Obama Vows To Tackle Social Security Spending
by Big Dog on Jan 8, 2009 at 06:15 Political
Barack Obama says that he plans to get a handle on out of control spending in Social Security and Medicare. He claims that there is red ink as far as the eye can see. Well, Social Security is not bankrupt yet but it will be in the not too distant future. Social Security takes in more than it needs but the excess is used by the government to pay for other things. They just cannot keep their hands out of the till. When there is money, they spend it.
For the longest time Social Security has taken in much more than it pays out. Instead of being prudent and ensuring the excess money stayed dedicated to the program, Congress spent it. There are so many IOUs that they will never be paid back.
I do not like Social Security. It should have never been started but since the program is in place it should be privatized so people can invest as they see fit. I know there are people who say that the recent economic problems show why we should never do that but they are wrong. Long term, money invested in the market grows. There are periods of downturn but the periods of growth are much greater. There are government accounts that are long term and they are the ones that lose little or no value when the market is in a slump. These safer funds are what people would move too as they approach retirement. Growth takes longer but there is very minimal risk.
The stock market is much less risky than letting government handle your money. They have less than 1% return and they spend what is left. Also, if you die you don’t get to pass your Social Security on. A small survivor benefit is paid but most goes back into the pot and redistributed. If the account was yours, you could invest it how you wanted and you could pass it to your family when you died. Obama would not be seeing a sea of red ink if people had private accounts.
Bernie Madoff has been accused of running a Ponzi scheme. He took investors money with the promise fo large returns and then paid off investors with other investor’s money. He took money from one group and he paid it to another.
Social Security relies on the current worker population to pay benefits to current retirees. Workers pay it in and government sends it out. So, much like Madoff, the government is paying one group of investors with the money from another group of investors. It is the government’s own Ponzi scheme.
The huge difference is that Madoff will go to jail for bilking people out of their money with his Ponzi scheme but no one will pay for the untold amount of money that government has bilked the people out of.
Since government is involved in Social Security it is a legal Ponzi scheme. If an average person like say, Madoff, ever tried a thing like SS he would end up in jail and yet, politicians are not incarcerated.
Every president has stated he would fix Social Security and Obama is obliged to do that as well. The truth is, they cannot fix it because it is broken beyond repair.
We need private accounts and we need to control our own future. Unless Obama is planning on that, then he will fail in his efforts.
[tip]If you enjoy what you read consider signing up to receive email notification of new posts. There are several options in the sidebar and I am sure you can find one that suits you. If you prefer, consider adding this site to your favorite feed reader.[/tip]
Tags: Obama, ponzi scheme, red ink, social security