Ron Paul: Why the Government Lies About Social Security

Why the Government Lies About Social Security

by Ron Paul

Perhaps the biggest media story of 2010 was the influence of Tea Party voters on the Congressional landscape. The new Congress comes to Capitol Hill with a mandate to end profligate spending and restore fiscal sanity in Washington, we are told. But when the House and Senate convene in January the newly elected members will face tremendous pressure to maintain spending levels for entitlement programs. Even the most modest proposals to trim Social Security or Medicare spending will be met with howls of indignation and threats of voter revolt. Legislators who propose any kind of means testing or increased retirement ages can expect angry visits from senior citizens and lobbyists ready to fund a candidate back home who supports the status quo.

But millions of Americans now realize that the status quo is an illusion that will not last even another 10 or 20 years. The federal government cannot continue to spend a trillion dollars more than it collects in revenue each year because we are running out of creditors. Fiscal reality is setting in and the consequences may be grim, even if Congress finds the courage to take decisive action now.

Courage begins with a commitment to see things as they are, rather than how we wish they were. When it comes to Social Security we must understand that the system does not represent an old age pension, an insurance program or even a forced savings program. It simply represents an enormous transfer of payment with younger workers paying taxes to benefit the other beneficiaries. There is no Social Security trust fund and you don’t have an account. Whether you win or lose the Social Security lottery is a function of when you happen to be born and how long you live to collect benefits. Of course young people today have every reason to believe they will never collect those benefits.

Notice that neither political party proposes letting people opt out of Social Security, which exposes the lie that your contributions are set aside and saved. After all, if your contributions are really set aside for your retirement, the money is there earning interest, right? If your money is in your account, what difference would it make if your neighbor chooses not to participate in the program?

The truth of course is that your contributions are not put aside. Social Security is a simple tax. Like all taxes, the money collected is spent immediately as general revenue to fund the federal government. But no administration will admit that Social Security is nothing more than an accounting ledger with no money. You will collect benefits only if future tax revenues remain high. The money you paid into the system is long gone.

My hope is that at least some members of the new Congress will cut through the distortions to see Social Security as it really is. The best way to fix the impending Social Security crisis is also the simplest: Allow younger individuals to opt out of the program and use their tax savings to invest privately as they see fit. This is the true private solution. Your money has never been safe in the government’s hands and it never will be.

  • troybr79

    screw the seniors, they’re the ones who have voted for these crooked politicians over the last 40 yeras that have raided the trust fund down to $0. They get what they voted for. I pay into it and will not get anything out of it and that is theft.

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  • CJLopez21

    all that stuff is paid for through various other taxes. guess how much of our federal income taxes goes to services we’d expect from govt? pretty much zero. property taxes have paid for our public schools. various taxes such as the gasoline tax when you fill up your car, the gasoline tax has paid for our highways.

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  • MrGdeo

    question: if we end the fed and abolish the IRS, how do we run the government, pay for bridges, pay police, firemen, etc???

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  • futbolfever90

    Please title your next talk ‘Why the Government Lies About Everything.’

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  • Elizruth

    So, I think the government should cut each of us a check for all of the money we’ve put in already and call it good. I’m going to be so pissed if we don’t get the money back that they put into social security. Heck, I’m just pissed at how they waste our money on these wars!

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  • RichterEX2

    Social Security is pretty much a Ponzi scheme now. :(

    I’ll probably never see a penny of it when I get old.

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  • LostFREEDOM

    The Government is a giant LIE, people are stupid SHEEP. ITS ALL A LIE !! WE ARE JUST U.S. SUCKERS

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  • 18wheeler76

    i didnt know this,thanks doc,for teaching me that my money isnt set aside for me,that it is spent immediatley,i learned alot from you.because your honest

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  • gotama420

    stop wasting our money killing people around the world do not take money from social security. ther is supposed to be a fund but the govt keeps stealing from it.

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  • Nothingizm

    Ron Paul 2012

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  • RandallSteen

    Merry Christmas, Dr. All the best to you and yours my friend. God Bless.

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  • bigken61

    “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” — Henry Ford

    Tick Tock… Tick Tock… Tick Tock…

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  • WunderMaus

    If people had invested their social security in private investments the recent financial crisis would have wiped that saving out of existence. Social Security has provided a safety net to millions of Americans, Young and Old for decades. We pay into SS like an insurance policy so that when we get old & are no longer able to work, we can draw on that policy. Some people pay into SS die & never collect a dime, whereas children of those deceased get SS benefits. SS is not perfect but it does work.

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  • Klaffveinz

    People work to earn money, this money is then taken away in the form of tax and spent to make other people work. Money is simply a medium of control. The materialism portrayed in the media through music videos and advertisements perpetuate our worship of money and thus makes us more prone to control. Money should not be manipulated. To sell money and buy money (interest) is creating units of work without actual work being done.

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  • linkfan22

    reddit. that is all =).

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  • campaign4liberty

    Ron Paul Hope for America!
    learn more visit Liberty Poet
    website

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  • donatefreedom

    Ron Paul 2012!
    visit Liberty Poet
    website

    Love Liberty Peace!

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  • kingcherub

    I’m not sure how original this thought is but, I’ve come to the conclusion the media elites who started the insane paranoia against the tea-parties was not so much to criticize tea-partiers as it was to stop Ron Paul without openly attacking Ron Paul…In other words: how could they with credibility attack one of the most well respected statesmen in Washington and remain credible? Instead attack the group that would lead him to have greater influence. Very clever…except that it didn’t work.

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  • How2Draw

    Thanks Ron. You ROCK!

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  • XpresloX

    Actual gorvernment, its a liar gorvernment. Free wikileakd !

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