Social Security

Reason Writers Around Town—The Key to Entitlement Reform

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In today's Washington Times, Reason-Rupe Polling Director Emily Ekins examines a path towards entitlement reform: 

..the poll then asked respondents who oppose reform if they would be open to reductions in their Social Security and Medicare benefits if they were still guaranteed to receive at least the amount of money they have contributed to the system. Suddenly, 61 percent of Americans were open to accepting reductions in Social Security and 59 percent were willing to agree to Medicare cuts.

And the willingness to agree to entitlement reforms, if people get back what they've paid into the system, was consistent across all groups: 65 percent of Tea Party supporters and Republicans were open to cuts, along with 61 percent of independents and 60 percent of Democrats.

…support for Social Security and Medicare is largely driven by the "contributive" element. Americans simply want to recoup the money they contribute to the system. They just want their money back. If policymakers can communicate that entitlement reform will not rip off contributions, they may be able to garner enough public support for meaningful reforms.

We see the same concept at work when Americans are asked about letting people opt out of paying for Social Security and Medicare. The Reason-Rupe poll found 54 percent of Americans favor allowing workers to opt out of Social Security if they choose to rely on their own retirement savings. And 56 percent would let workers opt out of Medicare if they want to pay for their own health care in retirement.

Americans aren't unreasonable. After seeing money leave their paychecks and pour into Social Security and Medicare, they don't want benefit cuts to those programs because they think they've explicitly paid for those benefits. But tell them they'll get all of their money back or that they can opt out and pay for it themselves, and they are open to fixing the third rail of politics. If politicians can muster the courage to take on entitlements, they'll find taxpayers are ready and waiting for them.

The full column is here and the Reason-Rupe Poll is here.

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27 responses to “Reason Writers Around Town—The Key to Entitlement Reform

  1. As a commenter in the original column noted, people on SS and Medicare get back all they paid in after just a few years. This will never fly.

    1. Yep. Those poll numbers would look a lot different if they included the person’s estimated contribution.

    2. Really? My 45 years worth of contributions would be worth about three times what I can expect to collect from social security if the funds had been invested in a stock index fund. Maybe you are correct if you count those with low income who get back proportionally more, those on disability, those who never worked but get widow’s pensions, etc.

      1. This is exactly what would happen. The recipients of the largest wealth transfer in the history of mankind don’t just want the money they paid, they actually want interest on money that was not only not invested but spent ON THEM the second they were taxed.

        I wonder what happened to all those excess payments that did not go to retires at the time? Oh, it went into the general fund. I wonder what happened with that money. No I don’t.

        1. Speaking only for myself, I’d be willing to forego any interest under the rationale…

          Taxation is theft.

          SS contributions represent money stolen from me.

          The thief has assets(land, buildings, really cool jet fighters).

          Seek restitution via assets.

          This would have the added value of forcing Leviathan to liquidate. And that’s why it’s not happening.

          1. Whoops! I read down later. James Merritt beat be to this.

      2. No kidding. But the important part is the 45 years. Even at 4% interest — low-earners get as much as an 8% “return”) — it would take a 60%+ cut to Social Security benefits to “get back” (steal) what they “put in” (had Congress blow on more entitlements and foreign wars). Even at 1% — and SS does far more than that — you’d need 20% cuts.

        Any talk of cutting Social Security usually means “investors” still get far more than “their” money back, yet they oppose those cuts.

        If you said something like, “Would you offer to forego all the interest your accounts will earn over 45 years for the guarantee that you will just receive your principal back?”, you’d have no takers. The sad fact is that almost no one understands a damn thing about how SS works, and there won’t be any reform because defenders can wail endlessly about forcing gramps and granny to die in the street and/or eat dog food, and it’s hard to find enough people to see through the BS.

  2. I’ve been suggesting a buy out plan for years.

    * If you’ve started getting benefits from the program, you get your contribution back minus what you’ve used or 50% of your contribution, whichever is greater.

    * If you’ve never taken anything out, you get your contribution back.

    * If you’ve never contributed, you never will.

    In both cases you contribution will be calculated as having accumulated 4% annual compound interest.

    Pay it all out at once and turn out the lights.

    1. There is no $ there. It was “borrowed” by Congress to pay for other neat shit. Of course, we could just print money and pay all this back. It’s a house of cards I tells ya.

      1. Yeah. I know it’s all I.O.U.s but I think doing this now would cost less than the projected cost of the current system over the next 10 years.

  3. The 99th percentile of Americans, by income, starts with households earning incomes of $593,000. The “We Are the 99 percent” branding puts somebody making $500,000 per year on the oppressed-and-downtrodden side of the wage divide. Indeed, “99 percent” is so expansive a designation that it includes most of the bankers working on Wall Street.

  4. Can we get a janitor to the South Korea thread? Somebody left a big mess in there.

  5. Outside of principled quasi-anarchist circles, opposition to entitlements is almost always about others getting an unfair handout. People have a hard time understanding that they’re not paying into a personal retirement or health insurance account, they’re paying to maintain a universal safety net. Just as we don’t pay road taxes to fund the roads only we drive on, etc.

    It is my hope that some day people stop obsessing over the possibility that someone might get government assistance and have brown skin, er I mean not deserve it, and think about just where that money would go if it weren’t funding a safety net program. After all, we’re not talking about principled quasi-anarchists who are the loudest voices for ending the welfare state, it’s people who can’t tolerate a 10:1 ratio of spending cuts to tax hikes to deal with a deficit problem. It’s just a large pool of the national wealth that hasn’t been looted for the ‘productive’ yet.

    1. The wealth wouldn’t be there unless the productive made it dipshit. You are the one looting.

      Sometimes your stupidity crosses the line from comically pathetic to downright despicable.

      1. This mythological image of the Galtian superman would be frightening if it weren’t so pathetic and servile.

        The people who make things, teach people, protect life, fix things… you know DO WORK, aren’t part of the equation. They’re just pitiable serfs on the planet that billionaires created.

        1. Tony your heinous and egregious assault on strawmen has to stop at one point. Honestly, if strawmen are Jews, you’re Hitler.

    2. Now I see. People don’t understand that they are paying into a failure. And so we should keep quiet about it until it is a complete fail, so that we can continue electing Tonys, who created the fail. Son, you got a panty on your head.

      1. It will only fail if politicians deliberately make it fail.

        Its failure, of course, taken as a foregone conclusion around here, even though you’d really really like to preserve the welfare state I’m sure. We just can’t, you see, because the lowest tax rates in the better part of a century just aren’t low enough to equal freedom yet.

        1. Tony, entitlements will live or die based on how much you believe. Don’t look at the numbers or you may lose your nerve. We only give you a hard time to test your faith. We are all counting on you because, God knows, there’s not enough revenue to pay for all this.

        2. Tony|10.11.11 @ 4:59PM|#
          “It will only fail if politicians deliberately make it fail.”

          Yeah, shithead. Running out of money won’t have any effect at all.

    3. Tony|10.11.11 @ 4:40PM|#
      “Outside of principled quasi-anarchist circles, opposition to entitlements is almost always about others getting an unfair handout.”

      Outside of strawmen and lies, shithead has nothing to post.

    4. People have a hard time understanding that they’re not paying into a personal retirement or health insurance account, they’re paying to maintain a universal safety net.

      A “universal” safety net? Because if Warren Buffet doesn’t get Medicare he probably will die from lack of medicine?

      Since you are an imbecile, here is a little hint for you. Rich people don’t need a saftey net. Means test the whole fucking thing and then get back to me. Science H. Logic you are a simpering little turd.

  6. I also have been talking about this aspect of the “3rd Rail” for years. People really are reasonable, and seem willing enough strike a fair deal with Uncle Sam. However, I think that recipients should TRULY get what they put in — i.e., adjusted for inflation since the time of contribution (which obviously requires a complex calculation, but would in reality be no more work than sending us those annual “account summaries”). Getting some interest back might be good, too, but at least refunding the true value of accumulated contributions would be the minimum acceptable settlement, imho.

    I have also long said that I (and probably many others) would be amenable to “in kind” settlement. For instance, give me free and clear title to a few acres, near the ocean and an access road, in Los Padres National Forest south of Big Sur (that is to say, somewhere in the region where I was born and which has been my home for decades), and I will agree not to ask for or expect the cash value of my “account” or any other “benefits” from Social Security. My point being, the US has vast assets, which it could readily barter in discharge of Social Security “obligations” to aging geezers like me, without having to borrow more money or raise the taxes of my fellow citizens and I. A fair deal is possible, though I think our leaders won’t even consider such things as I have suggested unless “encouraged” with pitchforks, lit torches, tar, and feathers. Call me cynical.

    1. I read a study once that suggested the Palestinians could be bought out too, and that whole mess put to bed. Somehow that never happened either.

      By the time we reached the tar and feathers stage, we’d be so far gone that it didn’t matter any more. The MSM “celebration” of “the Arab Spring” has astounded me from the start, for this very reason. What are the odds that any of those countries are going to be anything but hell holes for the next several hundred years?

      Your suggestion is intriguing. But a major thing that prevents it from happening, I strongly suspect, is the fact that our congress is democratically elected. If we disbanded the welfare state then the politicians wouldn’t matter so much anymore.

      Then there’s the fact that what you suggest runs in the face of altruism which, in spite of its claim to be “for” helping “the poor”, is most often used to tear down anybody that has a few dimes above what they claim “the average” to be.

      The American people have been spoon fed altruism by our educational system, from kindergarten through college graduation, for at least a century now. Though it kills them, they will not reject it.

      1. All of which inspires a really interesting headline in the future (probably in some alternate reality): US President Achieves Middle East Peace Through the Simple Expedient of Buying It.

        I’ll bet in the long run it’d be the cheaper solution. But it’ll never happen.

        Of course you realize it would have to be America that buys it. Just because that fits the liberal vision of the universe.

        But how much would that cost, versus how much we dump into Middle East foreign aid every year?

        1. Buy it from whom? From Far East Extortion, Inc.: “Nice little peace you got there, Sammy Boy. Sure would be a shame if it were to get broken somehow…”

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