Worldview Item of the Day
No one wants to believe it will happen, but our governments, at least at the federal and state levels are going to go bankrupt. While people try to deny this is where the United States and the socialist governments of the industrialized world are headed, the evidence is already clear.
One glaring example of this evidence is the rapidly approaching insolvency of Social Security and Medicare. These two programs, upon which millions upon millions of Americans have chosen to rely, are going to cease to function as they were promised, very likely within the next decade. This cessation will result in benefit cuts to current recipients and benefit elimination for people not yet receiving benefits.
The government and astute observers have know this insolvency was coming for years. Some people have even chosen to plan for their retirements on the presumption that the money will not be there. Yet, the bulk of the government and most Americans have simply watched as the inevitable day has come.
The irony of the insolvency of Social Security and Medicare is that it is inevitable not just because those programs are running out of money, but because they were doomed to fail from the very beginning. Social Security and Medicare represent part of an endless list of government programs designed to promise to take care of people that eventually succumb to the reality that the people can only take care of themselves.
The fate of Social Security and Medicare is the same fate of the trillions of dollars in social and economic programs proposed by the Obama administration. Governments throughout history have made promises to take care of people, only to reveal that the promise is impossible to keep. In the mean time, those governments bankrupt themselves and, often, generations of their citizens in the attempt to keep those promises.
The answer to this looming problem is simple: people need to look out for Themselves. The best way to look out for oneself is to establish and maintain habits and relationships that allow one to prosper whatever is happening on the national stage. This can be a hard process to establish, but once established, it can pay dividends that last a lifetime.
DLH
I understand that if the monies collected by Social Security through the years had not been put into the general fund and spent, there would be more than enough to provide for retirees.
S. S. was never meant to be a sole source of income. It was started to help older people when they could no longer work full time.
Unfortunately, Social Security has become the sole source of income for millions who have decided to retire as long as twenty or thirty years before they could no longer work. Of course, this does not apply to everyone, but with people living longer and healthier than ever before, retiring at 55 or 60 has become a drag on a lot of things, including Social Security and the economy.
I’ll have to find it again, but I read somewhere that, even with all of the money Congress has spent from the Social Security surplus, the program would still go bankrupt because it was never fully funded. At the time, the tax rate for full funding was something like 25 percent because the rate of return at the time was less than inflation. With current return rates, we’d be better off putting our social security dollars in Bank of America.
I’m still convinced that the answer now is what the answer was when G.W. Bush proposed it in 2001: some form of individual accounts invested in a system similar to what government workers are able to invest into. Yes, such a system would be exposed to the vagaries of the market, but as was already pointed out, it was never meant to be a sole source of income.
Something else to note: the same people who were telling us that sub-prime lending was a phony crisis as recently as 2007 are telling us that Social Security bankruptcy is a phony crisis. Maybe we should all start putting our money in our mattresses.