Yesterday I received my first Social Security check! I opened up my online banking account and there it was! Tell me, just how do you celebrate that milestone? I thought about burning my AARP membership card but couldn’t remember where I put it. So I thought I’d head over to the senior citizens center for consolation but couldn’t find my car keys. By then it was time for my nap.
One thing I am going to do is stop listening to the great debate over social security. It can make you crazy. I read a column by economist Robert Samuelson calling my social security check "middle-class welfare that bleeds the country.” Wow! That seems harsh.
A Forbes magazine columnist said social security is a “Ponzi” scheme. He made this argument, “Say you’re Bernie Madoff! (YIKES) You start by convincing a small group of people, say five of them, to each give you say $1,000, with the promise that each month thereafter, you’re going to give them $50 back. That works out to $600 over the year, or a 60% rate of return. Not too shabby! These people are a little skeptical at first, but the promised 60% rate of return seems worth the risk.”
That’s an interesting analogy. Indeed Charles Ponzi added investors even though a financial analysis would have shown if the new money ever stopped flowing the dominoes would fall. The problem with that comparison is Mr. Ponzi did not have the full faith and credit of career politicians whose re-election depended on their ability to make good on the commitments he Ponzied up!
I get the part about social security being funded by taxes being paid by today’s workers in order to pay the benefits of those of us who are now retired. Since the day in 1964 I started washing dishes at the Little Bear Inn, I have been paying taxes to the federal government so it could pay social security to those who retired before me.
The problem seems to be there are fewer workers today per beneficiary than there were in my dishwashing days. Back then the ratio was about 7 workers paying taxes for every one person receiving a check. Today there are only four. The solution seems clear. Those four just need to get second jobs! Then the worker: beneficiary ratio will be back to its 1960’s level. Right?
I don’t remember a time in my life when politicians weren’t warning us social security would run out. Even so, they sent me a check yesterday. But today it continues to be front and center in the discussion about how to reduce the budget deficit. I can’t tell who knows what they are talking about and who doesn’t. But I figure they don’t dare change what current recipients are receiving. As of today I am one and so the debate is ultimately about someone else, to wit those four young workers who are propping me up in retirement…and I suggest they best get back to work!