Save Social Security

Save Social Security

Social Security was created during the Franklin Delano Roosevelt’s New Deal and rescued many elderly Americans from the despair of the Great Depression. When jobs,  savings accounts and those few pensions that existed in the 1930s were wiped out in that upheaval, many seniors sank into poverty and had no support systems to fall back on.

Social Security was designed so the miseries visited on the elderly of low and moderate means after the stock market crashed would never happen again. Payroll taxes on working people and their employers who contribute, in equal amounts, about 12% of an employee’s gross wages, fund the system. These payroll taxes are placed in a separate Social Security Trust Fund administered by the government to maximize the returns payable to people when they reached the age of retirement. This was done purposefully to keep politicians from raiding the Fund for general revenue needs in times when the fund carried a surplus. Even back in the 1930s, we knew there would be fluctuations in the numbers needing benefits and a need to keep the Trust Fund solvent.

Conservative republicans hate the Social Security system. It embodies all that deemed wrong with big government doing what private business could do better. Those on Wall Street cast a covetous eye on the large surpluses in the Trust Fund that they cannot manage or use for investments or rape for profit. They cast aspersions on such a social safety net, demanding that people take control over their own retirement savings and investments or suffer the consequences. They have forgotten the trials and tribulations families faced during the Great Depression when elderly parents starved and died for lack of money.

Over time, conservatives in Congress have whittled away at the Social Security System by raising the age at which a retiree could start collecting benefits, capping the amount of an employee’s wages subject to withholding, imposing means testing for some benefits, limiting disability and spousal benefits, capping cost of living increases by tying them to less than relevant consumer price indexes and others. The biggest betrayal came during the Bush years when Congress took huge sums out of the Trust Fund surpluses in order to pay for other government programs and wars.

The ultimate result set up the big lie that Social Security needs to be scrapped and replaced because the current system will not be able to meet the benefit demands that will arrive as the baby boomer generation hits retirement and current payroll tax revenues decline because there are fewer people working. That date is currently somewhere in the 2030 range and changes as does the economy.

Conservative republicans tell us that Social Security is not sustainable in its current form. They have made it that way. Their solution is, of course, to give the Trust Fund to Wall Street to manage and then pay seniors what might be left after the profiteers take their cut, assuming the managers investments make a decent return.

Political campaigns for Congress and the Presidency depend upon the votes from seniors. They vote in higher numbers than other age groups in the electorate. Candidate Trump and many members of Congress promised not to touch Social Security for those already retired or close to retirement, thinking that would be enough to secure senior support.

Democrats of the populist ilk recognized and campaigned on other positions. Raising or eliminating the cap on payroll taxable income is the easiest fix. It would pump enough money into the Trust Fund to make it solvent for decades. It is only fair that wealthy wage earners continue to pay into the system on wage incomes over $115,000 per year. Bolder folks also campaigned on cost of living increases being tied to price indices more aligned with those items seniors actually buy like food, housing and medications. They also championed increasing benefits to a more sustainable level than the average current $1,400 monthly stipend.

With the failure of the republican repeal and replacement of the Affordable Care Act effort, conservatives now turn to tax reform looking for more ways to cut taxes for the wealthy.

One of the current proposed  “reforms” is to completely eliminate Social Security payroll tax withholding. The short-term benefit will be to put that money back into employee paychecks and employer bank accounts. That is a very attractive incentive. Who would not want what amounts to a $3500 plus annual wage boost?  What they don’t tell you is that it will kill the Social Security revenue stream and bankrupt the system for sure and much sooner than currently predicted.

As you communicate with your member of Congress at one of his town halls, call or write to him, please let him know that further damage to Social Security is not acceptable and that the system needs to be fixed by repaying the money taken from the Trust Fund and raising the cap on payroll taxes subject to withholding to at least $500,000 per year. Your elderly relatives will appreciate it and so will you when you retire.