The demagogic caterwauling floating up from the Left's untenable opposition to Social Security reform should be considered a pollutant. Not only does it ignore the facts of the issue, but it creates illusory crises to divert discussion away from the relevant subject: the retirement funds of America's young workers.
Once upon a time, the Left was content to delude itself into a happy myopia where Social Security, that secular bénitier, was immune to budget shortfalls. Now, we see that such a position has completely evanesced from respectable politics. The liberal establishmentarians now spend their columns reluctantly conceding that Yeah, Social Security is going to face problems. But, for God's sake, don't overreact by giving people personal control over their retirement finances!
The Social Security Board of Trustees says the program will begin to run a deficit in 2018; Senator John Kerry has employed his talismanic prognostication powers to predict we wouldn't see problems until 2042. We then all, as a matter of reason, wonder why Mr. Kerry didn't use his crystal ball to do something like, say, win the presidential election.
At the same time, prudence is urged. Why? Social Security will collapse in about thirteen years, but maybe more, so let's count on the best scenario, relax and make some minor adjustments. At the same time, global warming might raise ambient temperatures about one degree over the next century, so let's dismantle the world economy.
These rhetorical alchemists also cite the tautology that stock investments tend to occasionally lose value. Those making that objection ostensibly derive great satisfaction from that discovery, apparently unaware that the observation is about on the level of pointing out that, well, war tends to kill people.
Peace notwithstanding, should we give Social Security a chance? We've given it seventy years, over forty tax increases, and it's still about to collapse.
Conclusion: No.
Failing that, the threatened losses from market cycles are less even severe than the imminent bureaucratic ones. As far as facts go, the average rate of return for stock values during the Great Depression (4%) was double the current rate of return for Social Security (2%). Factor in the unlikeliness of another depression, the benefits of diversification, and the 8% average annual growth rate of the stock market, and private control becomes independently desirable - even if Social Security weren't about to take a bath in thirteen years.
Investments can indeed lose value, but Wall Street is not yet known to face a $26 trillion unfunded liability.
There's more. According to its opponents, Social Security reform will siphon funds away from current and impending retirees. Possibly, we say, but we'll cover that with existing Social Security taxes. Oh, they respond, then the whole thing is going to cost money!
Rationally, short-term costs are not a self-sustaining argument against reform. Although, I certainly wish we could have, in 1935, observed that FDR's proposals would cost American taxpayers billions of dollars - and then reasonably expected that to serve as a peremptory argument to render the entire New Deal DOA.
Good ideas cost money to be implimented. Want to know what else costed money? Going to the moon.
Furthermore, the entire purpose of the reform is to prevent these future reconciliations between revenue and guaranteed payments. When the worker keeps his money, he's not worried about someone else paying for his retirement. It's rather simple.
Is the revelation that retirement funds are not parthenogenetically created not yet established economic law?
By shrewd observance that Social Security is an Important Issue, the statists present their laundry list of these specious arguments intended to stroke the golden locks of the bright-eyed youth. Rest easy, young people, keeping your own money is something you just can't handle. You don't want to put Grandma out on the street, do you?
In the end, it is not today's seniors, doyens of punditry, or public representatives who have the luxury of final determination regarding Social Security's eventual path. We are the ones who will lose the day Social Security falls into the red; we are the ones whose earnings are both the support of our current retirees and the future point of contention.
Say what you want, Senator Kennedy, but you aren't going to dupe us into thinking that we really don't want to be able to invest in our own retirement.
The spears of demagogy are dulled. We know America's seniors are the wealthiest age stratum, not the indigents they are made out to be; we know even if they weren't, Social Security's pittance of a stipend would be unsatisfactory to lift them out of poverty; we know that private accounts have oblique economic benefits.
An imagined crisis among wealthy seniors should not keep young Americans from control over our retirement.
I hold fast to ideals and expect my fellow vigenarians to reject the sophistries of socialism. We can be cozened into many questionable capitulations, but we can't be told that the meager dispensation of retirement funds from a nearly bankrupt institution is copasetic. Pundits can screech, holler, and lie, but they are not going to persuade us that we don't want to keep the money we earn.
Yes, Social Security should be a safety net. However, a safety net shouldn't have a life expectancy less than that of the retirees it is saving.
It is our retirement money. We can squander it ourselves, thank you very much.
The above work is the opinion of the author,
and not necessarily that of the Prometheus Institute.
