Thanks to everybody who stopped in to my DIARY yesterday on Medicare and took the time to post! The comments were beautifully well thought out, and made me think quick to respond. This is what I live for!
But, as I worked my way through the comments, a jarring thought struck me. For close to 30 years now there have been two main thoughts lines promulgated by the GOP questioning the validity of both Social Security and Medicare, undoubtedly two of the most popular laws ever passed. Both are blatantly untrue, but the Republicans keep right on repeating history, like some kind of political “Groundhogs Day”, endlessly trying to pound the ball in from the 2 yard line in the fourth quarter by charging into the heart of the line, no matter how often they’re stopped. Let’s have a little fun and take them one at a time, shall we dear readers?
Medicare and Social Security are a Ponzi scam
How often do you hear this same old, tired, flogged mantra from the Republicans? That the programs “steal” from future generations to pay off current retirees. Nothing can be farther from the truth. A true Ponzi scam is a known scam set up from the start. You collect money from a group of suckers, promising them an insane rate of interest return on some new, untapped investment opportunity, and then you pocket it. You use the money from new investors to pay the say 30% return to the original investors and pocket the rest, and you simply keep repeating. There is no actual investment vehicle involved, you just keep using the new money coming in to pay off previous investors and pocket the rest. People who receive a 30% return on their initial investment are eager to invest more. Cha-CHING! When the pool of new investors dries up, you pack up your “boiler shop” and take off for a non extradition country.
But there is one small problem here. A Ponzi scheme takes into account from the start that the pool of potential investors is limited, at some point no new money will be coming in. The secret is to know when the new investments are drying up, pull the plug and get out without a trace to somewhere that the Justice Department can never get their hands on you again.
The Social Security and Medicare programs do not believe that there will be an end to new investors, for the simplest reason of all. Unless the United States of America chooses to sterilize every citizen and resident of the country upon birth, people will continue to have children. And once they reach the ages of between 18-25, almost all of them will have jobs, they’ll be paying into the system! The “pool” of new investors is and will remain constant for the long term future. The system was built on a sound principle, not a scam.
Social Security and Medicare are going broke. Quickly.
This one manages to be both conceptually true, but provably false at the same time. Social Security and Medicare are not going immediately broke, both have years of solvency in front of them. What the Social Security and Medicare programs are is antiquated structurally. You must remember, Social Security was enacted back in 1935, and Medicare was enacted by President Johnson in 1965. You must take into account the actuarial tables that they were based on. Back then, 70 was a nice old age, and you couldn’t retire until the age of 65. The programs were never intended for the government to make a profit, the goal was for each and every person to get as much in benefits that they had paid into before they died. That system worked well for many years, while the mortality rate remained fairly constant, before the influx of influence in improved health care and the influx of information about harmful habits such as cholesterol and tobacco risks.
Public perception and medical treatment has exploded over the last 50 years. Public information has been impossible to overstate in this effort. People have a great and ever growing intelligence about the healthy risks that face them, and infinitely superior medical resources to protect them from these threats. People are living longer, healthier, and more productive lives than they ever have before, and they’re entitled to live them to the fullest. That’s not just a Constitutional right, it’s a human right, bestowed on us by our creator.
The solution is almost ridiculously simple. These programs work, and they work exactly the way they were intended to, but they’re badly outdated. They need to take into account the updated actuarial tables and the increased longevity of our citizens, which is a thing to celebrate. And the best thing is that they don’t have to cost Congress a goddamn dime! All Congress has to do is to remove the artificial “cap” on earned income for the purposes of Social Security and Medicare taxes, and make “deferred income” subject to Social security and Medicare taxes, even if personal income taxes are not impacted. Social Security and Medicare will be solvent into perpetuity, and the rich will finally be paying their fair share. At least into these two critical programs. Now, that wasn’t so goddamn hard, was it?
Thanks as always for reading, you are ALL the wind beneath my wings!