Monday, March 07, 2005

Social Security: Change is a No-Brainer

NO ONE has advocated the repeal of the Social Security program!

NO ONE is advocating any reductions in benefits for anyone!

Retirees and soon-to-be retirees 55 and up will not be affected by any changes Bush is proposing.

So why such vocal opposition from the likes of AARP and other old people organizations?

Why would my 82 year old father oppose letting young workers like his grandchildren and great grandchildren bank some -- I said some -- of their retirement money in investment accounts they own and control, rather than letting the government own and control it all, as if somehow that was going to adversely affect him?

Why are virtually all 'big' Democrats opposed to Bush's plan?

Why is Big Media virtually always on the side of 'big' Democrats?

There can only be one answer: Follow the money.

Politicians in general and Democrats in particular adamantly oppose ANYTHING that reduces the white-knuckled grip of a politicians hands on YOUR money. THEY want to control it. THEY want to spend it (on their own pork-barrel projects). THEY will only dole it out to you as they see fit.

The fact is, Congress has been raiding the funds generated from the Social Security (FICA tax) program for many, many years. For any politician, ESPECIALLY a Democrat to look all wide-eyed and wholesome (wink wink) at that fact is a crock. (You'll recall that Democrats controlled most of the House and Senate for nearly 40 years until 1994.)

The AARP needs you to be poor so you'll sign up for your big 10% off savings on stuff. If you had a million bucks in the bank you wouldn't need them.

Fact: If every penny that was collected into the Old-Age and Survivors Insurance Trust Fund via the FICA tax had been invested and kept separate from the general fund there would be billions of dollars in surplus to fund all retirees.

But you see, that's not what happens.

So where does the money go? According to the Social Security web site the money they collect in FICA taxes is immediately turned over to the General Fund in exchange for "special issue securities". These securities are similar to what you and I would get if we bought U.S. Treasury notes or Savings Bonds; a piece of paper with a dollar amount that is backed by the Federal government. Essentially a federally guaranteed I.O.U. So the government is essentially selling itself savings bonds and paying itself a nominal interest rate on those bonds. egad!

In the meantime, Congress spends the money from the Social Security Trust Fund (SSTF) the minute it is moved into the General Fund, leaving only that I.O.U., excuse me, that "special issue security" in the SSTF. Once in the General Fund, of course they find plenty of places to spend it (can you say Big Dig? This boondoggle is located, by the way, in one of the smallest states, yet is represented by two of the richest and most liberal senators in the country. Take a guess.)

This is a perfect, classic, textbook example of why we should NOT be letting Congress and the Federal U.S. government handle our retirement!


Why in the world would we want to keep this system in place when it is so inept???

You put your money in throughout your working life and years later you're told: No, you can't retire yet, we just raised the retirement age. No, you can't get what you thought you'd get, we just lowered the benefit. No, you don't get to keep all of your benefit, we just raised your taxes. No, your medical benefit isn't free. We just raised your premium, lowered your benefit, upped the deductible, require a need, etc., etc. etc...


STARTING AT AGE 20 IF YOU HAD BEEN ABLE TO PUT 4% of your gross income into an investment account that followed the S&P500 Index (relatively low risk), you would be retiring today as a MILLIONAIRE. A millionaire!!! In addition, that 4% represents only ONE-THIRD of your total FICA contribution (you put in 6.2% and your employer puts in 6.2% on your behalf.) That means that your Social Security benefit would only be reduced by one third.

Whoa! Wait! Stop! You're going to reduce my Social Security benefit you say? No way!, you say. That sounds like a risky scheme, they say.

Alas the UN-benefit of being educated in a federally funded public school. You can't seem to do the math.

I said you would be a millionaire. You would pay yourself in your retirement!

Look, the AVERAGE Social Security retiree benefit check today is a paltry $800 a month. The max is about $1,500 or so.

If you had a million dollars in a fund, starting at age 65 you could draw out $2,700.00 a month for the next THIRTY YEARS (God willing you should live so long) and there would STILL be money left in the fund! What's more, whatever is left in the account when you die goes to your heirs, NOT to the government!

ARE YOU TELLING ME YOU WOULDN'T TRADE OFF 1/3 OF $800 of the government dole (a.k.a. Social Security) to gain $2,700 a month income of your own money???

People, this idea is a no-brainer!

Right now you don't have a say in paying that 6.2% FICA tax. All President Bush is proposing is to let YOU decide how to invest a small portion of that FICA tax.

What is it opponents are afraid of?

President Bush has freed the Iraqis. He's freed the Afghanis. In his first term he also freed many Americans in the way of lower taxes. He has proven he's not afraid to take a stand, do what's right even if it means touching the 'third rail'_*. (Frankly, I think they ought to tape a few senators and congressmen's legs to the third rail. Maybe it would help jump start them and get them off their butts and move forward on this plan.)

This term Bush is striving to free even more Americans from the advent of poverty in their old age. The federal government does not want to be the caretaker of the elderly. Even Roosevelt's original Social Security plan was to make the system of Old Age Insurance self-sustaining in order to get old people off the public dole in their later years. But as with most government programs, the original intent was side-stepped by the smell of all that money. The bloated and inept bureaucracy of government is NEVER the best way to go when large amounts of money are at stake.

People sneer at the Enron debacle and tout the dangers of putting all your retirement eggs in one basket, yet they are willing to blithely put their trust and their money into a government system for 40 years with no say on how that money is used or invested,no say on how to spend it, and no say on who gets what is left of it when they die.

That's just crazy.

President Bush's plan for changing Social Security is not only an idea whose time has come, but it is an idea that is long overdue. Freedom is financial independence.

Write your Congressmen and Senators! Write your newspaper! Spread the word!


(_* The third rail is city-folk speak for the subway rail that runs along the center between the wheel rails and powers the train. It is 'hot' with high-voltage electricity. You touch it, you die. Use of the term third rail in the political context is to denote a political idea or topic that is so unpopular that a politician or public official who suggests it becomes the subject of public derision; for example, a politician who would advocate the repeal of the US Social Security program. The analogy is that touching the third rail results in instant death. (ref Wikipedia))



Social Security Trust Fund Sits in Drawer


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