please explain social security to me?

Question

Wouldn't make sense to get out of it what you put in to it. Why is the money almost gone?

Answer 1

Social Security is a ponzi scheme. The way it works is simple. You collect money from workers, today 'for thier retirement' - you then use that money, immediately, to pay currently retired workers, today. Years later, when the workers who have 'paid in' want thier money back, you take money way from those who are working at the time to pay them.

As long as you have a growing population, you can give retirees more money than they paid into the system.

America no longer has a growing population. Thus, when the last generation that was larger than the preceding ones - the 'Baby Boomers' - hit retirement age, the system will start to collapse.

Answer 2

First of all the money isn't almost gone. It is gone. It has been gone for decades. Unlike a pension plan where the money is invested in securities like the stock market, the govenment just spends it as part of the general fund. It only really exists as an IOU on a ledger sheet.

For many generations, benefits have been paid out from money workers are paying in. The problem is the baby-boomer generation. Right four working people are giving their SS money to one retiree. By the time the Baby-boomers hit retirement age, there will be only two workers per retiree. In other words, each worker will have to pony up much much more to support one retiree.

It ain't gonna work.

.

Answer 3

Social Security -

The idea is that the government felt (quite rightly) that people weren't handling their own retirement benefit affairs properly, so SS was created to prevent an over abundant number of people becoming dependent on federal and local aid, the idea was to collect a small sum from each persons paycheck and this money would be put into an interest baring system and expected that over a 20-30 year period would mature and create enough coverage to cover the people who are retire, this is expecting a percentage to never retire, never make it to retiring, and die over time. What went wrong? People who had paid into social security are increasing, much higher than was initially expected, people are dieing at a much lower rate than expected (thanks to modern medicine), this is not where the problems end. In the 60s the federal government pressed through a bill allowing the government its self to access this money and use it to fund other areas of the government, with the expectation, but not requirement, that the government will pay its self back with interest, this pay back almost never happens. On top of that to reduce the dependence on the government funding of a portion of society with due to disabilities and circumstances can't work it was made possible for these people to collect a portion without ever having work and without having to pay it back if they ever do work. The government has done a fine job of leaving it's soon to retire people dependent on the people who are working, the only way this will continue to work is if we get a portion of the population working and paying in greater than those retired and retiring collecting, which isn't going to happen and can't be sustained if it does. To add to the problem there is an increasing amount of pressure to make SS optional, which I don't completely disagree with, if this is actually allowed most Americans under the age of 35 will probably stop paying into SS and the entire system will begin to collapse.

Answer 4

I'm afraid there is no decent answer to your question because what has happened to social security is very indecent. In the same way that Congress is responsible for violating the public trust by failing to secure our borders (making both 9/11 possible and creating all of our illegal immigration problems), Congress, in its grand style of negligence and incompetence, has also created the issues we face with social security possibly going bankrupt in our lifetime.

Here's what happened:

Some time in mid-1980's, the Social Security Trust Fund had a $45 billion surplus (more money than they needed). Congress had a huge deficit (spent more than they had) in gov't operating expenses, so they raided Social Security to cover the deficits. (see "America: What Went Wrong, p. 58). This illicit practice is probably still be going on, which is why Al Gore wanted to put Social Security in a "lock box" to prevent any further raiding of the cookie jar.

PLEASE NOTE: If a corporation tried such monkey business - for example, raiding the retirement fund to cover the lease payment - someone on the the board of directors could expect to go to prison. However, Congress loves to exempt themselves from harsh laws like OSHA requirements and so forth.

I wish that were the end of the story, but, unfortunately, it gets worse. Social Secuirty and Medicare are paid for with FICA "contributions" (taxes). This is the most regressive tax you can imagine. You MUST pay the tax. There are no deductions that reduce these taxes, and the CATO Institute says that nearly 80% of Americans pay more in Social Security taxes than they do in federal income tax. What's worse, before FICA gets withheld from your check, Uncle Sam counts it as TAXABLE INCOME! That's right - your income taxes are based in part on money that you never see - FICA withholding - a tax on a tax!

Deficit spending is a separate issue, but, fortunately, there is a bill before Congress to eliminate both income taxes and FICA taxes, replacing them (plus gift and estate taxes) with a nat'l retail sales tax. It's a great plan and far more popular than the current tax system or any other tax reform proposal. (see here: http://justmakemeking.blogspot.com/ click "US Tax Code - The Flaw Of The Land")

So here's a partial solution: Tell Congress (your two Senators and House Rep.) to either pass the Fair Tax or expect to get fired from the cushy job they have spending your money!

Answer 5

Well, some say the government takes money out of it. I dont know if this is true. But I do knwo that many people of age to ghet SS benefits now never worked in their life. Back when the reitrees of today worked it was the men who worked and the women stayed home. So now you have 2 people drawing off of 1 persons contributions. Doesnt make much sense does it

Answer 6

Anyone who works and pays taxes, also pays social security. For years, money has been siphoned away from it by many administrations. The amount you get is determined by your last 10 years income. You get a percentage of that. That percentage amount has been lowered over the years and the retirement age has been raised.

Answer 7

Have no fear Bush has millions of IOU's in the Lock Box, he will surely wants to pay it back. Get that lost money and pick up those IOU's and when he does you will have nothing worry about but if he reneges then Bye , Bye, Social Security, just trust him. Hmmmmmnnn

Answer 8

BECAUSE, parents tell their kids to "act out" in school so that they can be diagnosed with a disability and receive a $890 check every month.

BECAUSE, there are lying, able-bodied people cheating the system (aka FRAUD).

BECAUSE, some people refuse to work, even though they are able to work. They "claim" a bogus injury so that they can collect.

Basically, there's too much fraud and abuse going on. That's why!

Answer 9

IT IS MONEY EARNED FOR YEARS OF WORKING HARD (IF YOU ARE AN AMERICAN CITIZEN) IF YOU GET HERE WITHOUT PUTTING YEARS OF WORK--- YOU GET IT FOR JUST CROSSING A BORDER.