Over the next 75 years the Social Security “program is scheduled to pay out $134 trillion more in benefits than it will collect in tax revenue, according to agency data.” But long before then, Social Security will be sucking wind, and worse, sucking money out of our paychecks with ever diminishing returns because of Quantitative Easting, that is, inflation (government theft).
Liberals claim that amnesty will help the flow of new capital that will bail out the system. The argument goes that with illegals being made legal, they will pay Social Security taxes and help fund the program.
But many illegals are already paying into the system but not receiving benefits. Being made legal will make them eligible for Social Security benefits and disability. What’s going to happen when these tens of millions newly sanctioned American citizens retire? Will we open the borders and let more people in to pay for the last batch?
Social Security is a Ponzi scheme. The first people who get into the system get a big payoff, but that payoff comes with a price. Later participants are needed to fund the early recipients. (That was 30 to 1 when the program started. Now it’s around 3 to 1.) Social Security “and Medicare tax rates,” Forbes reports, “combined (and also for employers and employers, together), increased steadily from just 2.25% of pay between 1935 and 1953 to 4.50% by 1960, 6.90% by 1970, 8.10% by 1980, and 15.3% by 1990 (where it now stands). Meanwhile the income on which these higher tax rates apply has been repeatedly increased.”
What started with $3000 in salary is now more than $110,000.
If you and I devised and implemented such a plan and sold it to the public, we’d be in jail. But if the government does it, it’s called public policy. Bernie Madoff is in prison for perpetuating a Ponzi investment scheme. (Be warned that ObamaCare is a similar Ponzi program that will have a similar outcome.) President Obama is telling us that ObamaCare is working right now and will save everybody money. The same lie was told about Social Security:
“In a 1936 publicity pamphlet describing the program to Americans, the Social Security Administration pledged that after 1949 the combined payroll tax rate of 6% would apply only to a worker’s annual income up to $3,000 and ‘that is the most you will ever pay.’ Yet that 6% rate was breached under JFK (1962) and today’s rate (15.3%) is more than double the 1949 promised rate. Worse, today’s high rate applies to as much as [$113,700] of annual income, which is more than triple the inflation-adjusted equivalent of what $3,000 was worth in 1949 (i.e., $28,642). Thus instead of paying $1,718/year (6% on income as high as $28,642), we’re now forced to pay $16,340/year (15.3% on income as high as $106,800) – an increase of nearly ten-fold.
Bernie Madoff couldn’t force people to pay more to prop up his “investment” program, so he ended up in jail. But government is in the force business. If something doesn’t work, force people to pay more.
To make matters worse, “in the 1960s Congress and Treasury began raiding the Social Security fund, to finance general outlays, while leaving behind an ever-rising pile of non-tradable Treasury bonds” valued in the trillions.
Politicians only think about the next election and the money they will get for life when they finally leave office. They don’t care about what’s going to happen 30 years from now. If the economy takes a wrong turn, they can always force us to make even more “contributions” to their bankrupt programs, something they’ve been doing for decades.