Saturday, January 05, 2008

Social Security


By Richard E. Noble

Social Security is almost in that category with religion and politics - one should avoid talking about it in mixed company. But of course it is a subject not only important to Eastpointers, both young and old, but to everyone.
I am going to try and avoid getting into the standard debate on this subject and try to come at it from a slightly different perspective.
In reading my history books I have formed some unconventional opinions about the system and it origins and initial supporters.
When we listen to the detractors of Social Security today, it would appear that Social Security is/was some sort of a welfare program that was forced upon the better-off by some sort of conspiracy on the part of the poor and struggling.
This is not true.
Initially all programs designed to assist the workingman and non wealthy were dreamt up by fraternal worker organizations and labor activist from the ranks of the American Communist, Socialist, or other labor groups. These type people seriously freighted Republicans especially - the Democrats had their problems with them also. This is true.
In consequence of this fear and intimidation there were many Republicans who were on the Social Security band wagon in the early days. They were called for the most part “progressives”. But there were even some conservative Republicans who were also in favor of Social Security.
In the early 1930’s and those depression years, who do you think was left with the burden of all these homeless, old, unemployed and disabled? Why the rich, the wealthy and the better off.
Just like good old Scrooge in Charles Dickens’ “A Christmas Carol” someone was always knocking on their door asking for a handout or wanting support for some charity or pressing their nose up against the window overlooking their table at their favorite restaurant, or picking through their trash, or robbing their homes and businesses.
But the old and sick were a particular problem, more depressing than the lazy, dirty, abusive unemployed and their disgusting, obnoxious children - the old brought up that much hated feeling of guilt and social responsibility and Christian brotherhood. You know - what would Jesus do?
There were some real scary liberals out there too - with considerable political support - like Huey Long who had some real harsh ideas.
The Kingfish’s basic plan was to grab up all the rich people by the heals, turn them upside down and shake the heck out of them until all their money fell out of their pockets and their bank accounts. This was very similar to what the poor (Bolshevik - workingman with family) had already done in Russia.
Less radical liberals just wanted the rich to put up the money for the Social Security unemployment and old and disabled insurance plan. But the conservatives in their compassion - bless their hearts - didn’t want to destroy the spirit, independence and self-respect of the poor. They suggested that the poor be forced to put money into a plan for their own benefit. They would be glad to deduct it for their wages and hold it in a safe place for these unfortunates until they needed it.
Believe it or not the legislators compromised on a plan where both the employer and the worker paid into this social insurance plan. And all, both prosperous and not prosperous, would receive benefits in accordance to the amount they paid into it over the course of their lives.
In that way, one day all the old, poor and sick, would hopefully be off the streets and the rich and wealthy would be able to recoup some of their loss and not get the whole financial burden.
So originally the idea was supported by the better off to force some financial responsibility onto the socially less productive. And the better off wanted the system to be mandatory because if any choice were allowed - the poor and financially irresponsible would be the first to drop out.
If the poor were not forced to pay into this program, they would never volunteer or keep up with their payments. The payments were, of course, small enough that the employers and the better off could easily manage their share. And besides, in the end, everybody would get a piece of the action. The employer would even be able to turn a portion of his cost over to the consumer. So everybody paid and everybody got some benefit.
The bottom line - we had an economically feasible and morally fulfilling program that solved numerous inadequacies, social and systemic problems, operating within a system that was being criticized around the world as being cruel and heartless.
Up until this time the Social Security Program, despite all the moaning and groaning, has been one of the best bureaucratically managed and socially beneficial programs ever in the history of this country.
One last interesting and conservatively depressing comment.
Poor working people, middle class and all those who earn less than $80,000 per year pay their proscribed share of the Social Security tax all their lives. And they pay on every dollar they earn.
Those who earn over $80,000, pay only on the first $80,000 of their income. Even if they earn $200,000 or ten million, they only pay on the first $80,000. Percentage-wise the lesser earners pay a greater percentage of their lifetime earnings and get a substantially smaller share.
Many of the better off are collecting premiums as high as two thousand a month and more. While low wage earner who paid on every penny that they ever earned get as little as three and four hundred per month. The better earners who pay more in actual dollars may deserve their higher incomes but actually the lower earners have paid a higher percentage of their earnings over their lifetime for their much smaller share.
I’ve have read that all of the shortfall in the coming baby boomer crunch could easily be compensated for by simply removing this gratuity or wealth-fare benefit to the better off.
So what’s the problem?