Social Security and the Survival of Your Retirement—
Social Security is not related to the federal deficit. It is funded by a tax that is withheld from your earnings during your working life. That money goes into a nearly $3 trillion trust fund that is healthy even though it can easily be made still healthier. More about this later. Repeat: The deficit will not be reduced by reducing or privatizing Social Security. The deficit has nothing whatever to do with Social Security. No matter what you are told by politicians and Wall Street parties slavering to get their greedy hands on this huge sum, Social Security is healthy and does not affect the deficit. Anyone who tells you otherwise is lying.
Do you want to privatize Social Security? Let me put it more clearly: do you want your retirement security put in the loving hands of Wall Street? Memories are short, so let me refresh yours: the recent recession that affected the entire world and from which we have not yet recovered was based on risky and even criminal behavior by Wall Street. My own retirement nest egg was reduced by nearly 40% in a matter of a few weeks by the meltdown, and I’m not unusual.
Wall Street is where investment is God. It is run by ambitious people who are subject to the all-too-common flaws of ignorance and greed. Despite what you may think, the conditions leading to the Great Meltdown have not been curbed but are largely still in place thanks to a political establishment whose existence depends on the gifts from the world of high finance.
Eliminations of safeguards—deregulation—starting in the Reagan era and permitted by both parties (albeit the flawed Republican philosophy of mythical “free markets” has largely governed), have been eroded by congress and the conservatives on the Supreme Court. The current Tea Party-dominated House of Representatives wants to further erode the few safeguards that still exist and enhance the fortunes of the 1% who support these congressmen and women.
I don’t give a hoot who you voted for or your party affiliation. What I am doing is paring away the deliberately confusing rhetoric (or downright lies) thrown at you by the political establishment and a compliant media. Too many people I know, relatives, small business owners, the forcibly unemployed, retirees, just average folks have been diddled and lied to by the politicians for too long for me to sit silently on the sidelines. That’s why I have written this piece on Social Security, your lifeline in retirement, the average person’s lifeline in retirement.
Consider this: since 2009, 95% of the income gains have gone to the top 1% of individuals in the United States. Let me repeat that fact: since 2009, 95% of the income gains have gone to the top 1% of income earners. That’s the reason you should be concerned about the renewed negotiations in Congress. Your retirement income will be in play. Your Social Security will wrongly be part of the negotiations.
Just so there will be no doubt about the truth of what I am saying, I hold the philosophy that until we eliminate the gross inequality that exists in the United States, the worst since the Gilded Age, we will suffer a decline in both democracy and the financial security of the little folks. The rich people are the ones who benefit from the system now in place. While I would be ashamed to admit to being a Republican, I have considerable policy differences with the Democratic administration if not all the Democratic Party. However, given the structure of the American two-party system, I will more likely come down on the Democratic side on social policy simply because it is more humane and realistic.
So please pay attention when the budget negotiations are under way. The Republicans want to slash so-called “entitlement” programs (read that as Social Security and Medicare) and President Obama has said that “entitlement” programs are on the table and has even suggested that Social Security be “chained” to a stingier consumer price index. As stated above, this “chained CPI” would significantly reduce the amount retirees receive. As I have already said repeatedly, Social Security has zero to do with the deficit. Bluntly put, your Social Security is at risk.
Raise the Cap—
Before closing, a few words further on my statement in the first paragraph that Social Security is healthy and can easily be made even healthier. The simplest way possible to improve the long-term health of Social Security is to raise the cap on Social Security withholding to last dollar earned rather than where it stands today, $13,700. With the exception of Sen. Bernie Sanders and a few others who want the cap to be raised to $250,000, this has been all but ignored by congress. Why? Because the wealthy people in American society don’t want to pay their fair share. The simple fact is that the wealthy people would find the tax from a raised cap to be a relatively insignificant part of their income (pocket change is the appropriate phrase) while any proposed cuts would be borne by the small wage earner, particularly if the “chained CPI” measure is adopted and the age of eligibility is raised. Put bluntly, such cuts would noticeably reduce the amount retirees receive.
While at Fox, like all the executives I got a “raise” every year when my earnings hit the cap, but the rest of my staff paid the tax all year and did not get that relief. That seemed to me unfair then and still does. It’s an easy fix and one you should strongly agitate your congressional representative to support.
Considerably more could be said in support of this simple fix, like returning the amount taxed to the 90% of total income level of the Reagan era instead of the 80% currently in effect. That’s a separate subject for discussion that could be addressed in the future. However, suffice it for now to say, simply raising the cap to last dollar earned would solve any remote doubts about Social Security’s future. Support improving Social Security, not undercutting it. Don’t listen to the lies. Demand that the cap be raised.