Social Security--A Deprivation of Liberty

The U.S. Social Security system has been hailed as a modern miracle.  Who, after all, would dare criticize a government program that would provide financial freedom for folk in their golden years?  But, take a closer look at Social Security, and it doesn't look so good.

Here are some salient points about the U.S. Social Security program:

• According to Jim Powell, author of "FDR's Folly", the American people of the 1930s never demanded that that government set up a Social Security program, because they were happy with managing their own retirement funds.  Rather, FDR pushed it through for his own political reasons.
• FDR and his cronies designed the system in such a way that it would be political suicide for anyone to to suggest that we shut it down.
• The official Social Security retirement age was set at age 65, which also happened to be the average life expectancy of an American in the 1930s.  That could suggest that the government never really wanted to pay out.  But, the Social Security administration's line on this is that the average life expectancy back then was lowered because of higher rates of child and infant deaths.  Still though, there's no doubt that most adults did didn't live as long as what many adults live today.
• No, you don't have either a savings account or a "lock box" that's associated with Social Security.  Instead, people who are currently working pay their Social Security taxes to support the people who are currently retired.  As the population ages, the ratio of working people who are supporting the retired people keeps getting lower and lower.
• Therefore, the government keeps raising the official Social Security retirement age in order to stretch the funds that they collect.  I'm 59, so my official retirement age is pegged at 67.  Young people who are just entering the workforce have an official retirement age of about 70.
• The rate of return from Social Security taxes steadily keeps getting lower.  At first, Social Security income was non-taxable.  Now though, it is taxable.  As both the rate of Social Security taxation and the retirement age keep getting higher, the return keeps getting lower.  Young folk who are just entering the workforce can look forward to a negative return on their "investments".
• Money placed in private retirement accounts would earn a much better rate of return, and people could start using it whenever they decided it was time to retire.

The federal government forces us to contribute to the unsustainable Social Security system, whether we want to or not.  The federal government then reserves the right to either slash benefits, tax benefits, or to raise the retirement age whenever they damn well feel like it.  So yes, when we have a government-run retirement system that we can't opt out of, and when the federal government tells us when we'll be allowed to start drawing our hard-earned retirement money, that is truly a deprivation of liberty.

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