Social security used to be sound, Who messed it up?

Answer 1

Social Security is fine, we just need to keep the congress and senate from borrowing from the general fund.

How about they cancel a few of those millitary contracts, then they will have all the money they need.

Ps. Anyone who thinks social security is "doomed" is too dumb to even bother explaining to why it isn't.

Answer 2

It never was. People that think it ever was are morons.

There never was, is, or ever will be a "Social Security Trust Fund." Congress can not sequester money in the way that everyone believes the "SSTF" is set up. The extra monies sent in to Washington (which soon won't be the case) are used to purchase government bonds, which will eventually have to be paid from general revenue. If we're running a deficit, which we almost always are, new bonds will have to be issued to cover those bonds.

The system was designed incorrectly and never should have been run by the government. Private individuals would get life imprisonment for the financial shenanigans the government gets away with in the Ponzi scheme known as Social Security.

Answer 3

Whoever told you that SS was ever sound is a functional idiot. From its beginning the SS fund was used as part of the government's general fund and this was unsound. Funds that should have remained allocated only for SS and invested to build the fund for future needs were used instead to feed the needs of the annual bloated budgets passed by Congress. Everyone in government aquiessed and the result is a failing system that has little hope of lasting much longer and is simply another means of collecting income tax. It is a particularly egregious tax against the poor, BTW. Look at the limits set for paying into the fund and always rememebr that the employer is paying in the same amount that you are in stead of paying you that extra amount in your pay check. I say this and even though I was one of those who exceeded the maximum limit for the last 20 years before becoming disabled and am now 'benefitting' from my contributions. I'd be much better off had I personally invested all those contributions and what my employers paid in even though I would have needed mine sooner than if I had worked until my normal retirement age.
The system is broken! It should be dismantled! pay those now drawing from it and any normally eligible until all of us have died from the general fund which used our money evry year. Start a new system based on investing the funds for those contributing and pay them according to how well the funds acrue when their time comes to draw against it. Yes, this will be expensive. What we have is expensive and unfair and getting worse.

Answer 4

Delphi gave the simplest and best explanation that I have seen. The SS system was set up on the model of the old Chain Letter or Pyramid Scheme type of con game. It was bound to fail sooner or later unless the funds were locked away and invested to make some kind of gain.

Unfortunately, we Baby Boomers and Gen X'ers didn't breed enough new taxpayers to keep the pyramid growing. One of the things that needs to be done right now is to freeze the salaries of Congressmen and Senators, along with top appointed officials in the federal government. If we make them FEEL the pain, then they won't be so tempted to allow the currency to be inflated any further. This will help what's left of Social Security be of some benefit to most of us who are alive right now.

Answer 5

Social security was sound and would have been fine until Johnson "a democrat" moved the money into the general fund to help pay for the Vietnam war. Then they never moved it back.

Answer 6

Yes, it used to be sound when you had 1 recipient for every 5 working people paying in. Now there are 3 recipients for every 1 person paying in, and the ratio just keeps getting worse as time goes forward.
Sooner or later either the benefits will have to be cut, or the taxes will have to go up.....period!
By 2040 at the current trend, the system goes bankrupt!

Answer 7

The government has been dipping into it for years and they should all have their pensions taken away and have to live on Social Security.

Answer 8

Back in 1983, Congress and Alan Greenspan and President Reagan got together and fixed Social Security so that it was sound. You can see the speech that President Reagan gave on April 20, 1993 when he told us so, here:

http://tinyurl.com/2x4r25 (Reagan on Social Security - part 1 at You Tube)

http://tinyurl.com/2doeb8 (Reagan on Social Security - part 2 on You Tube (with speeches by former Speaker of the House, Tip O'Neil and Senate Majority Leader, Howard Baker)

Prior to 1983, Social Security was a pay as you go system where FICA taxes on workers wages paid for the retirement benefits of the previous generation. The primary reason for the 1983 reforms was that Congress recognized that Social Security would have a problem when the baby boom generation retired, so the retirement age was raised to 67 and FICA taxes were raised in order to build up a real trust fund to help pay for the retirement of the baby boom generation.

What has happened since than can be explained by this Oliphant cartoon (and the two paragraph explanation under it):

http://www.sonic.net/fjf/Oliphantss.html

Basically what has happened is that congress has been borrowing and spending the surplus money that workers have been paying into the Social Security trust fund, and congress has no plan in place to pay it back when it will be needed to pay benefits. If congress had kept the non-social security budget balanced, Congress could have used the surplus to buy up government bonds from the Chinese and other investors. Instead, Congress has used it as if it were free money.

As to who as at fault for messing up social security, there is plenty of blame to go around, such as:

1. The wealthy right wing Republicans - Ever since President Roosevelt, they have hated social security, because it provides a better to return on the money paid in to middle class and poor people than the wealthy. Massive deficit spending is no accident for them. It is part of their strategy to "Starve the Beast" (destroy the welfare state) by bringing the government as close to bankruptcy as possible so that the government will have no choice but to cut benefits.

2. Ordinary Republicans - Their priorities are tax cuts and programs that benefit their supporters, even if it means running a big deficit.

3. Ordinary Democrats - Their priorities are programs that benefit their supporters, even if they have to go along with some Republican tax cuts and programs favored by Republicans. The Democrats are too cowardly to argue that the Bush tax cuts should be rolled back (not to pay for new programs) but to return the country to solvency.

4. The Voters who elected congress and the president - Nearly 2/3 of people who have credit cards carry a monthly balance on their credit card accounts. - We are a nation that is used living beyond its means. - But at least a person with credit card debt has to keep making his payments, which in most cases keeps the him from maxing out his credit cards - but when it is the country that goes into into debt, it is future generations that get stuck making the payments. It should be surprise that our borrow and spend citizens have become comfortable with deficit spending.

5. Vice President Cheney - After the 2002 election he said that "Reagan proved that deficits don't matter" and he proceeded to help the president push through more tax cuts. (See
http://www.ontheissues.org/2004/Dick_Cheney_Budget_+_Economy.htm

When Cheney said "deficits don't matter," he was not making a statement about what was good for the country (Something he apparently didn't care much about.) - He was simply stating that the voters won't punish a politician for running big deficits - so why not have more tax cuts for the people who helped get him elected.

5. Alan Greenspan - In the video of President Reagan's 1983 speech, he stood next to the president. And it was the Greenspan commission that was largely responsible for the 1983 reforms; and yet after Bush II was elected, (just after Clinton's balanced budget) Mr. Greenspan advocated tax cuts which meant that the government would return to borrowing and spending the surplus being paid into the trust fund. His advice to congress had a big part in getting the Bush tax cuts pushed through.

The one group of people who I would not blame for messing up Social Security is the Baby Boom Generation - People say the baby boomers are self-indulgent - but as a result of the 1983 Social Security reforms, they became the first generation in U.S. history to pay for their parents' retirement, while providing for their own as well.

Answer 9

LBJ messed up by creating it. this just gave the liberals more money to mess up. it was well intended but doomed from the start. First of all the Liberals who brought this mess about Had to know in their campiane to kill all the babies in america that their would be no one to pay into this thing.
now 40 years later and tens of millions of potential tax payers aborted, and milllions more illegal and illegal not paying but taking out benefits taking jobs of citizens who also take out. who is left to support the truly intitled who have already paid, but whose money was diverted to pay for midnite basket ball and long gone projects that yeilded only Urban blight and 2 whole generations in jail and on drugs.

Answer 10

Your elected representitives. They found that they could use the money for other pork projects, not related to SS, so there is no reserve. The program relys on the money coming in to pay the benifits. Thus the less coming in and there more going out... Bang. Something has to give.