A Stitch in Haste

To review: Social Security can be viewed, conceptually, as either a system of compulsory retirement saving, or as an intergenerational wealth transfer. It cannot, however, be viewed as both simultaneously. Its defenders must pick one paradigm or the other and run with it, lest they be rightfully dismissed as disingenuous.

Furthermore, while Social Security (as a unified program of taxes and benefits) is obscenely progressive in its redistributionist outcome (an individual who pays twice as much in Social Security taxes as someone else receives far less than twice as much in benefits), that is not the same as saying that Social Security is an “anti-poverty program,” for three reasons:

1. It does not cover the non-working poor (i.e., who never pay into it).
2. It is not means tested.
3. A program that seizes one-eighth of a lower-income worker’s paycheck — week in and week out, over an entire career — simply cannot be called an “anti-poverty program” under any sane lexicon.

Don’t believe me? Then perhaps you’ll believe the Social Security website:

The Social Security program is not and was never intended to be a program to provide benefits based on need. Rather, it is a system of social insurance under which workers (and their employers) contribute a part of their earnings in order to provide protection for themselves and their families if certain events occur.
…
The main source of Social Security income is the taxes that employees, employers, and the self-employed pay. This method of financing Social Security — a payroll tax on workers and their employers — remains the primary method of financing the program. The Social Security program has won widespread public acceptance and support largely because it is directly supported by the people who receive benefits from it.[*] Both benefit amounts and Social Security taxes are based on the worker’s earnings under the program. This aspect of Social Security helps to avoid any implication that the benefits are a form of government assistance or public charity.

That page is part of Social Security’s “Kids and Families” subdomain. Here’s more from the “Kid’s Place” page:

Social Security is your piggy bank for the future. You save by making payments of part of your pay to Social Security as you work. Later when you can’t work Social Security will pay you Social Security checks.

I can forgive the authors of this web page, designed for young children, for not including a footnote about Fleming v. Nestor. But grown-ups know that sometimes we fudge the truth a bit for children, to protect them from truths that they’re not ready for. The problem comes, however, when we fudge the truth, not a bit but a lot, to delude ourselves about truths that we’re not ready for.

Children grow up — do Social Security’s apologists?

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*Via Perfect Substitute, where I also very much enjoyed this comment:

“The Social Security program has won widespread public acceptance and support largely because it is directly supported by the people who receive benefits from it.”

Wow. Wow all over that sentence.

Indeed.

Previously:
–Has Social Security Been a “Success”?
–The Working Poor, Retirement and Social Security
–Some Thoughts on American Poverty

Filed under: Social Security