Social Security

            Social Security was a program instituted by FDR during the Great Depression that promises American workers a government-secured pension when they reach retirement age.  Unfortunately, though, the Social Security system seems to be failing.  Despite its history of more than 60 years, Social Security is quickly running out of money.  Thus, a debate ensues over what is to be done about this problem that will be facing Americans in the near future.

            Many people have misconceptions about the way America’s Social Security system works.  They believe that the government takes the 12.4% out of every payroll check they make and puts it in an account with their name on it for them to draw out in monthly increments as they grow old.  Unfortunately, though, the government doesn’t have that luxury.  As soon as the government receives money from the taxes, they send it out immediately to those drawing Social Security now.  At its inception, there were about 46 workers paying Social Security taxes for every person of retirement age drawing it.  Now, however, it has dropped to about 3 persons per retired person.  As the baby boom generation reaches retirement age, it will drop to 2 per pension check.  This means that every person will have half a retirement check drawn out of their payroll if Congress doesn’t cut benefits, change the Social Security system, or find some other way of funding it.

            Those who are in favor of Social Security look at its long history of helping Americans.  They believe that if we continue to pay into Social Security it will stabilize itself as the retirement of baby boomers tapers out.  They are opposed to the privatization of Social Security because they know how a business seems to take invested money and funnel it into the pockets of those who run it.  Some even suggest raising the retirement age as life expectancy is increasing and more people of retirement age are living longer.  The biggest proponents that favor keeping Social Security are those who look at the promises made to America’s retired peoples.  We have to keep paying into Social Security in order to keep our nation’s elderly off the streets.

            Some people, though, think that Social Security should be privatized.  They know that business isn’t more likely to steal the money entrusted to it as a politician is, and they see the potential returns to a privatized retirement far outstrips the benefits one would receive after paying into Social Security all of one’s life.  They look at nations such as Chile that have dropped systems similar to our own and made a smooth transfer to privately managed accounts.  The Libertarian Party even suggests selling national assets (which it claims a government doesn’t need to fulfill its roles) to pay those who are receiving checks now.  They recognize that the nation’s retired persons are important, but so too are the young people who are paying into a system with a negative return.

            Social Security reform remains a major bone of contention in national politics.  As seen in the 2000 elections, no candidate has yet put forth a proposal that satisfies all Americans.  Of course, we could just refund all monies paid into Social Security to those who have been paying into it all of their lives.  After all, the national debt is obviously just a bunch of numbers that doesn’t really mean anything.