Because social security tax is simply a tax like any other, and social security is a pay as you go means tested entitlement program like any other.
Current workers pay for current retirees. There is no account anywhere with your name on it earmarked for your retirement.
It was enacted with lawmakers well knowing this - it was simply marketed in such a way to make it politically possible to enact and keep around long-term. If it were pitched as an additional tax and spend welfare program it’d have never gotten off the ground to begin with.
Without your dollars going in today, current retirees would not be receiving meaningful benefits - as their contributions largely went towards those retired while they were working. The whole idea is more of a social contract between generations than anything else.
I understand the perspective and I don't disagree with it, but the problem that spawned social security doesn't go away. It takes a crushing amount of time and money to take care of your aging parents, unless we go down a very dark route, and many elderly are abandoned and it becomes a societal mess.
Some approaches I was mulling over:
1. The easiest way is to dilute SS without pushing the years down even further is to remove the required COLA adjustments.
It's probably the easiest; also the least imaginative; and may be too slow.
2. The other is what the other poster mentioned: Real social security really comes down to your kids; and this is what I think should be the basis for a "new deal".
This has to be done very carefully--I can see so many ways this can be abused--but longer-term I think giving some sort of tax break or even tax credit--based on the social security numbers of the parents--allocated by the parent(s).
For the family that can't do it full-time, they can then use that credit or offset to hire some help.
Thoughts?
Edit: I went through this but with hired help. It was both necessary and awful; and I wish I had an option to help my parents directly full-time, but I didn't have the means at the time (I suppose I still don't).
Edit 2: Fixing social security alone doesn't address the wider fiscal problem. It's almost a drop in the bucket. Healthcare is the problem.
The American elderly are in 2025 the richest generation to have ever existed in human history. Elder poverty can be solved with a comparably much smaller transfer scheme than what we have crafted.
It’s a tax. You could describe any beneficiaries of a tax in the same manner; we’re paying taxes to at least partially cover group X - homeless, scientists, military, retirees, veterans, etc.
There’s no debt being paid; money is simply taken from Peter, and money is simply given to Paul.
It’s not a retirement program, it’s retirement subsidization.
I don't think I'm willing to grant you Social Security as a proper "tax" or "subsidy" unless you're going to pitch me that Social Security is really, in essence, an incentive program for unrestrained natalism to keep population above replacement with all the Manifest Destiny/imperialistic implications and aspirations that come with it, and further, a commitment by the people who started it to never under any circumstances inform descendants of it's true nature.
If you are willing to concede the above, I'll reclassify it as a proper "subsidy" insomuch as it was a law that was passed, and it is a clear act by the government to incentivize activity "X". At which point my discussion will quickly turn to "Holy shit, why are we still trying to empire build in the year of our Lord 2025? Shouldn't we have changed this by now?"
If not... Still seeing it as a Ponzi. A fundamentally degenerate and unstable financial model, intended only to benefit the people who have been in it the longest solely for the purpose of self-enrichment. Well branded, mind; who doesn't want Social Security? But a Ponzi in essence nevertheless.
Without sufficient automation, all forms of retirement are inherently a Ponzi scheme, unless there is a cap to the age or amount of benefits received in retirement.
Current workers pay for current retirees. There is no account anywhere with your name on it earmarked for your retirement.
It was enacted with lawmakers well knowing this - it was simply marketed in such a way to make it politically possible to enact and keep around long-term. If it were pitched as an additional tax and spend welfare program it’d have never gotten off the ground to begin with.
Without your dollars going in today, current retirees would not be receiving meaningful benefits - as their contributions largely went towards those retired while they were working. The whole idea is more of a social contract between generations than anything else.