Social Security is certainly social enough — the part where other people spend your money. But secure? Hardly.
Here’s what Myra Adams just noticed when taking a closer look at her Social Security statement:
At first glance, the statement did not appear menacing. I was told I could expect to receive a benefit of “about $2,136 a month” upon reaching age 70 — which certainly seems like good news. But immediately I thought of a parallel of President Obama’s infamous Obamacare promise: “If you like your Social Security, you can keep your Social Security.”
Then, as if on cue, I saw an asterisk with the following message:
The law governing benefit amounts may change because, by 2033, the payroll taxes collected will be enough to pay only about 77 percent of scheduled benefits.
I could not believe I was seeing the equivalent of what I was just thinking, but with a new twist, “If I like my Social Security, I can keep 77 percent of it.”
With an asterisk, my beloved government was informing me that they will be unable to fulfill their part of a financial arrangement into which, as their statement attested, I had been making mandatory contributions starting in 1971 at age 16.
Adams did some of the math — that the number of payees is shrinking relative to the number of beneficiaries, and concludes, “There are just too many Baby Boomers and too many financial promises with elected leaders too afraid to inflict the necessary pain of real reform.”
I mean no disrespect to Mrs. Adams, but welcome to 1985.
That’s the year I turned 16 and had my first real summer job. Like most anyone with their first pay stub, I was disappointed with, you know, the actual number left over after all the taxes were taken out. I did a little reading and learned that the 1983 Social Security reform had jacked up taxes, but added only about 20 years of solvency to the program. Conclusion: I was never going to see those benefits.
And it wasn’t just me, either. Poll after poll shows that Gen X kids (kids then, middle aged now) had little faith in Social Security being there for us, despite us paying in at the higher rates for all of our working lives.
And again, no disrespect to Mrs. Adams, but by and large we felt this way because we knew our Baby Boomer parents, and we knew their Baby Boomer friends, and we were pretty sure nothing was going to get done to fix the program. The time to act would have been in the 1990s — when the first Baby Boomer president had plenty of time, political popularity, and tax income to have pushed for real reforms before things got too painful.