Tuesday, January 6, 2009

The Social Security Time Bomb

I’ve heard that the peak years of Social Security will occur around 2015, plus or minus a year or two. From that point on, Social Security will nose dive; a ticking time bomb. And, so far, no solution has been proposed that really works. Social Security is a good idea. If it isn’t saved in essentially its current form, millions will suffer.

Thank God that the voluntary program Bush proposed wasn’t approved by Congress. That’s not the answer. Had it been approved, J. P. Morgan, Goldman Sachs, Merrill Lynch (now bankrupt), Lehman Brothers (also bankrupt) and other big investment banks that have been devastated would have lost the entire trust fund in speculative gambling in the markets. So, something else has to be done.

The Social Security program was always intended to be paid for by those currently employed. In the 1950s, the ratio of employed to social security recipient was nine to one and very few of the nine made enough money over the Social Security “cap.” Today that ratio is two to one and many make more than the cap. The whole idea from the start was that “full employment” would be a foundation element of the U.S. economy. So, what happened?

For one thing, companies began sending jobs overseas to avoid their tax burden, including their social security tax burden. They found that they could be “non-country” companies by exporting jobs; neither taxed in their home country nor under laws of the employee’s country. The idea of “Full Employment” hasn’t been a concern of corporations or on the Republican platform since before President Reagan, and for the majority of the time since Reagan Republicans have been in power. According to reports, Obama is going to impose an “extra” tax on U.S. companies that export jobs overseas. Part of those taxes should go to the Social Security Trust since exporting jobs has cheated the trust in the first place. The ratio of worker to recipient needs to rise, even if it considers the exported job.

The other obvious thing that has cheated the trust is the so-called Social Security cap, $102,000 in 2008. The cap raises a few thousand dollars every year. But, the cap actually represents a middle-income wage in the richer states, such as California, and many in those states are able to avoid social security contributions for most of the year. The cap should be eliminated entirely so that all employees contribute the full year. Of course the real reason for the cap is not to benefit the wage earner; it is to benefit the corporation who would have to divvy up its share. The cap is just another Republican scheme for corporations to rip-off our nation. There is no end to Republican duplicity.

Medicare is just as crucial and in as deep a hole as Social Security. It, too, must be saved by similar taxes. U.S. based corporations have to do their share, or we will have millions of aged poor in soup lines and in great need of healthcare. Of course there are still many stupid “Joe the Plumbers” out there who will end up on Social Security, but fight against their own best interests while they’re working. Social Security, and Medicare, taxes are the best investments you will ever make. They are your safety net.

I’ll say it again. I will never again vote for a Republican. They have damaged our country more than any foreign enemy.

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