The Chicago Tribune editorial “Perry's Ponzi point: (Tuesday 13
September) does a public service opening with the rarely stated fact
that Ponzi investors “had a choice about participating” but
Social Security is compulsory.
Any discussion of Social Security must recognize four undeniable facts:
1) No wage earner has ever sent in a penny to the Social Security
system. All such money has come from employer bank accounts.
(Would 100 million wage earners dutifully send in a personal check
every month for 1% of every pay to DC?) It has been a tax on
employers from the beginning. The Commerce Department's 2011
Statistical Abstract of the United States says that in 2009 this was
36% of all the taxes the Federal Government took in that year.
2) If employers don't remit this tax every month, they go to jail, never
the wage earner. Employers did get to deduct it from the employees'
first checks after implementation, and every time there was a 1%
bump in the rate, but 99% of all the money that's been credited to
wage earners has come from Employer bank accounts, not wage
3) Employers have an out: since all employers must do this, they
have no competitive advantage to do anything but add it to the cost
of their product, thus converting 'worker contributions' to a silent
national sales tax. This fractured the crucial link between taxpayers
and voters. Instead of voters writing monthly checks to support the
federal government, they have drawers full of statements saying “you
earned and your employer paid.” The government owes it to you!
4) No one is suggesting fixing this by stopping payments to current
Social Security recipients - there is no need to: There are 40 million
people over 65 in the US receiving $683 billion every year, but 2.5%
of them are dying every year, so in 40 years, the problem solves itself.
And what's $683 billion anyway? Barely a healthy stimulus.
There are alternatives. Companies like Prudential, New York Life,
John Hancock. etc sell products called 'annuities'. Some say these
companies are big, thus greedy. Yet you work thru an agent down the
street. Are they big and greedy?
If they stopped requiring employers to send in money, would they give
it to employees? Or would they use it to hire more people. Create jobs,
The Supreme Court has never been asked to decide the Constitutionality of
the Social Security Act, but its 1961 Fleming vs Nestor decision
(deciding a single individual's right to benefits) said: “The
non-contractual interest of an employee covered by the [Social
Security] Act cannot be soundly analogized to that of the holder of
an annuity, whose right to benefits are based on his contractual
We must stop pretending that current workers are covered by a legitimate
I've lived in Detroit, St Louis, Kansas City, Pittsburgh PA, Marblehead MA. Worked as tech rep in Southern CA, Bay area, NYC, I've been to Europe a dozen times (Ireland, UK, Scotland, Sweden, Finland, Belgium.
Favorite restaurants are Gene & Georgetti's in Chicago, Roma Cafe in Detroit, Frankie and Johnie's in NYC, Rigazzi's on the hill in St. Louis (Also Charlie Gitto's, was Angelo's when I went there.)
For about a year I had small offices in Clayton MO, in the Country Club Plaza in KC. I rode a ten-speed bike around Lake Michigan (The bottom half in one week in June 1978, another week for the top half in 1980, used the Badger both times.
Don't get to travel much anymore, but still try to rent a car and go around the Lake in March every year. Sure, there's still snow, and it's not warm, OTOH there are no bugs and no toursts. Greatest little tavern in the world is Sherry's Port Bar in Garden UP MI