The 112th Congress should:
- allow young workers to redirect their payroll taxes to individually owned, privately invested retirement accounts.
- sell federal assets which do not assist the government in fulfilling its Constitutional obligations, and use the proceeds to pay promised (vested) benefits until all Americans are out of the Social Security system.
- return retirement planning to individuals
- How Long Have We Known?
- Are we just now finding out that Social Security is a fraud?
- No, we've known from the beginning. Here is an article written by Clarence Manion, the former Dean of the Law School at Notre Dame, written back in November of 1955.
Dean Manion reveals that
- • The U.S. Supreme Court approved Social Security in 1937 as a taxing scheme.
- • The Court said Congress did not have to set the Social Security "contributions" aside for people's retirement.
- • Even if Congress chose to stop paying all Social Security benefits, it could still withhold Social Security "contributions" and use them to fund Planned Parenthood and the War in Afghanistan.
- • "The fraud of the great deception is the deliberate and official misrepresentation of social security taxes as payments of insurance premiums for the right to get back specified benefits at a specified time. There is no such right."
- • The "trust fund" contains government I.O.U's, not assets, on which interest must be paid, requiring more taxes to be levied.
- • Testifying before the Ways and Means Committee of the House of Representatives in 1952, the chief actuary of the Social Security Administration said, “The present trust fund is not quite large enough to pay off the benefits of existing beneficiaries”
- • If you are paying social security taxes now, there is thus $15 billion less than nothing in the fund that you are supposed to be accumulating against your retirement and old age. Small wonder that the Secretary of the Treasury
recently testified that “under the present provisions of collections and disbursement the Old Age Survivor’s Insurance system is actuarially unsound.”*
* Congressional Record, July 5, 1955, page A 4871.
- All of this was published in November, 1955, more than 50 years ago.
The "Trust Fund" now has more than $15 TRILLION less than nothing.
have known for decades that they can claim they "didn't raise taxes" because they're spending your social security "contributions" for the same wasteful and unconstitutional projects they spend your taxes on.
Do you really believe the elections in November 2010 are going to bring "CHANGE?"
The Bad News:
Such headlines -- common enough -- are just the tip of the iceberg.
You could have had a million dollars or more to provide for your retirement years, and could have been able to pass that on to your children and grandchildren. Instead,
Every penny you have "contributed" to Social Security has already been spent by the government on countless government boondoggles. It's GONE.
The pittance that the government will pass on to you when you're retired -- collected from those still working -- will not keep up with government-caused inflation, and all that you "contributed" while you were working is not your property and cannot be passed on to your heirs.
The Social Security system is a fraudulent and unethical system.
Even Enron officers are not as unethical; if they administered a private pension or insurance program in the way the Social Security system is administered by the government, private sector managers would have been imprisoned long ago. The system is an insult to the elderly and an infringement on the liberties of those who would rather
provide an adequate future for themselves and their posterity.
The Social Security Fraud
More Bad News:
What if the GOP embraced Paul Ryan’s entitlement plan?
What the Future might be like.
The Good News
A privatized retirement program would allow Americans to invest in America. Putting money in stocks capitalizes American business, increases the productivity of labor, and lowers prices. Private retirement accounts can be passed on to one's heirs, unlike all the money put into Social Security. Instead of receiving checks for $1200/mo, the elderly could
receive checks of three-, five- or even ten-times that amount. This would mark an end to the "prescription drug" crisis. Even during the Great Depression, the stock market yielded better returns than the Social Security system does.
|Enron is old news. Sorry; haven't had time to update this page with post-BushBailout links. But the same analysis applies. Even in a recessionary era of foreclosures and unemployment, capitalist social security is a better deal than socialist social security.
The recent Enron scandal and stock market decline does not change the long-term historical fact that Americans know how to invest better than the federal government, and should be permitted to do so.
- Privatizing Social Security the Right Way
by Laurence J. Kotlikoff
In this article I present
the main outlines of a plan for fully privatizing the retirement portion of Social Security. The plan was developed by me and Professor Jeffrey Sachs of Harvard University. It has been endorsed by sixty-five leading academic economists, including three Nobel laureates. The plan is simple enough to describe on a single page. It
protects existing retirees, women, and the poor, has very low administrative costs, requires full portfolio diversification of account balances, forces contributors to invest for the long term, transforms accumulated account balances into inflation-protected pensions at retirement, and fully pays off the liabilities of the old
system in a generationally equitable manner.
- [S]tudies suggest that this reform would, over time, increase the economy’s output by roughly 15 percent and the capital stock by roughly 40 percent.
- The Social Security system does lots of useful things. It forces us to save and to insure, and it protects us from running out of money in old age. But the system was financed from the start on a chain-letter basis, and the end of the chain is in sight. We now have two options. We can try to
con our children and grandchildren into buying our inherently worthless chain letters by continuing to disguise the true nature of Social Security’s long-term fiscal problems. Or we can decide to act like adults and reform once and for all a system that imperils the financial well-being of our offspring.
This article is adapted from testimony to the U.S. House of Representatives, Committee on Ways and Means, Subcommittee on Social Security, June 3, 1998.
Still don't like the Stock Market (in spite of the facts)? Invest in annuities, which still pay three times as much as Social Security. Civil workers in Galveston County, Texas enjoy much greater benefits than they would receive through Social Security, with no retirement funds invested in stocks:
Lessons from Enron
What the Enron Scandal Means to You
A Silly Comparison to Enron
Memo to Whining Enron Employees
Which is worse: WorldCom or Congress?
Military waste under fire / $1 trillion missing -- Bush plan targets Pentagon accounting
Accountability for Whom?
Foundation for Economic Education
- Senator William Proxmire: "...there are 37 million people, is that right, that get Social Security benefits?"
- Social Security Commissioner James Cardwell: "Today between 32 and 34 million."
- Proxmire: "I am a little high; 32 to 34 million people.
Almost all of them, or many of them, are voters. In my state, I figure there are 600,000 voters that receive Social Security. Can you imagine a senator or congressman under those circumstances saying, 'We are going to repudiate that high a proportion of the
"Furthermore, we have the capacity under the Constitution, the Congress does, to coin money, as well as to regulate the value thereof. And therefore we have the power to provide that money. And we are going to do it. It may not be worth
anything when the recipient gets it, but he is going to get his benefits paid."
- Cardwell: "I tend to agree."
(The Social Security System, Hearings Before the Joint Economic Committee, Congress of the United States, 94th Cong., 2nd Session, May 26 and 27, 1976, pp. 27-28. Washington: Government Printing Office, 1977.)
Harry Browne has suggested selling off surplus property unconstitutionally held by the federal government to fund a fully-paid up annuity for those currently
dependent on the bankrupt Social Security system.
next: Cultural Agencies