Saturday, November 17, 2012

We Are Told that SS Exists Because Some Would be Destitute in Old Age Without It

The Incidental economist has a couple of good post about Social Security here and here.

They just shows how perverse our welfare for the elderly programs are. We are told that the SS system exists because some would be destitute in old age without it.  So shouldn't that be reflected in the structure of the program? We have all been scammed by the SS system for long enough.  One sensible thing to do is to end FICA (FICA is not a tax but a "contribution"), fund Social Security though taxes and pay all retirees the same amount.  This would improve life for most Americans because they would get to spend more money when they are young and poorer and if they saved and invested they could still have more to spend when old due to greater returns on private investments.  Also since saving and investing promote growth, the economy would produce more, meaning we will almost all be able to consume more.

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