It's Time to Fix Social Security

Thursday, 10 Mar 2011 08:49 AM

By Brad Blakeman

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How many Americans remember Paul Harvey? Harvey was a legendary radio broadcaster delivering news and commentary in a plain talking common-sense style that was never divisive and always informative.

He started in radio at the age of 14 in 1933 in Tulsa, Okla., reading news and producing ad spots. For his lifetime of achievement in radio and journalism he was awarded the Medal of Freedom by President George W. Bush in 2005. Harvey died in March of 2009 at the age of 90.

In 1985, at the age of 67, Paul Harvey aired a radio commentary warning the American people of the untenable funding and benefit obligations of Social Security.

His words are as true today as when he said the following 26 years
ago: "Many Americans believe that any discontinuation of Social Security is just unthinkable: 70 percent of Americans believe it should provide a basic standard of living and 90 percent of Americans oppose any cuts whatsoever in Social Security benefits and yet at the same time, the same survey reveals that most Americans think their taxes are too high and 86 percent of Americans consider our federal budget deficit a serious problem. We all want it both ways ­ lower taxes and high benefits.

"With 1 in 6 Americans receiving some or all of their income from Social Security it is understandable that Congress is unwilling to do anything but to increase Social Security benefits.

So, that brings us to the serious problem of our budget deficit of which Social Security is a substantial factor.

Because of the broad based support for Social Security, lawmakers are going to keep it alive by transfusion or whatever, for as long as they can. But, if future increases are geared toward inflation, it may make Social Security cost prohibitive and thus COLAs, [cost of living adjustments], which 80 percent of Americans support ­ such increase would not be sustainable.

"Retirees are going to want to see a lot of other extravagances curtailed first, but pruning Social Security will be less objectionable only when it is the alternative to national bankruptcy."

Well, Harvey was right. Lawmakers kept Social Security going by propping it up with tax payer borrowed transfusion after transfusion, decade after decade, knowing full well that sooner rather than later it was destined for insolvency.

So, why is Social Security going broke? In 1940, (five years after Social Security was enacted), an American had to attain the age of 65 to receive full benefits. In 1940, however, most people never made it to 65. That is not the case today. The average life expectancy today is 76 while the age of full retirement benefits is 67. Do the math. There are too many beneficiaries.

Social Security is funded from taxes taken by current workers to pay the benefits of current retirees. Today money goes in and goes right out.

Current workers contributions are not being "saved" for their benefit in the future. In 1950, there were 7.3 working-age people for each person over 65; now the ratio is 4.7 to 1, and it is predicted to drop to 2.7 to 1 by 2035.

Do the math. There are not enough people paying in.

The reality is this: Americans cannot work 40 years and then retire for 20 on the government's dime.

For decades Congress has either raided Social Security funds to pay for other than retiree related expenses or they have totally ignored the reality that Social Security is destined for insolvency unless and until it is totally and completely retooled and salvaged at great political turmoil and resentment by the public.

Everyone of working age knows they are going to get screwed in their retirement and not get that which was either paid in or promised by the government. The question for Americans is this: Would you rather have some government supplied retirement or none at all?

The day of reckoning for Social Security has come. For decades politicians from both sides of the aisle have been equally incompetent in their failure to fix Social Security at a time that would have caused less disruption and public consternation.

Now is the time to fix Social Security for generations to come because, the alternative is nothing short of a national catastrophe.


Bradley A. Blakeman served as deputy assistant to President George W. Bush from 2001-04. He is currently a professor of politics and public policy at Georgetown University.



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