John

They want it both ways.

The progressive liberals who want to pass heath care want to hold up Social Security, Medicare, and Medicaid as examples of successful government run programs [1]. They say that Social Security has never missed a payment yet [2] (but ignore the fact that it’s trust-fund does not actually exist, the program is soon-to-be insolvent [3], and payments will have to be made from the general fund by 2016).

Social Security, as a retirement system and method to keep people out of poverty, is a failure. The system is a ponzi scheme with new entrants into the system compelled by the threat of force to pay for the benefits of the people who are leaving the system. The extra money that was paid in over the last few generations? Spent on wars, irresponsible social policies, and bridges to nowhere. Read this defense of Social Security [4]. Business Week author Michael Mandel argues that SS isn’t a ponzi scheme because our technology and ability to grow our GDP will always improve enough to cover all future costs.

Sounds like this guy wasn’t paying attention to the last two asset bubbles the Federal Reserve inflated to boost that “always increasing” economy.

What Social Security has done, it has done well. It has destroyed the family unit by destroying the need for it. No longer do husband and wife need to remain together for financial support, they can get a divorce just because their current situation is no longer convenient. No longer do the children feel any need to support their parents, that’s now become the government’s job. And the government has done an excellent job of teaching them this new way of thinking. With the family destroyed and mocked as an archaic institution the government has virtually guaranteed that those people, who historically would support their parents in their old age and in turn be supported by their children when they became old, would now become dependent upon the largess of the government.

It used to be considered shameful to accept charity from your neighbors or welfare from the state. Now it has become a bragging right. The state has gone out of its way to make sure the dependent class it has created feels no shame attached to that dependency. By teaching these people that it is their right to receive these benefits by virtue of having “paid” for them, they removed that stigma. If you are on Social Security or receive Medicare or Medicaid benefits, you did not pay for them. You paid (if at all) for someone else’s benefits. Your benefits are being paid by the generation now working.

The state cannot make money for these programs, it can only move money from one person to another, taking a little bit out on the way for the trouble. As the capital is transferred from productive to non-productive uses the ability of the country as a whole to succeed and prosper is lessened.

[1] http://www.examiner.com/x-4380-Healthcare-Reform-Examiner~y2009m8d7-Republicans-admit-Medicare-is-good-governmentrun-healthcare

[2] http://www.scfl.org/?ulnid=1562

[3] http://www.washingtonpost.com/wp-dyn/content/article/2009/05/12/AR2009051200252.html

[4] http://www.businessweek.com/the_thread/economicsunbound/archives/2008/12/is_social_secur.html