Today the government announced that Social Security recipients will begin receiving a 3.6% increase in their benefits beginning next January. This increase is the result of a mandate that the amount of money in benefits will automatically increase every year based off of the COLA (Cost of Living Adjustment) which seems to adjust primarily based on inflation. As we all know, Social Security has been an object of dispute in U.S government recently. Governor Perry claims that the system is essentially a Ponzi Scheme, while others claim that Social Security is necessary and perfectly viable. So is Social Security a safety net or a Ponzi Scheme?
As the system is set up now, the current recipients of the Social Security are being provided their benefits from the working citizens of America who pay Social Security taxes. In the Ponzi scheme, investors where repaid with a profit based solely on money that the next wave of investors would invest. The issue is that it relies on the next wave being larger than its preceding wave or the scheme just falls apart. This can certainly be related to the Social Security system because it also relies on the next wave of people to repay the people that already paid into the system while they were working with the expectation of receiving compensation when they finally retire. It is similar to the Ponzi scheme because it completely relies on the next wave of working tax-payers to provide them with their promised benefits. However, it is dissimilar to a Ponzi scheme because the government is not looking to make a profit on this system, but to provide a pension for the retired citizens to live on once they no longer have an income from working.
Logically, we can not just leave the elderly and disabled to fend for themselves. We live in the greatest nation on the planet and a major reason why we are so great is that we never fail to protect our own. I would hate to see the day when society foolishly turns its back on our parents and grandparents who helped us all as we grew up and who took care of us when we could not yet take care of ourselves. After all, we will all hit the the same point eventually and a little boost to what we can spend every month would undeniably be appreciated. Even our oldest ancestors had systems set up in their very primitive societies to care for their elderly citizens. They simply became "elders" and "witch-doctors", people with a lot of life experiences and wisdom to share with the rest of the community. This abundance of knowledge and wisdom was enough for them to be provided for. Today, our senior citizens can still provide us with marvelous gifts of knowledge and wisdom.... AND they have already paid into the system so that they will receive their pensions in return. To try to strip these people of the service that they have already paid for and clearly need is just a crime against humanity.
There is just one problem... Our government has already engaged in deficit spending and has created committees to try to find a solution to this problem. President Obama is even now considering changing the way that the COLA is calculated so that it will have less of an annual increase. With the national debt that we have already accumulated and continue to accumulate, we will now be adding approximately $26,000 million dollars to our government's annual expenses. They are struggling enough to make ends meet already! (number of citizens to receive the increased Social Security Benefits. (55 million) and the average increase in dollars per year (about $467), provided by fox news and CNN)
To answer my question that was the reason for this article, I believe that Social Security is a necessary safety net and is NOT a Ponzi scheme because it does not have selfish intentions. However, it does have the same failing strategy that the Ponzi scheme had, which is bad news for everyone retiring in thirty years or more since they will have been paying into the fund through their taxes, only to find nothing in the jar for them later on. Something needs to change about this system and the answer is NOT to increase taxes on the working American citizens who are already being burdened by the downtrodden economy. Instead my challenge to the people who run our government is to find a way to reform the Social Security system so that people are not getting screwed (for lack of a better term). So to those who want to keep Social Security, what other government services or agencies are less important and that we can do without so that we can fund Social Security? We are going to have to make some sacrifices. To those who believe that Social Security needs to be discontinued, is there something else that we can remove to trim the fat off our countries deficit spending without throwing our seniors into the lion's den?
No comments:
Post a Comment