The Social Security Scam

How should we think about this intragovernmental debt? The Treasury department collects $100 in Social Security taxes, the SSA spends $70 on Social Security benefits, and the other $30 goes to, let's say, military spending. Since $30 was collected for Social Security, but spent on the military, the Trust Fund now has $30 of bonds. The bonds are simply promises of future taxes. The feds collected the money for Social Security and now they are going to collect taxes again for Social Security spending. The $2.4 trillion of bonds in the Trust fund represent Social Security revenues that need to be collected a second time, since the tax revenues did not go towards Social Security spending when they were initially collected. In fact, all of the intragovernmental debt represents future higher taxes.
source

I found this article very eye-opening and decided to post it. It explains in detail how intragovernmental debt works and how they are, in general, screwing us with that system. It goes on to explain how workers pay ~12% of our income into the system and how, by 2016 the system will be insolvent and will require new taxes to keep it afloat. There's got to be a better way to handle things than this.


TA

Social Security = the ultimate ponzi/pyramid scheme!

Wonder when the government is going to arrest itself for this ponzi scheme?

reply to post by inthesticks


Yep.

From the article:

Social Security is a "pay-as-you-go" system. This means that when you work, the government takes your money and gives it to Social Security recipients. In order to get workers to accept this system, the government promises to take other people's money and give it to you when you retire. Think of it as an exponentially larger version of Bernie Madoff's Ponzi scheme.

But it's ok when the government does it. It's for our own good. After all, they know best.

Thanks for the reply, post starred.


TA

Yep, as a child of the 50's I saw this system and wondered about it. Emotionally it felt good to me. But even in my 7 year old mind I wondered how it could continue. Just about that same time as I was pondering this, our family was filling up the gas tank of our car at the gas station and I asked my mom, what will we do when we run out of gas? And she told me to stop asking silly questions. It will never happen.

This system is a massive income-redistribution scheme, taking one-eighth of most workers' incomes. The total tax burden is hidden from the workers. The tax revenues have been used to cover the deficits in the rest of the government's budgets, and the only way to make the system sustainable is to give the participants a negative rate of return on their money.

The Social Security system has run its course. It's unfair and it's economically destructive. It's time for the program to be abolished.

(from the article)

It is most definitely time to, at least, overhaul the system, if not abolish it. The system is abusable , inefficient, and just plain falling apart at the seams. Something needs to be done.


TA

reply to post by kyred

stop asking silly questions. It will never happen.

I think a lot of people took that attitude toward the social security system.
But here we are, less than a decade from when it's predicted the good times will be over and nobody is doing anything. Where are our representatives when you need them?

reply to post by TheAssociate

Agreed, it's time to abolish Social Security. It's a black hole of wasted money.

Regardless, why should I pay into it if it will be empty long before I turn 65? I should at least be allowed to opt out if they won't abolish it.

reply to post by ChrisF231

I should at least be allowed to opt out if they won't abolish it.

I agree 100% but we're never going to convince anyone in authority of that: they're making too much money from it. By the time we're old enough to collect, benefits won't be there but we'll still be paying the tax.


TA

I don't see it as a scam at all. The right wing wants you to think that though...it was fine until Ronald Reagan raided it so he could pay for his tax cuts for the rich. That should have never happened and Clinton should have stopped it but didn't. It has been a tragic and egregious violation of trust but it can be fixed.

Again, the right wing very much wants you to believe that no government program is successful so they have made sure that they aren't....kissing the a** of the corporations for thirty years.

Im 21 right now and between the Baby Boomers and the inevitable amnesty of the illegals I have no doubt that the SS fund will be empty by the time im 41.

reply to post by ChrisF231

It's going to be difficult but it can be saved. The right wing wants you to believe it's doomed and was misguided to begin with, hating as they do everything FDR did to make this country right. They want to set up impossible moral dilemmas inside of yourself. Don't buy it. Doomsday and fear is what they do to you.

No civilized society kicks their grandparents to the curb. Cutting back on useless military programs and rolling back the tax cuts for the rich will solve this problem but there may be other solutions that are more creative...just please don't fall for these doomsday scenarios. You'll be glad you paid in when the time comes. Trust can be restored in this country but it's going to take some time as the fears you speak of were very carefully created and planted in you.

I do think we need to do something about the illegal immigrant problem and if there is amnesty it should be very limited. The feds have left the border states on their own. It's time for the feds to do the job and that is to protect our borders. It's a federal responsibility.

Originally posted by ChrisF231
Im 21 right now and between the Baby Boomers and the inevitable amnesty of the illegals I have no doubt that the SS fund will be empty by the time im 41.

Dude, don't say things like this as if you knew them to be true.... those "BAD ILLEGALS" have been paying into a system they were not entitled to get anything from nor will they ever be able too....

making statements like this just makes you look like you don't know what your talking about. face it the government has been using the funds like others have said as SLUSH fund....

like every other scam ... last one out gets ....................... NADA