The Coming Financial Collapse of Social Security
, by Peter J. Ferrara, The Freeman
, Nov 1993
Social Security ... fundamentally operates on a pay-as-you-go basis. The tax payments of current taxpayers are not saved and invested to finance their own future benefits. Rather, most current tax payments are immediately paid out to finance the benefits for current retirees.
Default Circus — er, Crisis — Averted?
, by Sheldon Richman
, The Goal Is Freedom
, 18 Oct 2013
Examines the U.S. government's possibility of default on its debt and other obligations, with some side remarks on handling of Social Security funds
[One] of the biggest holders of Treasury debt is the Social Security Administration (SSA), a government agency. For years the Treasury borrowed the huge Social Security surplus, leaving the SSA with a trust fund full of "special issue" nonnegotiable interest-bearing bonds. Here's the thing: Whenever the Treasury pays off one of those bonds (now that the SSA surplus is gone), the debt level falls that much below the prevailing debt limit. So had the debt limit not been raised, the Treasury could have kept on borrowing simply by giving some current tax revenue to the SSA, which it would use to pay Social Security recipients.
Don't Privatize Plunder
, by Anthony Gregory
, 22 Sep 2004
Criticizes George W. Bush's plans to "privatize" Social Security, discussing the regressive aspects of it, how many older, even "free market" thinkers want to keep it afloat, and instead recommends scrapping it entirely by gradually reducing payroll taxes
Social Security is among the most tyrannical government programs under which the average wage earner must suffer. And I don't know who is more pitiable, the average employee who pays about fourteen percent — half of which is hidden because his employer must fork it over ... — or the self-employed worker, who has to cut the check for that much himself. ... Social Security is "regressive," in that the poor pay proportionately more, or, at least, more than the super rich, whose payroll taxes are capped at a certain amount. I don't like "progressive" taxes, but I might even hate "regressive" ones more.
Ending Social Security: Part 1
, by Michael S. Rozeff, 10 Aug 2006
Uncle Sam is a terrible and fraudulent investment advisor who has done the American public a huge disservice by forcing them into this poor investment, making them believe that money was invested in assets, and counseling and assuring them that Social Security would always be there for them. Uncle Sam can't keep this promise except by continual theft from new workers.
Ending Social Security: Part 2
, by Michael S. Rozeff, 11 Aug 2006
Two types of termination are discussed below. One is an end to the program in which it stops taxing payers and also stops paying benefits. As impolitic and extreme as this may seem, thinking about it is useful because it shows us that even this course is feasible and we see what is involved in a less radical phasing out.
George W. Bush's Nixonomics
, by Gregory Bresiger, Mises Daily
, 22 May 2006
Describes the various fiscal, monetary and economic policies during the Nixon presidency and compares them to those under George W. Bush
These wage and price controls went along with another series of measures that included the expansion of Social Security — in time for the increased payment notices to go out to recipients just before the election — without any projection of what it would cost ... Nixon's celebrated Social Security expansion included a cola provision without serious consideration of the long-term effects ... These generations of taxpayers will likely curse the government's faulty accounting techniques just as tens of millions of Americans of modest means pay higher payroll taxes than income taxes.
How We Privatized Social Security in Chile
, by José Piñera, The Freeman
, Jul 1997
Explains how the Chilean private pension system works and how the previous government-controlled system was transformed into the current one (the author was the Secretary of Labor and Social Security under Pinochet and designed the new system)
First, we continued paying the elderly who had become dependent on the government-run system. ... Second, we offered every worker the freedom to stay in the government-run system at his own risk. ... Third, we required new entrants to the labor force to join the pension savings account system, because we believed it was irresponsible to go on burdening our children and grandchildren with an unfunded debt.
The Immorality of Social Security
, by John Attarian, The Freeman
, Jan 1995
Understanding Social Security doesn't tell them about Flemming v. Nestor, the 1960 Supreme Court decision by which the wife of a deported Communist lost her benefits, even though her husband had paid Social Security taxes. ... it will be vital that the public realize just how morally flawed Social Security really is.
Interview with Gary Becker
, by Gary Becker
, The Region
, Jun 2002
Topics include the economics of crime, economics and law, banking discrimination, economic education, social security, behavioral economics, sociology, career choices and moral hazards
The present Social Security system is a mixture of an annuity and redistribution system. The redistribution system discourages many people from working at older ages when they are healthy enough and would want to continue working. Social Security gives them an incentive not to work because they are taxed so heavily on their earnings. It is really incredible, given that work is now much less physically demanding, and people are much more mentally and physically stronger than they used to be. ... It is a tax because workers do not get back dollar for dollar what they put in. They get back around 30 cents on each dollar they put in.
The Invisible Hand Is a Gentle Hand
, by Sharon Harris
, 14 Sep 1998
Defends the free market and individual liberty, quoting among others Frédéric Bastiat, Thomas Jefferson, David and Milton Friedman, John Lott, Isabel Paterson, Pierre-Joseph Proudhon, Adam Smith, Thomas Sowell, John Stossel and Walter Williams
Let's look at Social Security. You get a little of your money back. When you die, it disappears. In a free market, you would have the opportunity to retire better off than you are while you're working. Even if you're a minimum wage-earner. Economist and author Robert Genetski did the math. In his book, he showed how privatizing Social Security and government schools, along with a reduction in government regulations, would add at least $5,000 annually to the income of even the lowest-paid workers. What does that mean? Using conservative assumptions, virtually everyone could retire with $1 million or more!
Related Topics: Right to Keep and Bear Arms
, War on Drugs
, Eminent Domain Protections
, Free Market
, David D. Friedman
, Health Care
, Private Property
, Adam Smith
, Lysander Spooner
Lies and Leviathan
, by James Bovard
, Future of Freedom
, Aug 2006
Describes the deceit used to institute and expand the U.S. Social Security program, as well as various other programs such as job training and placement, the No Child Left Behind Act, the Office of Strategic Influence, and various duplicitous officials
Social Security is the single largest government aid program and the big lie of domestic politics. From the start, the Roosevelt administration deceived Americans about the nature of the program. People were endlessly told that it was an insurance program that would give them vested rights akin to a private contract. But in a 1937 brief to the Supreme Court, the Roosevelt administration conceded that Social Security "cannot be said to constitute a plan for compulsory insurance within the accepted meaning of the term insurance" and characterized Social Security as a "public charity" program ...
Morality and Social Security
, by Robert Sirico
, Future of Freedom
, Dec 1999
Discusses the effect of the U.S. Social Security program from an ethical and social standpoint
Is it right that the young be taxed to enable the government to provide a generous retirement program for able-bodied older people? ... Just as parents care for their young now, it was once well understood that the middle-aged have a moral responsibility to care for their aging parents. This establishes a social link between the generations, an interdependency which is essential for the continuity of values and habits of a mature people. Social Security has gone a long way toward severing those ties, freeing people from the responsibility to care for their own parents. It also reduces the incentive to have children ...
Reform Social Security ... or Repeal It?
, by Jacob Hornberger
, Future of Freedom
, Jul 2000
In the prelude to the 2000 U.S. presidential election, counters Bush's proposal to reform Social Security and Gore's claims of jeopardizing it, with a call for outright repeal
What would happen if Social Security were repealed? Many retired people would get along fine because they don't need the money. Others would go back to work, which is not necessarily a bad thing, even for people in their 60s and 70s. What about the truly needy? Would there be old people starving in the streets? Nonsense! This is what family values are all about. And if families won't care for their elderly, then there are neighborhood groups, churches, civic organizations, and charitable organizations ... as misguided as it is, the very existence of Social Security reflects that there are lots of Americans who do care about others.
The Repeal of Social Security
, by Jacob Hornberger
, Future of Freedom
, Nov 1995
Argues for the outright repeal of the Social Security Act of 1935 quoting Bastiat in his advice against using the law as an "instrument of equalization"
Where did the idea of Social Security come from? It ... came from Otto von Bismarck, the Iron Chancellor of Germany, who had pushed Social Security through the German Reichstag in the 1880s. Under the guise of saving America's free-enterprise system ... Franklin D. Roosevelt looked to Otto von Bismarck as his model ... The constitutionality of the Social Security Act was decided by the U.S. Supreme Court in 1937 in Stewart Machine Co. v. Davis. The American people came close to being spared sixty years of Social Security, for the decision was a close one — five to four in favor of upholding the law.
Rose Wilder Lane (1886–1968)
, by Cato Institute
, Mar 2003
Part of Cato's "Three Women Who Launched a Movement", celebrating during Women's History Month the sixtieth anniversary of the publication of The Discovery of Freedom
(as well as Isabel Paterson and Ayn Rand books published in the same year)
Lane was not merely a theorist, but an activist as well. In 1945-46 ... She also grew her own food to avoid wartime rationing, and later quit her editorial job with the National Economic Council so as not to pay Social Security taxes. Her prescience regarding the instability of that system was astonishing: throughout the 1950s she would describe it as unstable and a "Ponzi fraud." Lane told friends that it would be immoral of her to take part in a system that would predictably collapse so catastrophically, as the example of Weimar Germany convinced her that it would.
The Social Security Fraud
, by Sheldon Richman
, Sep 2001
Discusses comments made by Treasury Secretary Paul O'Neill indicating that the Social Security Trust Fund has no tangible assets and the response from Rep. Charlie Rangel
O'Neill is right. The Trust Fund is a figment of our collective imagination ... Every cent that the American people pay in FICA payroll taxes is immediately spent. Anything left over after the current retirees are paid off goes into the general treasury where it is used ... The Social Security Trust Fund is credited for that money in the form of nonnegotiable bonds that purportedly earn interest. What if there was no trust fund at all? When FICA revenues fell short of retiree benefits, as they will in about 15 years, the government would have four options: cut benefits, cut other spending, raise taxes, or borrow.
Social Security Has to Go
, by Sheldon Richman
, Jan 1998
Examines the U.S. Social Security system, including the employee and employer "contributions", the "trust fund" and how it may fare in the future
Even though Social Security never explicitly calls itself a pension or retirement insurance system, people have certainly been led to think that it is. Each pay period, workers are forced make what are called "contributions," and when they retire, they are to receive benefits. The system is riddled with dishonesty. First of all, when the government forces a citizen to make a contribution, it's a tax and nothing else. Second, the money is not put away or invested in order to earn interest and yield benefits for retirement later on. From the beginning, the money was used to pay benefits to current retirees.
Taxation Is Robbery
, by Frank Chodorov
, Out of Step
Chapter XXII; starting with the historical origins of taxation, proceeds to examine its indirect and direct forms and the rationales behind it
Social security taxation is nothing but a tax on wages, in its entirety, and was deliberately and maliciously misnamed. Even the part which is 'contributed' by the employer is ultimately paid by the worker ... The revenue from social security taxes is not set aside for the payment of social 'benefits,' but is thrown into the general tax fund, subject to any appropriation, and when an old-age pittance is ultimately allowed it is paid out of the then current tax collections.
, by Jacob Sullum
, 19 Jun 2001
Discusses comments by George W. Bush's Social Security commission co-chairmen and criticism and remarks from others
Indeed, if the problem is the system's impending bankruptcy, personal accounts will do nothing at all to address it. The root of that problem is that Social Security, although widely perceived as a pension program, is actually a pay-as-you-go system in which current workers fund payments to current retirees. With baby boomers retiring and life expectancy increasing, the ratio of retirees to workers will rise to a point, around 2016, where currently promised benefits can no longer be covered by incoming payroll taxes ... With or without privatization, lower benefits or higher taxes are inevitable.
Uncle Sam's Retirement Scam
, by Doug Bandow
, The Freeman
, Jan 2002
Examines alternatives to deal with funding the Social Security "Ponzi scheme", from raising FICA taxes, using general tax revenues, reducing benefits, engaging in an "orgy of borrowing" or allowing people to invest privately
Social Security was long viewed as America's most successful social program. But it worked only because of demographics: when first created, dozens of workers supported each worker. Taxes were low, benefits secure. But Ponzi schemes succeed for only a limited time. When Franklin Roosevelt was posing as the savior of the elderly, almost half the people died before collecting their first check. No longer, however. Most people receive not just the first check, but many more ... as the Baby Boom bulge hits retirement in the coming years, every retiree will become dependent on just two workers, down from three today.
Libertarian Outlaw: An Interview With Jacob Hornberger
, by Jacob Hornberger
, Karen De Coster, 16 Nov 2000
Issues discussed include the Libertarian Party differing performance at the national level versus the state and local level, the philosophical views held by LP members, gradualism versus repeal, religion, the Constitution and the future of the LP
I think one is better off arguing the strong moral principle of repeal ... For instance, with social security, if you are going to argue for a plan of a reformed social security system – say allowing people to opt out, or applying for annuities, etc., – you are not going to be arguing about the immorality of the state taking money from one person and giving it to another. Your focus is going to be on why your plan is going to save these people ... But if you ... argue for a repeal of social security, it's a direct, moral, economic utilitarian attack on the whole concept itself, which I think is much more important.