Who pays for government programs?

I had a talk with my mother-in-law over the weekend about privatizing
Social Security. She made some great points about keeping the subsidy
just like it is, and I’ll go through them now:

• Immediately changing the system would strand millions of
  people who don’t have any means of income except Social Security. As is
  usual for government largesse, Social Security recipients — who have
  paid millions in taxes for this subsidy over the decades they worked —
  get a pittance in return from the government every month. Worse, the
  government applies rules and regulations limiting the amount of money
  retirees on Social Security can earn on their own, further reducing
  their ability to provide for themselves after they retire and start
  taking the government check.

• Most people today have no idea how to save for their own
  retirement. People the age of my in-laws knew what poverty and hard
  times were; they lived through the Depression, and their parents taught
  them the good old-fashioned value of self-reliance and self-sufficiency.
  They know what it means to save and to do without so you can put
  money aside for your own retirement. Pulling the rug out from under
  Social Security tomorrow would leave these millions of people without
  any means; They have no real savings, and would have no government
  check, however small, to look forward to.

We did, however, agree that a privatized version of Social
Security — perhaps like the Chilean model — could be phased in
over the years, allowing those dependent upon it to use it while new
workers entering the workforce are given notice: You will have to
provide for your own retirement.

Why the discussion on this, the “third rail” of American politics?
Taxes — it all came down to this.

We had been talking about the wasteful spending in our own home state
of Missouri, where liberal Democratic governor Mel Carnahan — eyeing a
run for the U.S. Senate against incumbent Republican John Ashcroft — is
leaving a legacy of expanding the state’s budget some 300 percent since
entering office nearly eight years ago. When Carnahan first took
office, our state’s budget was somewhere in the vicinity of $6 billion;
now it is nearly $20 billion annually — with a surplus, mind you — and
still state planners cannot seem to spend it fast enough.

We were verbally perusing all the favorite tax-sucking programs:
State employment, public schools, roads and bridges, and welfare
assistance. Then I mentioned that a similar line of reasoning could be
applied to Social Security — a scam by any measure.

Mom-in-law disagreed, for the reasons I listed above. And she was
right; this country is in no shape fiscally to provide for its own
retirement, because since the 1930s Americans — thanks to Mr. Roosevelt
— have had that quandary removed from their consciousness.

But when we started talking about the ever-increasing tax burden in
our own state and began applying that to the national level, where
Washington politicians behave exactly the same way when it comes to
spending our money — the logic became clear.

Uncle Sam simply gets — and spends — too damned much of our
money.

My points on the Social Security aspect were simple:

• What right does the government have to collect millions of
  your dollars, then dole out a pittance to you until you die — an amount
  that in no way equals what you’ve paid over the years?

• What right does the government have to force you to earn only so
  much a year (without penalizing you in higher taxes or lower SS
  benefits) just because you’re finally accessing the money you
  paid all those years?

• The government is not in the financial planning business;
  it is not the duty of a bunch of greedy pinheads in Washington, D.C., to
  plan for our retirement. It is our job; and it is
  our right to plan it any way we choose.

• If we cannot plan adequately, that’s tough — it’s our
  problem, not the problem of the federal government or the problem of
  those who did plan accordingly.

On the last point — planning — before we ever consider
changing the Social Security structure, we must also consider how we’re
going to teach young people in school, at home, and just entering the
work force how to plan for their own retirement. It’s like
welfare — as much as many of us want to see it go away completely, we
cannot simply take it away in one fell swoop. It would require a
generation, at least, of incrementally phasing it out while giving
people the opportunity to learn — and then get — a job in a trade that
can support them.

In a roundabout way, my basic point is, the more government we get,
the more it costs us to get it. The federal government has no money
of its own; every dime lawmakers and bureaucrats spend comes from
the fruits of our labor. So when President Clinton or the
first lady
or some “compassionate” lawmaker proposes — then passes — a new
government program, guess who gets to pay for it?

We do. Every single time. No exceptions.

Consequently, unless and until we force our leaders to abandon the
government’s cradle-to-grave socialistic tendencies to “take care of us”
throughout our lives, our tax burdens will never decrease; they will
only increase.

Such is the case with boondoggles like Social Security. While we may
not be ready as a nation to abandon it tomorrow, we sure as the world
cannot continue to believe we can afford it for another 50 years. The
numbers just don’t add up; too many people will try to collect and too
few people will be working to sustain it. Taxes will have to be
raised to support it — and if that is our “retirement business model,”
then forget about a serious reduction of taxes (and the size of
government in general) anytime in our lifetimes.

Besides, the government shouldn’t be paying for our retirement in the
first place. That’s our job and, as it happens, Americans who are
allowed to provide for their own futures have a much better track record
than the government for doing so.