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The truth about Social Security: the truth behind the popular myths and outright lies of Social Security proves that this form of socialism must be rejected in favor of private enterprise.

Article Excerpt
When Federal Reserve Chairman Alan Greenspan testified on February 25, 2004 to the House Budget Committee, he avoided his customary obfuscation and discussed Social Security and Medicare in foreboding terms. Calling the ballooning indebtedness of these programs "sobering," he stated:



In 2008--just four years from now --the first cohort of the baby-boom generation will reach 62, the earliest age at which Social Security retirement benefits may be claimed and the age at which about half of prospective beneficiaries choose to retire; in 2011, these individuals will reach 65 and will thus be eligible for Medicare. This dramatic demographic change is certain to place enormous demands on our nation's resources--demands we almost surely will be unable to meet unless action is taken.

Within his remarks, the Fed chairman called for "changes" in the system that must "involve lowering claims or raising financial obligations." One way to lower claims, he offered, must begin with a recognition that people live longer and, therefore, "significant structural adjustments in the major retirement programs" should be initiated. He specifically suggested reducing cost-of-living increases and pushing up the retirement age.

Greenspan's suggestions, like others proposed and acted upon in recent years, have always amounted to placing a band-aid on a mortal wound. Cato Institute's Michael Tanner, the author of the recently released study Social Security and Its Discontents, claims that "a better measure of Social Security's financial crisis is its actual cash deficit." When measured in constant 2004 dollars, "the total amount that its expenditures will exceed its revenue from 2018 on ... is an astounding $26 trillion--$26,000,000,000,000.00."

President Bush, in keeping with standard Washington procedure, appointed a commission to study the problem. He even suggested allowing younger Americans to divert a minuscule portion of their Social Security taxes to an individual investment account. But the impending crisis remains: Taxes for Social Security have risen dramatically and the program's payouts continue to escalate even faster. If our nation is ever to survive more than six decades of this form socialism and vote-buying profligacy, Social Security must be reexamined from its inception, halted and phased out.

Since both Republican and Democratic Party officials refuse to tackle the problem realistically, Social Security will likely not become an issue in the 2004 presidential election--even though it should. Ignoring the looming emergency, however, won't make it go away. And expecting current political leaders to address the completely unconstitutional nature of the entire program is unrealistic--unless an informed citizenry forces the issue to be addressed.

The Awful Truth

The Social Security tax currently stands at 6.2 percent of gross wages up to an annual income of $87,900; this tax must be matched by another 6.2 percent from employers. In addition, a Medicare tax demands an additional 1.45 percent of all income, also forcibly matched by one's employer. Government's take for each employed Social Security participant, therefore, amounts to 15.3 percent of what a job is worth to the employee/employer combination--a hefty chunk, particularly considering this tax is in addition to other payroll taxes. Had these amounts been demanded when Social Security was initiated, the program would never have been born.

Budget figures published by the Social Security Administration (SSA) project that the agency's cost will be $524 billion in Fiscal 2004. This amount far exceeds the budget for the Defense Department, even including the war against Iraq. Payments are now sent to more than 50 million persons every month, close to 18 percent of the population, a figure that will begin rising dramatically in just a few years when the baby boomers retire.

The official SSA budget reports that collections will total $668 billion in Fiscal 2004. According to a variety of SSA publications, practically all of this revenue (minor exceptions...