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by nybble41 1457 days ago
You are correct. Nonetheless, those paying in to the system today acquiesced to the plan under the assumption that they would one day be able to take their place as beneficiaries. They gave up significant amounts of money which could have been invested toward their own retirement to pay those SS taxes. Simply ripping it away without compensation is neither fair nor realistic.
1 comments
itsumoiru 1457 days ago
> those paying in to the system today acquiesced to the plan...

No, they didn't acquiesce to anything. They were required to pay whether they wanted to or not.

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nybble41 1457 days ago
I didn't mean to imply there was anything like voluntary consent involved. I'm on your side here. But there is popular support for this program which wouldn't exist if it were presented purely as a wealth transfer with no upside for those forced to pay in. They gloss over the fact that paying SS taxes doesn't formally entitle you to any future benefits, but in practice cancelling it without offering some compensation to those who paid so much in would amount to political suicide.
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0des 1457 days ago
This brings up and interesting question: If more people enter the work force and pay taxes every year, how is SS (as im told) "drying up"? I don't doubt that it's dwindling, however, what happened?
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nybble41 1457 days ago
In 1945 there were 42 workers paying SS taxes for every retiree collecting benefits. For equal pay / retirement income after SS taxes, each worker only needs to provide 2.3%.

Today (actually since 2009) that ratio is three workers per retiree. Each worker has to provide 33%. By 2050 the ratio is projected to fall to two-to-one.

You can find the historical ratios here: https://www.ssa.gov/history/ratios.html

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0des 1457 days ago
Did we get more people not working and paying taxes, or did we get more people consuming this resource? If it is the latter, how'd that happen?
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nybble41 1457 days ago
Mostly people are living longer. When SS first started only 55% of males and 60% of females who made it to age 21 would have survived their working-age years to retire at age 65 in 1940. By 1990 that figure had risen to 72% and 83%, respectively. Life expectancy after retirement also increased, from 12.7 (M) or 14.7 (F) years in 1940 to 15.3 or 19.6 years in 1990. (https://www.ssa.gov/history/lifeexpect.html)
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