Per CNN and other media outlets, when Florida Gov. Ron DeSantis ran his first campaign for Congress in 2012, he expressed support for “privatizing” Social Security.
They predict, with little surprise, that this should provide red meat for attacks from former President Donald Trump and from Democrats, should DeSantis announce a presidential run.
If indeed this is the case, it adds credence to Nikki Haley’s slogan for her new campaign that we need a new generation of leaders.
The president who brought us Social Security, Franklin D Roosevelt, told the nation in his first inauguration in 1933, in the dark days of the depression, “The only thing we have to fear is fear itself.”
Roosevelt gets high marks for courage and leadership. The problem was not that he was bold. The problem was what he did.
Today, again, the nation badly needs bold leadership. And what needs to be done is undo the damage that Roosevelt did back then. Most of the profound fiscal and social problems that we face today trace back to Roosevelt’s actions in the 1930s, most specifically his signing Social Security into law in 1935.
The constitutionality of Social Security was challenged in 1937 in Helvering v. Davis. The argument was that Social Security violated the Constitution’s 10th Amendment, which prohibits action by the federal government not specifically enumerated in the Constitution.
The Supreme Court found Social Security constitutional by offering a new, sweeping understanding of the constitution’s “general welfare” clause in Article 1, Section 8: “The Congress shall have Power To Lay and collect Taxes … (to) provide for the common Defence and general welfare.”
General welfare had always been understood to be about implementation of explicit authorities enumerated in the Constitution. Now general welfare could be just about anything the congress wanted to do.
Helvering v. Davis and Social Security opened the door to today’s modern welfare state.
Social Security was the nation’s first “transfer payment” program, in which one set of taxpayers could be taxed and that revenue used to transfer to others for purposes that congress deemed in the “general welfare.”
Per economist/blogger Scott Grannis, transfer payments now tally up to about $4 trillion annually, almost two-thirds of the federal budget. They now constitute over 20% of Americans’ disposable income, compared to 5% in the 1950s.
In case some still think Social Security is an investment retirement program, please think again.
It is a welfare state transfer program, in which taxes those working now pay are used to make payments to those currently retired.
Shortly after Social Security became law, there were more than 40 working and paying taxes for every retiree. Today, because of increasing life spans and decreasing birth rates, there are three. The Congressional Budget Office says that Social Security revenues will fall short by 23% of obligations by 2034.
The welfare state idea does not even have an American pedigree. It has its roots in 19th-century European socialism.
Our fiscal problems today are not about accounting but about principles. We need to restore American principles of ownership and freedom.
This would be a great boon. Particularly to low-income Americans that social welfare programs are supposedly helping.
Per the Committee to Unleash Prosperity, if a single person earning 45% of national median income could invest 10% of their income in a diversified stock/bond portfolio over a 40-year working life, rather than paying Social Security taxes, they could purchase an annuity at retirement worth $37,784, compared to $11,923 that they would get from Social Security.
With all the cries about the wealth gap in the country, per the Federal Reserve, only 34% of Black households, and 24% of Hispanic house, own stocks, compared to 61% of white households.
By restoring American principles of ownership and freedom, we can fix our fiscal problems and make every American healthier and wealthier.
Star Parker is president of the Center for Urban Renewal and Education and host of the weekly television show “Cure America with Star Parker.” To find out more about Star Parker and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.
Social security was a good idea so long as it remained a “What you put in is what you get out”,,,,and pay as you go, but like most nationalized programs that collectively do for THE PEOPLE that which God designed individuals to do for themselves, always turns into more dishonest social distribution of honest government wealth, taken in by socially weighted and manipulated amounts that favor incompetent failures and punish the competent earners, that when the careers of the controlling established politicians come into jeopardy, in order to protect those in power, just jump into national debt faster than Frog dumped into a fast boiling pot of COVID infected water. Social security is the greatest scammed Legalized Ponzi Scheme in the history of mankind, and only succeeds to the extent of the Federal Governments ability to print or borrow more money, with a doomsday clock that would have gone off years ago had it been run like an honest business, instead of a political party fund raiser. The Constitutional concept of “General welfare” was nothing close to the Welfare state created today, that secures the welfare of established politicians and one major corrupt Democrat party. Promoting THEIR kind of “General Welfare” gives the same kind of failed disasters awaiting for a happening as Promoting the Biden Crime Family to run our General economy and military Generals.
IT was a decent idea, TILL THE GOVT got their fangs into the blood bank that was the coffers.
Social Security started as a forced retirement plan with additional benefits for widows and orphans. Much has been added since. If what a worker put into it plus the contribution of the boss had been kept in an account for the worker’s retirement, the issue of getting more than was contributed would not even be discussed. Properly and conservatively invested, the retired worker would get at the qualifying age, much more than is now collected. For example, instead of $X a month, it could have been $2.5X. The danger of such a sound plan would be bad management, political temptation to raid the funds, or the issuance of bonds backed by the funds.
I wonder, if folks instead of havng SS taken out and put into a GOVT FUND, had it auto taken out, and put into a PRIVATE 401k like fund, whether that would be better?