2/25/2005 06:47:00 AM|||Toni|||Mark Alexander: What Social Security crisis?

I know most of this posting is from Mark Alexander, but he just does such a wonderful job of succintly driving home the salient points of this whole issue.

.........James Madison, who said, most eloquently, "I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents...." Madison further noted, "If Congress can do whatever in their discretion can be done by money, and will promote the General Welfare, the Government is no longer a limited one, possessing enumerated powers, but an indefinite one, subject to particular exceptions."

However, those words were long lost on FDR, who eviscerated federalism in his relentless endeavor to make the central government the agent of salvation for all ills. In June of 1934, he announced to Congress one lasting example of that endeavor -- his intent to create a nationalized Social Security program, ushering the United States into the ranks of Europe's welfare democracies. The nation was in the midst of the Great Depression, and FDR was funding his political dynasty by redistributing wealth. After all, as noted by George Bernard Shaw, "A government that robs Peter to pay Paul can always depend upon the support of Paul." FDR's plan, like all unbridled populist-entitlement programs, was popular with the democratic majority -- and helped ensure his re-election to office three times.

Here is where I have never understood people who laud the governance of FDR! He is the father of the US decay down the road to socialism. We are now finally, having to pay the piper for this slide in robbing from Peter to pay Paul. And as Shaw says, of course Paul can be relied on for support in this endeavor. Unfortunately, even supposed Conservatives find nothing wrong in
this thinking. They'll just raise taxes or raise the cap on SS which is the same thing just worded in a different way. Here's a little historical recap of the events which followed FDR's path:
........Soon, congressional amendments added benefits for spouses, minor children and survivors, and by 1950 the program assured virtually universal coverage.
****1972 saw the addition of the Supplemental Security Income (SSI) program (AKA "welfare"), ****1975 the addition of annual Cost of Living Adjustments (COLAs) assured the SS juggernaut's exponential growth.
****1977 - Medicare became an independent entitlement, spun off from the Social Security system. Today, despite its humble beginnings, the Social Security system confronts our young people with the grim prospect of paying for unfunded promises made to past generations.

...... Predictably, though, the latest retort from the Left is, "What insolvency? What crisis?" Indeed, these do-nothing Demos claim the Fed's IOUs in Social Security's
so-called "trust fund," combined with minor tweaks to the system, will keep it
solvent for generations.

.....For generations, every dime forcibly taken from worker paychecks -- ostensibly to finance the non-existent SS "trust fund" -- has been taken from that fund and applied to other massive entitlement programs.

......when SSI was formed, life-expectancy was 61 years, which is to say, most Americans did not make it to 65. Now, however, average life expectancy is 77.

So - at a minimum, when this program was initiated, retirees were not really even expected to receive benefits unless they lived 4 years longer than average life expectancy.

......President Bush has proposed the incremental privatization of some SSI taxes by allowing individuals under age 55 to invest in personal retirement accounts (PRAs). Additionally, Congress must resolve to index benefits to inflation.

Here I thought the age for the personal investment was 40 or 45! That means I might be able to get in on the deal. I like this section:

The PRA plan would "cost" about $664 billion in "lost" SSI revenue over the next ten years. Of course, this lost SSI revenue is merely revenue that's been moved to PRAs, and thus isn't available to "borrow" from the SSI trust fund for other entitlement programs -- and that's why the Demos are hopping mad. Still, all Americans need to understand that the PRA plan does not fully address the revenue shortfall crisis looming on the horizon. That crisis can be resolved only when Congress commits to bringing SSI benefits in line with SSI revenues.

|||110926122787570164|||Historical Timeline for Social Security