Social Security Changes/Values/Fixes

[rcc1 <rcc1@flash.net>]

     Thanks for the opportunity to speak out on Social Security.

     Congress and the Administration have no reason to make any
meaningful changes to Social Security which cut into the "free money"
currently available from excess taxes, and which will continue to be
excessive to Social Security needs for several more years.

     They have truly taken unfair advantage of Social Security taxpayers
to hide their free spending ways.  They took the money from those
taxpayers and levied a huge debt burden (called the Trust Fund) on our
children and grandchildren as part of a shell game perpetrated on
citizens.

     A Trust Fund analogy would be a financial institution which takes
one's money as an investment in bonds at a given interest rate.  When
redemption time comes the institution sends a letter stating the bonds
will be redeemed when the individual pays an amount of money equal to
the original investment plus interest earned because the institution
spent every penny of their investment.  How many investors would
willingly send their money to any institution under those
circumstances?  That, in a nutshell, is the Social Security Trust Fund!

     There will be no Social Security surplus, and hence, no true Social
Security Trust Fund until something is done to keep the greedy hands of
politicians off the money as it is collected.

     Better yet, if Congress really wanted to do something about Social
Security they would come clean with taxpayers and admit the Trust Fund
is broke, has always been broke, will always be broke, and consists
entirely of debt instruments future generations will have to pay.  They
would unambiguously state that excess taxes supposedly collected for
future use were spent to hide the true cost of running government
programs.

     With that honesty as a basis for national discussion,  politicians
could stop  pussyfooting around the true issue -  how to finance the
actual cost of Social Security programs into the future.  Maybe with the
truth out in the open politicians will discard the travesty we
laughingly call a Trust Fund, and the tremendous debt burden it
represents to our children's future.

     Who knows, they might even figure out citizens of all ages can deal
with the truth of the situation and be willing to listen to
straightforward proposals.  The problem is nobody trusts politicians to
do anything in the best interest of the citizens of this country, only
what is in the best interest of themselves and their benefactors.  I
dare say there are no politicians in either the House or Senate who
would face the flak such honesty would bring so meaningful changes to
Social Security are simply not gong to happen.

     Politicians will do what politicians always seem to do, band-aid
this job to keep theirs, and pass the problem on to future generations.

     In my opinion, any organization which can declare over $650 billion
in national debt to be a surplus to those who must pay that debt cannot
be trusted to do anything completely honest and above board for the
citizens of this country regarding Social Security.

     It's a sad commentary on the state of our political institutions
when its members shamelessly demagogue such a tragedy as the Social
Security debt burden for their own personal aims.

     I would change the Social Security finance system as follows:

     1.  Wipe out the Trust Fund debt by declaring it null and void to
the individual taxpayer.

     2.  Institute annual tax increases sufficient to fund the system
beginning the year current tax rates no longer pay 100% of the cost.
That tax rate would be insufficient to generate excess money for
politicians to spend (euphemistically called investing) to run other
government programs.  The rate would be increased each year sufficient
to match program requirements and no more.  The true cost of the
programs would be highly visible in real time dollars and any money not
spent would be fenced and retained in cash in escrow pending next year's
cost determination.  This determination would be made automatically and
the tax rate could not be raised or lowered by Congress beyond realistic
projections.   There would be no need to do so since the money could not
be touched or "invested" in government debt instruments.  Even if
projections were done on a five year plan no moneys would be available
to any other agency of government, and overages unspent would be used to
lower tax rates.

     3.  I would establish a Social Security Individual Retirement
Account with a minimum percentage participation rate and collected at
the same time as regular Social Security taxes.  The SSIRA could be
supplemented by some additional percentage with that deduction amount
frozen for a period of not less than one year.  Changes could be made
during an individual's birth month and at no other time.  The mandatory
and additional contributions would not be matched by other tax money and
would be invested the same manner as the current civil service Thrift
Savings Plan with the exception that no money could be invested in any
federal government debt instrument.

     4.  Congress, by law,  would never again be allowed use Social
Security taxes to fund other government programs of any kind.

     5.  I would establish a Social Security means test which excludes
monthly income earned from  SSIRA proceeds.  The test would reduce
Social Security payments by some ratio above a floor such that the
reduction could not fall below a minimum benefit.  The test would
include all income earned outside tax deferred accounts.  Money retained
from this means test would be used in computing annual adjustments to
Social Security tax rates and not made available for government
borrowing.  The means test would begin two years before current taxes no
longer support the Social Security programs at 100%.

     As one can tell, I distrust current and future congresses and
administrations to deal honestly with citizens of this country as
regards Social Security and want their hands tied as tightly as possible
to keep them from continuing to raid the Social Security cookie jar.

     Thanks again for allowing a forum to express my views on Social
Security.

Robert C. Carroll
rcc1@flash.net