Economic Facts and Fallacies: Social Security, The American Pyramid Scheme

                                                                Acknowledgements 

Firstly, I would like to personally thank Stanford's Hoover Institute, the many editors, writers, and everyone who is involved in production, research and entanglements. Secondly, I would like to take the time to thank Peter Robinson, who is the main interviewer and producer at the Hoover Institute. Finally, and most importantly, I would like to thank the brilliance of Thomas Sowell, Milton Friedman and Walter Williams, for without them I would most likely have entered through the mainstream socialist and left leaning liberal pipeline that we so commonly have today. Throughout my studies in economics, two have been most significant, that being the likes of Thomas Sowell and Milton Friedman. I recognize these men as the two pillars and fathers of modern economics. 

 

Introduction 

I was brought up in a small family, my household consisted of me, my mother and her partner. Being a recipient of public schooling, I had not known academic success in all of my years. I had always heard the lack thereof in funding by the state and city. As a child I would never question the reliability of the claim that my school, “just didn’t have enough funds.” As I grew with age, I began to wonder why it was that even with the innumerable funding dollars the school I had grown up with had stayed in the past. It is an oxymoron to say that it did not grow, as it grew in its wasteful conquest on the taxpayer, and changing its curriculum to focus on the times of today rather than basic arithmetic, reading and writing. 

 

The Myth of Good Intentions 

Good intentions can be found in most of the numerous government programs. Throughout the overreaching hands of big brother, we can find that contemporaries of social welfare will argue that programs such as social security, Medi-Care, public schooling and rent control would only benefit society as a whole. When one questions the legitimacy of these programs, they may find themselves bombarded by leftist for being, “heartless,” “greedy,” or even “cold blooded.” But why is it that when a question is presented towards the orthodoxy of economic policies that one must contain traits of an inhumane person or a dehumanizer. It is hardly nuanced to say today that free speech is anything but free. As one can lose their job, livelihood, family, friends or good image as a whole for having a view contrary to popular beliefs. Firstly, social security, which is one of the big three untouchables in politics, those being that which is previously stated, Medicare and the Department of Defense. Social security, meant to act as a social net for the unfortunate few and poor, is now seen as a Godsend in today’s America. That which was created to protect the poverty stricken in the 1930s, is now of widespread use for the middle class and even rich. One cannot site a greater example of an economic and political orthodoxy changing so swiftly than that of social security. What seemed to be looked down upon from the 30s-60s is now protected by uneducated voters, politicians and media companies. To the contrary of orthodoxy, social security is not only a burden upon society but a noose that strangles the promised everlasting freedom of the American taxpayer. Social security in a sustainable manner, is to gather a share of the wealth by the many fortunate to give to the few that are poor. But the contrary has been seen and done in the last 50 years, we have flipped this sustainable and reasonable system on its head. As social security enters its several year of being over-budget, we find that instead of the many paying for the few, it is the few paying for the many. And the few are being robbed without a say. Most taxpayers go without a say for the purpose that it is a “formality of society,” or seen as just another unalienable orthodoxy that shall not and cannot be infringed or questioned upon. Social security takes more than 1.4 trillion dollars a year from the American taxpayers as a whole. With this absorbent amount of taxpayer dollars, one may ask how efficiently and or with what level of need are they being given out. If asked, you would find a politician saying, “We must save social security.” But why is it that social security is in need of saving at all? Social security as of today has more recipients than it does people paying into it. A program built on a foundation of “We take now from you, to give to you later,” which in essence would not be the worst result of the program. But when one examines the true findings of the program as of today, they can see that it has transformed into a program that no longer lives on the beliefs and foundation of yesteryear but is quite the opposite. Today's social security is made on the core stance of “We take now from you for those who were promised their retirement and give only to them for the remainder of your working years.” Now, social security not being built on these principles almost seems like a shell of its former self. What was to be a program that involved an unjustified tax but still had an implicit use of individualism, now grew to be a program that raises the egregious tax of the past ten-fold, to fund older retirees. Social Security forms at its base, an uneducated super-pact of voters who are uninformed on what their taxes are truly being spent and on whom they're being spent. If the Social Security Administration were honest, you would read from their website, "Forcing you to pay for the promises of the past, made for those in the present, while we are unsure of what your entitlement will be in the future." Social Secuity is propelled by the notion and societal stance built on helping the poor. Politicians will vindicate anyone who goes against the orthodoxy by attaching the names to someone's image, these names can span from, "inconsiderate," "greedy," or even "cruel." The dehumanizing language can make someone with a different opinion seem ignorant, making them less likely for their views to be adhered to. Those that say, "I want my money, I am entitled to my money," could not be more wrong. The money that taxpayer X has had forcibly taken out and put away is not set for taxpayer X, but that of taxpayer Y. To elucidate, no one is getting their own money. Everything one pays will go not to them, but someone that may be hundreds of miles away. And likewise, to those who state, "People need social security to live and or survive," are still sadly mistaken. Not for the reason that this statement is incorrect, quite the contrary, poor individuals may need social security to live. Yet, if one really cared for the people that they claim are so dependent upon this system, then they would not only want, but advocate for these poor people to have their money put into the stock market since day 1. The average American over their lifespan will have forcibly been taxed about 367,000$ and receive 383,000$ from this obsolete system. Now if the same amount of money was put into Berkshire Hathaway, staring in January 1st, 1996, said American would have an astounding amount of 4,051,079.52$. Assuming that one's account performs at a fourth of this, they still would have an amount far greater than that of which the social security provides, that amount being 1,012,769.88$. This amount is still staggering, the average American is being robbed of 625,769.88$ [(1,012,769.88-383,000)] by the current orthodoxy of social security. If presented to a contemporary of social security, one could be berated for even questioning the current system. Yet, when provided with evidence, it is apparent that there is a solution to the current obsolete and slow turning machine named, "social security." There is nothing secure about what the program does. The program inhibits poor people by disfranchising them from potentially, an even greater abundant amount of wealth waiting for them once they retire. The myth of good intentions is meaningful, but at what distance do we draw the societal line on how much can be taken from the taxpayer to fulfill that intention. Yes, good intentions are potentially what move a society positively in certain instances, but when and why should a society's movement be deemed and made responsible by the sole proprietor of the taxpayer, who is only losing in this situation. Good intentions do not equate to good outcomes, history will show time and time again, that only in instances where man is acting in his own interest, is where society progress most.

The Solution

To challenge the behemoth orthodoxy of the Social Security Administration, one could offer a plethora of ways to save the American taxpayer, rather than the often-rescued Social Security Network. One way would be to continue the practice of taking taxpayer dollars, but actually using them on the taxpayer, who's wealth was extracted from them forcibly, instead of curtailing the current affair of entitling others to said taxpayer dollars. As a compromise, the system could adopt the policy of investing the money taken from the taxpayer into the free market. Taxpayer dollars should be allowed to grow through the free market, not strangled by the set threshold by an unelected bureaucrat in Washington, whom may be hundreds of miles away from said taxpayer. Allowing a taxpayers social security fund to grow through the private market would grow someone's eligible social security pay by 4 times. Provided that a free-market solution would be untouched, only the stock market would deny the dismay of overreaching taxes taken out of the final allotted take-home pay from the social security fund. Some may combat this stance by saying, "The free market is not guaranteed, what if the stock market fell!" And to that, in history, when have we seen once, the down-spiral of the stock market without a recuperation on the latter of 10 years or less. Not once has the stock market stayed completely down. In a free market there will be losers and winners, socialist and capitalist, right and wrong, but in the American stock market, there are only long-term winners. Those being of the successful many that keep their money in the market will have never known a time that their stock market, if being in Nasdaq and or S&P 500, would have never deprived themselves of economic freedom. And the basis of social security is a long-term program, it would be best to give this program a chance to see long term success in the private market.

Israel Alexander Brown Prevail