Even in the fire of scorched-earth politics, there are some issues that remain unscathed. Political science refers to these issues as third rails. To touch them in any meaningful way is to commit political suicide. Social security was the first issue to be referred to as a third rail of politics. It remains the most entrenched of these untouchable issues. The program has now been around for over 80 years. The bases of both political parties see it as a beloved retirement fund. And, it remains immensely popular with the broad American public. But its popularity does not change the facts of the matter: Social Security is wrong, and we must repeal it.
Social Security has an erroneous name, designed to obscure the true nature of the program. The program is, essentially, a government-licensed Ponzi scheme; Social Security steals money out of my back pocket to pay for someone else’s retirement. When Bernie Madoff did it, we righteously decried his actions as immoral. When Uncle Sam does it, the scam enjoys a 75%+ approval rating. It is an immoral program and always has been.
Social Security is incredibly unconstitutional, as well. Nowhere in the US Constitution is it written that the government is authorized to steal my money to pay for someone’s retirement. Nowhere. The program was a massive power grab by FDR. It dramatically shifted the center of power in America from the states, where it belongs, to the federal government. It made millions of Americans dependent on taxpayer money in the form of state aid. Instead of striking the program down, however, the Supreme Court cowed to FDR. We have been stuck with it ever since.
Social Security is inefficient, and a drain on our resources. The program is incredibly inefficient and costly, especially when compared to private investment.
If I paid into Social Security from age 20 to age 68, at an average income of $50,000, I could possibly receive $54,000 a year in dispensed benefits. Assuming I live to be 75, that amounts to $432,000 of total dispensed benefits. Alternately, if I engaged in private investment starting at the age of 38, beginning with $100 and adding $6,000 each year (the average pay-in annually to social security for an income of $50,000), the average market returns by the time I was 68 would be $988,000.
We are robbing our citizens of a chance to actually save for retirement by promising them money that doesn’t exist yet. And, the government cannot match what they could have accumulated if they had invested the money in the private market. Instead, the federal bureaucracy is consuming it. The program is incredibly expensive as well. The Social Security Administration spends over one trillion dollars a year to keep it operating. The idea that this kind of spending is not killing America is absurd. Our debt sits at over 22 trillion dollars. Social Security is not helping that and is, in fact, the largest mill-stone sinking us it into oblivion.
Most importantly, Social Security in its current form is going bankrupt. The Trust Fund, an account where surplus payroll taxes go to make up for Social Security payment deficits, is due to empty in 2032. At that point we will either have to raise taxes significantly or cut spending, neither of which are popular. People my age (17) will never see this money. Ever. And yet people seem not to care.
Taking the position that we need to end Social Security is bold, and politically fraught. But it is also the only correct position. The program is immoral, unconstitutional, and fiscally unsound. If we do not do something about it today, it will be our ruin tomorrow.
Editor’s Note: The working reality of the Social Security program is indeed a government-run Ponzi-scheme. But the reason that it remains so popular is because the American public thinks of it as a government-insured retirement fund. From the perspective of the average American citizen, they are putting in their own money and getting back their own money. Few understand that this is not the way the program works. Scott is incredibly salient as a 17-year old for recognizing that the government has already spent the money and that the money the retirees are receiving is somebody else’s money. -Justin