do pay into SS, mostly on a low salary base, it in no way comes close to the welfare dispensed in their behalf nor the economic costs suffered on their behalf by the American taxpayer.
As for fascism, I’ve always believed as John T. Flynn, that “Fascism is Fabian socialism plus the inevitable dictator.”
However, I see your point and perhaps it can be said that crony capitalism is fascism and that when fascism reaches that stage whereby the state and the fascists own all the means of production, a socialist state results.
In any case, the way Hayek outlined it, we’re on the “Road to Serfdom,” i.e., socialism. And as Lenin stated, socialized medicine, i.e., Obamacare, is the keystone of the arch of the Socialist State.
American socialist, Norman Thomas, six times candidate for president on the Socialist Party ticket, in 1927 said the American people would never vote for socialism. But he said under the name of liberalism, the American people would adopt every fragment of the socialist program...
Definitions provide no service or answers to our problem. The problem is corruption and it is enabled by the centralization of power. Its not like we can fight "socialism" or "Fascism" to cure what ails us. Both of these ideologies could in theory work except they don't, because of the corruption of centralized power. You can't defeat it. Like any other cancer, once it reaches a critical stage the only way it can be defeated is the destruction of its host.
Great point on fascism vs socialism. Seems all the "tea-partiers" believe Obama is a socialist (per Fox news). Thanks for clearing this up.
JR, it is a shame your comment has been buried so deep, now on page 2. You make excellent points about SS, and also tie into the broader framework. I did not know that welfare benefits have not been cut in Cyprus, but it does make sense. The more a country knocks out the middle class, the more poor there are and the more difficult it becomes to lower the safety net. That is true even if the safety net is overly generous. The analogy for the US is clear and frightening.
http://www.usinflationcalculator.com/
Caculate the inflation --in 1959 when I started "contributing --$1.00 , it now takes $8.03 to return that dollar to me . The total cumulative rate of inflation is 702% -
Exactly. The real culprit is dollar devaluation!
And that is if you believe the Bureau of Lying Statistics numbers.
i almost never see old folks begging for money by the freeway
Had not the US gone to a unified budget under Johnson in the late 60s, whereby Social Security and Medicare Trust funds assets are now used to to fund government spending, the trust funds would be solvent and would not be the unfunded liability that now hangs over the heads of future generation.
Had we not believed our government employees and representatives virtuous, we might have avoided this whole mess.
Well, I have given that some thought over the years, but I can't figure out, where else would the SS put the money other than Treasuries? The Dow? Corporate bonds? That's what the Fed is doing right now and I can't say that I like it.
And putting the money in Treasuries is exactly what was done and it allowed it to be pissed alway on whores and woars. I never could come up with an answer. Seems like everything else in our economy ........ a Ponzi scheme. Only Charles Ponzi and Bernie Madoff are the only ones who did any hard time for what the entire financial "community" is scamming.
Arguments that this article makes become really hard to justify when the Financial elite have been bailed out and there is no more money for gramps.
Are you also proposing clawbacks for the last 7 years?
So you justify stealing from me because someone else stole from us?
Really?
I wish the Boomers died before they got old.
Worst.Generation.Ever.
It that you? Oprah.
If it isn’t, I need to relate Oprah’s wisdom for you expressed the other day in an interview with the BBC to promote her film "Lee Daniels' The Butler." It seems you’re on the same wave length. Said Oprah:
“There are still generations of people, older people, who were born and bred and marinated in it, in that prejudice and racism, and they just have to die.”
http://articles.chicagotribune.com/2013-11-20/opinion/chi-oprah-racism-kass-20131119_1_oprah-winfrey-president-barack-obama-death-panels
Oprah is right. all those old racist white people need to hurry up and die. so that a new america can rise up, one that more closely resembles urban chicago, or detroit. or somalia. it's free, swipe yo EBT. fuck you oprah, you ungrateful racist pig.
Fat lesbians are never right.
if we had the trillions in money given the TBTF the SSN system would be solvent and then some. the mfs who destroyed this country in 2008 should be in jail. where were you in 2008 ill tell you what your generation was doing, they were voting for obama. not saying youre the worst gen ever, i wasnt around for the troglodytes
If you leave out the disaster of medicine and Medicare in the USSA, the Social Security system is solvent, at least in terms of the accounting. The fact is that the gummint took our money from their mythical "lockbox" and spent it on wars and whores.
In Mexico, few people have medical insurance. Competition between physicians and laboratories is fierce. I had a problem with my blood pressure recently and went to a great homeopathic physician. I must have spent 3 hours with her total, and she has so far charged me $45 including non-toxic homeopathic medicine. She didn't like the way my heart sounded, so she asked if I would go see a cardiologist two blocks down the street. She called him up and told him I was on the way down. Had to wait 2 minutes to see him. Gave a personal history in my halting Spanish, had an electrocardiogram, after which he explained the results - $70. He sent me to a lab to get full blood and urine spectrum tests with about 70 test results. Waited 5 minutes to see the tech and got the results 4 hours later. Total charge 105 dollars. Well it all worked out really well and I don't really have any problems. If Fukushima or a predator drone hit doesn't kill me, I'll probably be on this prison planet for a while. I am on no drugs beyond a gram of vitamin C a day. SS takes out $100 a month from my check for medical, and I can't opt out, but I have no intentions of going back to the USSA for any medical treatment. I couldn't handle the abuse.
Your experience, el Gallinazo, bears out what former congressman Ron Paul said a few years back regarding what healthcare was like in Norman Rockwell’s America:
“I started medicine when there was no Medicare and no Medicaid and let me tell you, I don’t remember one time when I saw people out in the streets begging for medical care. Now we do. With managed care and now with socialized medicine coming, believe me, quality will go down, costs will go up, there will be shortages, there will be lines and nobody is going to be happy."
In a nutshell, here’s what troubles Dr. Paul about socialized medicine and America's “messed up” concept of insurance:
“We’ve had corporate medicine now for about 35 years which is managed medicine by the government, and it has been a total disaster and it didn’t do much more than push the costs up. And it didn’t work, so now we only have one other choice, it seems, and that is going towards total government medicine. I would like to see that medicine be delivered in the marketplace like other goods and services. There’s no reason we can’t do this.
“Everybody complains about one thing: the cost of medicine is too high, and it is. But they never talk about exactly why. There is an inflation factor involved, too. I mean, we create inflation, but it goes into certain areas of the economy more so than others. The more the government is involved in an industry or service, the higher the prices go. So, in education costs go up way beyond the cost of living, and the cost of medicine goes way up. So you can’t solve the problem of medical care by ignoring this. Now, Obama says, “What we’re going to do is is we’re going to tremendously increase the services and we’re going to cut all the payments to the doctors in the hospitals.
"I mean, where is he coming from? That can’t possibly work…”
I think this is the most juvenile article I've ever read here.
(That wasn't a knee-jerk reaction; I read it four times to be sure.)
This works one of two ways for me. Either give me my benefits when due, or refund every penny I paid in, adding interest and inflation for all the money I paid. I and nobody else has ever had any say in what the crooks in Washington do with the money that comes in. Give me back what I paid in and .GOV can go fuck themselves.
think about all the people who paid into SSN who never drew a benefit. then think about what the average retiree receives in benefits (not every one qualifies for benefits remember, you have to work at a job with a payroll deduction, and the more you pay in the more you receive) nobody is gettin rich off his SSN. i used to hear this crap from the Reagan people talking about welfare queens in cadillacs, while the real welfare belongs to corporations the trillions that went to the TBTF. did those bankers earn the right to that money? no they fucking stole it. end of story
And yet, just watch, the suckers will go out and vote again. Why? It only gets worse!
Where in the hell have the congress, presidents,and main stream media been all these years?
What we needed was a congress full of Ron Pauls. The very thing the media and the two political parties actually fought to prevent! What that tells me is that they are the enemy. We get ripped off, no way to prevent it. The older will lose out in retirement, the young will have a poorer future. But of course we will all save what real wealth we can get by with......still, it's a rip...those sob's...
rEVOLution
Interesting. I've said (and really came to this conclusion in an abrupt and painful manner) that democrats and republicans are flip sides of the same coin. This is why the Tea Party, which is not, causes the former to deny, denigrate and demonize them and the latter to ostracize them whenever politically expedient.
Stop telling us not to vote! What would that solve? It doesn't matter anyway. The people chosen to run for office are all, or soon will be, on the take. Those who want social bennies vote one side, those who support corporatism the other; in the end they are all the same, just in it for themselves. Most of my friends are staunch Rs. I tried my best to get them to see that Ron Paul was our best choice in the primaries. They said he couldn't win and it was more important to defeat the Ds. They defended Romney by saying he didn't break any laws. They couldn't see that the way he got his money was basically immoral. They got all wrapped up in the immorality of abortion and gay rights, played right into the hands of the MSM. There is no solution here. People are angry but TPTB have us by the throat.
BTW What is relevant about this whole article, ss, disability, food stamps, etc., etc. is population explosion and technology. We don't have and will not have enough jobs for the present population much less the growing population because of automation. So the era of the middle class is over. The battle will be between the haves and the have nots.
new rule: Everybody over 65 is subject to the draft, and we declare unending war with Japan, whose decrepits are also subject to the draft.
The war will remain isolated to the former leper colony on Molokai, Fox gets broadcast rights but only because Rupert Murdoch is in the first landing wave.
universal death panel, bitchez.
for a long time i felt sorry for you young kids who couldnt find a job, thank you l'm over that now
that's just dementia setting in, dn't worry you will stop noticing fairly soon.
Please excuse the young as they know nothing of what they say. Ignorance is their bliss.
This post brought to you by the Koch brothers who believe they should pay no taxes, and government should have no deficits. Thank you.
Someday when you grow up you'll get over believing in santa claus, the easter bunny, and boogie men.
I am 67 years old, on SS, and living in southern Mexico where I can still get by on it. My savings don't pay enough interest to keep me in beer for one month of the year thanks to the chairsatan's ZIRP. As to "killing the meme that people on SS didn't pay their share," this article is 99.44% pure bullshit. So I offer the following deal to the Federal Government of the USSA. Take each year I paid into SS and then calculate a running sum of the payments of myself and my employer (who was myself for a good deal of my working life). Add the average prime interest rate for that year onto the running sum, and also add the real inflation rate for that year to the sum, but not the bullshit BLS rate. Total that sucker up, send me the check tax free, and you need never hear form me again. (At least in terms of SS but not all your other bullshit policies and wars). Problem solved.
Hey Gallinazo,
You miss the big point. YOU ALREADY GOT YOUR "BENEFITS". They were in the form of reduced taxes since 1965. You see when Johnson unified the budget he did so, so that he didn't have to increase the tax base to pay for guns and butter. Your generation sat back and allowed this lie to happen so your tax rates would not be raised.
You paid money into one pot (the social security pot) and got it back in another pot (reduced income tax rates). The taxpayer owes you bupkis. You took your eye off the ball, and bought into all the lies because you didn't understand simple arithmetic, you lose!!!
Icarus
Age 60
Icarus, you're full of beans and BLUE MUD!
The folks who have been paying taxes on earned income for the past 50 years have been steadily raped by the Federal gov't. Just look at the purchasing power numbers for blue collar workers during the past 50 years ~ just about a zero increase--- for 50 years! That's because the tax code took more from wage earners than CPI or COLA adjustments or exemptions or deductions ever made square.
So the tax code has been net negative for wage earners for 50 years while capital gains, interest and dividends, not subject to FICA, have gone "unchecked". You are BS and everybody filling out a 1040 every April for the past 50 years knows it to the core of their being.
Your ignorance of basic IRS tax-adjusted reality is inexcusable, unless you are from some country outside the USA.
Mr Steve,
Blue Mud? You must be a progressive. Your criticism of my reply is nothing but deflection of the argument to something else. Straight out of Saul Alinsky's book. I posited an argument not about the fairness of the tax code but about the fairness of the social security system. You now complicate a simple statement on my part by bringing in Cola's, captial gains, CPI's and investment income. Again you miss the point.
WE all know the tax code is a sham and a redistribution of wealth from those who don't have political influence to those who do. What occured over the last 50 years with income tax expansion and cola's, is not related to the social security issue I brought up. Two seperate issues.
My point put simply: Whatever the result of the tax code over the last 50 years, your income taxes would have been higher had it not been for the unified budget and pulling social security funds into the general budget. Your social security payments were a lie and a stealth income tax, not a retirement plan. These funds were not set aside for you, they were used to keep income tax rates lower for you, to buy your vote. Hence the statement that 'you already have received your benefits' through reduced income taxes for 50 years. That money is GONE. And you knew it was gone throughout the entire 50 year period. You didn't see the lie, because you didn't want to see the lie.
"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!" Upton Sinclair
Icarus
You may be missing the point....There is NOTHING that the government promises or provides that is not based on something for nothing. How do you think they came to power in the first place? We can set here and argue about what is affordable or not, or what is fair, but none of that matters because the only way they can stay in power is to lie. To lie about our risks as well as the solutions to problems,be they real or not. I would submit that the vast bulk of issues we labor under today are a direct result of government actions and interventions. All of which are based on lies or gross exaggerations.
"My point put simply: your income taxes would have been higher had it not been for the unified budget and pulling social security funds into the general budget."
I see. Your position is that the politician and banker thieves were really doing us a favor of sorts.
In my experience, people capable of such sophistry should consider economics as a profession.
Icarus, I'll buy about 20% of your argument. Johnson "unified" the tax system to pay for his guns and butter and the Vietnam debacle which in a few years forced the succeeding bankster puppet, Milhouse, to take the dollar of the international gold standard. Since there is no such thing as a "lock box," this enabled him to increase taxes on a regressive basis while keeping his behind the curtain illusion as a "populist." He didn't lower my taxes at all but just shifted them to a more regressive formula. Since I have rarely been a big time earner, he actualluy raised my taxes. And this gift from LBJ has already meant that I have received my SS payments back in full through lower taxes? A total crock.
el Galli...your restraint, in telling Icarus his presentation is a total crock, shares in my reluctance to call Icarus a full of shit bullshitter here on ZH. At this point, refined discourse is lost on him. My Tea Party and Promise Keeper friends gag on him calling me a Saul Alinsky, issue deflecting progessive. His labeling and name-calling are sophisticated propaganda tricks and projections of his own mental failings. Icarus, get help soon!
The fact that FICA is a tax and working people have not been able to get ahead of its regressive, inflationary nature is a real problem for uncritical thinkers like Icarus who post on ZH as if they have any insight or even a handle on real-world data points.
If Icarus had any sense, he'd know that the working class has no savings now because the value of their wages has been eroded through taxes and inflation. What savings they had and might have been earning interest has been confiscated by the FED's ZIRP. Perhaps Ickarus is a banker-troll?
The Ponzi nature of all modern finance necessarily includes schemes like SS, so singling it out as somehow being "unfair" is a truly a lame and empty position.
If they had raised income taxes, or not lowered them to pay for the Vietnam war, people would have noticed. The war would have stopped much sooner.
Close.
You cannot assume you would've invested the money had it not gone to the gubment. A better example would be, total your contributions and your employer contributions THEN subtract all you have already received.
And let me add, what were your SS contributions in 1963 and what are you receiving in 2013?
You are correct that the payments I have already received should be subtracted from the sum. As to whether I would have invested the money in financials or more profitably on booze and women, that is my business and not that of the government.
The other fault with my proposal that would work against me bigtime, is that there is a huge build up of inflation from the QE's which has been partially dammed and not reached retail prices. When that hits, and it will any time now, I would be screwed as my "payoff" would not reflect this.
The wrath of the buzzard.
To all you people bashing the so called boomers for who they voted for,who and what the fuck are you voting for?
Libertarian all the way.
Who the fuck are you voting for?
Nationalists. The Libertards want open borders. F@ck that.
Not all libertarians want open borders. Additionally, removing the incentive of "Free shit" would reduce the illegal traffic and force a more proper flow through legal channels.
The cities have a built in dependency culture, into the very architecture, as much of the accomodation does not support growing vegetables, gathering drinking water or generating power. If you kick the 'free shit# away you end up with a Ukranian style Holodomor. Nobody is going to vote for that except the rich.
Who's fucking fault is that? The douche bags who started the free shit train. If you want to blame someone, blame those assholes that created that culture. Otherwise, you're going to see your Holodomor on a 10x larger scale at some point.
I'm in my 30's...i'm working until i'm dead. I have no hope there will be anything when/if i get there. Can you imagine what the posts on ZH will look like in 2049?
ZH won't be around by then.
"an average-wage-earning male would get $180,000 in benefits, but pay only $61,000 in taxes"
so sorry to rain on your propaganda but i'm decades away from retirement and i've paid in over $150K to SS so far so lets use real numbers instead of your "i wanna make a point by lying" numbers.
TIA
The statement you quote was made in relation to Medicare contributions, not SS which are additional and discussed in a following para.
I'll be happy to take only the amount I paid thru taxes into social security -- I'll take it in gold at the price of $35 an ounce. That would come to about 2,000 ounces that I paid in. I'll never get that value out of soc sec. And who do these morons who defend the current socialist payouts to deadbeats think is going to pay those bills in 30 years? Soc Sec recipients paid what they were made to pay. The mystery is why I spend my time answering the morons who don't get it. Bravo to those who do.
I don't read anything that has the words 'meme' or 'ponzi' in the tiltle. Why would anyone?
read the rest of the title.
Really interesting that this article doesn't mention Obamacare and the impact those old enough to draw SS will have. My guess is this is one of many articles to come designed to pit the youth against the old with the end game being general acceptance of what Sarah Palin was ridiculed for calling "death panels" which turn out to be exactly that and with out death panels the ponzi goes tits up quick....
1. Social Secirity is a business run by government
2. Government invested contributions into buying IOU's with a terrible rate of interest.
3. Said government wasted the money on largely non-productive ventures.
4. Policy holders started living a lot longer than initially calculated.
5. Medicare costs associated with the retired have also blown out.
6. Demographics are also slowly exposing the weakness of the system.
Conclusion: Scheme was badly designed, badly managed, robbed and never properly reviewed.
Result: We are all screwed one way or another whether we are 20, 40 or 70.
It may have just worked if it had not been sabotaged by the immigration and race pimps, as a way of transfering wealth from those of European origin to those who are not of such origin.
The 70 yo might have a chance. And if you are younger and are determined to cling to the beast, you might do OK.
Actually we did pay our taxes and we did earn our benefits. Those who pretend otherwise are lying toads.
Well, you were promised a Denarius, but at the end of the day the Master may not have enough to pay all of the slaves. He has the whip, eats well and gets plenty of rest. You are tired and emaciated. Sorry about your misfortune. We will always have our poor.
What pretty much happened.
Old people borrowed against the proposed prospertiy of their offspring.
Then spent all the money to pillage and plunder the economy.
Left a wake of economic distruction and mal-investment in their wake.
And now they expect the poor generation saddled with unpayable student loans "because you can't get a job unless you go to college " (more like, I fucked up the economy and need my job for another 20 years, sooo you have to go to school to take MY position even though Im doing this shit without a highschool degree).
School only acts to slow down sudents from getting the jobs, because there aren't enough open positions, so the government and businesses enforce school degrees to give the older generation time to retire/die before the new people can step into those positions.......since no new jobs were created and the old job positions are shrinking since technology/offshore labor replaced them.
The entire situtation is quite fuxed.
With any luck some 20 ~30 year old nerd in their basement will figure out fusion reactor tech / thorium reactor tech to give us the unlimited energy we actually need to fuel job creation.
The main reason the economy is falling apart is 100$+ oil.
This debt based money system only works to grow the economy if there is a source of energy cheap enough available to offset the cost of living.
1 Barrel of oil is something like having 200 slaves your not paying working for you for a year non-stop.
We need to replace 100$ oil with free energy from fusion reactors to make the economy start creating wealth to back the debt again.
Until that happens debt will grow, assets will shring and a debt based deflationary collapse will emerge.
Dre4dwolf you have bought into the generation wars now being wage by our politicians. This is not being waged by you or I. The truth of the matter is our politicians took a solvent system and squandered the excess money on other programs and nothing more. Follow the money and you will find the answer. Now the same politicians are telling the people SS is broke because of us or actually we are living too long. Think about that argument for a moment. We the people did not do this and yet we buy into this argument because we are bombarded daily with articles like this. The whole picture is not portrayed in this article. The theft of the fund that by law were never to be used for anything else is never mentioned. SS is not suppose to be considered in the budget debate because it was not designed for the funds to be used for anything else and yet we want to lay blame on an older person. Why? Because now the funds head straight to the general fund while they issue IOU's to the SS fund. This will never be paid just like our government debt will never be paid.
Honestly I am sick of all the bickering. You go to a financial site and they tell me I need to quit working because a young person needs my job or you go to another site with prettty charts telling me age group 50+ is doing well in the job market. I come here and see articles like this trying to lay blame on me for doing what was and still is required by law to contribute too, so when I get old I might get some money back. Follow the money my friend and you will find our government basically stole all excess funds to pay for other programs.
Do not blame the old folks I certainly do not and most of you here are some smart people but miss the fact that we have been robbed and you or I can do nothing to stop it. Both parties and bloggers and the media are spreading hate and discontent to blur the real picture and the real picture is our government does not want to take blame for their theft! Once you understand this you will get a clearer picture. SS had never been insolvent until the politicians used the excess funds for other budget items.
Thorium reactor: talk to the biggest producer of them, China.
In my opinion, the main reason the economy is falling apart is too much gov't and too little value in our currency.
The analysis does not include the time value of money.
Spot on observation ! I'll be happy to take only the amount I paid thru taxes into social security -- I'll take it in gold at the price of $35 an ounce. That would come to about 2,000 ounces that I paid in. I'll never get that value out of soc sec. And who do these morons who defend the current socialist payouts to deadbeats think is going to pay those bills in 30 years? Soc Sec recipients paid what they were made to pay. The mystery is why I spend my time answering the morons who don't get it. Bravo to those who do.
I've paid in for 40 years and would be thrilled to receive what it would be worth were it put in Dow 30 all those years.
Agreed. Also puts the correlation of the half a quadrillion future liabilities in context with value of money. Holding true, that would put a case of beer in 2050 to about $35,000 ?
Lets put those half a quadrillion dollars in context, shall we? When those big numbers that most people can't pronounce are being thrown about, what is being implied is that every single financial obligation for the next arbitrary number of years is due, right this very minute.
Lets put it another Dan, because context does matter. It would be as if we were to take every single financial cost that you will incur from this very minute to the day they put your worthless ass into the ground, and demand that you pay for those costs right now. Those costs would be your unfunded liabilities.
Each worker contributes to Social Security. Social Security has nothing to do with Medicare. False meme. Unless you're the Peter G Peterson Foundation.
Both Social Security and Medicare share the similarity that those who benefit from these programs take out way more than they ever paid in.
The meme is not false:
the beneficiaries of both programs are takers.
It's not just old fogies either:
When my brother-in-law died,
one of my nephews used the social security benefits to put himself through school,
the other nephew used money from the social security fund to buy drugs,
... and not the medicare kind.
Stop with the "takers" bullshit. If you are on American soil, you are being subsidized by federal, state and local governments. The taxes you pay are worth much less than the benefits you receive. You are on thin intellectual ice here.
This whole bullshit argument about takers vs. producers is just as worthless as the chicken or the egg debate. It's circular, and only leads to the oligarchs kicking our collective asses.
How ironic is that?
Somebody with the nick "Accounting101" tells me
I get more in benefits than what I pay in. lol.
Please go on, please list these benefits I am receiving! Oh yeah that's right, I drive on the Interstate Highways once in a while. Those highways are dang expensive, and all my measly taxes go to pay for the asphalt under my joy ride.
You should get out more....
Value-added big Gov't? Barry, is that you?
Are you talking about my pothole riddled roads? The worthless cops that sit around in squad cars all day trying to catch people doing 38 in a 35?
Maybe the three 24/7 356 fully staffed fire stations costing the city millions just in case multiple four alarm fires happen simultaneously all over town.
The fact that 34% of my tax dollars go to fund the public pension system so public "servants" can retire with $80k a year coming to them for the last 30 years of their life.
The government spends trillions on defense, yet can't keep an airport terminal safe. The absolute bureaucratic waste consuming 50% or more of whatever money does come in.
I'm really trying to find where I get more from the government than I pay in. I'm not seeing it.
No dumbass, public servants are not getting more in their pension per year than the amount they earned per year working. That's just the bullshit you ate, courtesy of the oligarchs. For Christ's sake! This kind of stupid ass nonsense is why the middle class is being shredded apart. Blaming firemen, police officers, teachers and librarians for the economic calamity which we find ourselves. You are a fucking idiot!
After reading this shit comment and others regarding this post, I will take sadistic glee in the fact that all of this will end so badly. We don't deserve for this economic nightmare to end. Collectively, we are to fucking stupid.
The oligarchs are laughing their asses off from on high.
Don't forget that all working Americans also contribute to Medicare as well. You are spot on with the Peterson Foundation comment. The whole point of this anti-SS post is to separate the middle class from their money. When SS is either severely cut or destroyed entirely, there is more money for the oligarchs.
I'm sure you will see a great number of down arrows. The useful idiots are out in full force, and they have no idea that they are carrying water for the oligarchs.
The hypocrisy displayed here is astounding. People want to end the Fed and go back to sound money, but they want their "earned benefits" too.
You can't have it both ways. If we end the Fed and go back to sound money, there won't be any money to pay your "earned benefits". That money doesn't exist, and wouldn't be created in a sound money system.
Only way to get your "earned benefits" is keep the system we have now so the Fed can keep printing and the government can keep borrowing.
Say what? You'll take a lump sum payout now? All the money you paid in?
Nope, that money doesn't exist either. It would have to be printed.
The "earned benefits" of SS is just an illusion. Even though SS is described as insurance and the money you pay in is called "insurance contribution" (FICA), it's not insurance in a legal sense. SCOTUS has rulled FICA is a tax, not an insurance premium. It's a tax earmarked to fund a welfare program called Social Security.
SS benefits operate just like any other welfare program. Congress can change the benefits anytime they want, just like they can change the benefits of any other welfare program.
When you applied for SS, you didn't apply for an insurance policy. You applied for a welfare program, just like somebody applying for food stamps, no difference.
The SS benefits shown on the statement you get each year are based on current legislation, and that legislation can change. There is no contractual obligation like you would have with an insurance policy.
You disagree? Ok, show me your SS insurance policy. The one you received showing your premiums and benefits.
What? You never got one?
That's right, you didn't get one, because SS isn't insurance. No policy, no insurance, no contract.
SS might be an entitlement just like food stamps is an entitlement. Long as you meet the qualifications you're entitled to benefits.
But the qualifications and benefits can change at congress's whim. They could shut down SS benefits tomorrow. Just pass a law saying no more SS benefits. And they could still collect FICA. Because the tax is separate from the benefits. They're not connected contractually, because there is no contract.
So I guess the "I" in FICA stands for welfare. SCOTUS ruled its a tax just like ZeroCare is a tax? Means testing is class warefare just as ZeroCare is... I think the next 2 elections are the most important in out counrty's history - the thing is that the people getting out more than they have taken in is a solid voting block.
The "I" in FICA is a lie ...just like "Federal" in Federal Resrve is a lie ...and "Affordable" in Affordable Care Act is a lie.
They can call something anything they want to call it. The name has no legal force. The legislation under that name has the legal force, it can say something totally different, and usually does.
And SCOTUS ruled correctly on that one. FICA legislation defines a tax, not an insurance premium. In subsequent lawsiuts government lawyers tried to twist it around to make it sound like an insurance premium, hoping the justices wouldn't read the actual legislation, but they did, and ruled correctly that it was a tax that had no contractural relationship with benefits.
That was back when SCOTUS made correct rulings based on the actual legislation, not their personal views like they do today. Ok, not as much as they do today.
My mom worked a couple years before college, and a few years after. She hasn't held a job since she was 23. My dad has worked every day since he was 15.
They will both receive the exact same payment from Social Security.
That's a whole lot of the problem right there.