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Socialized Security

By Mark R. Rushdoony
May 26, 2005

In case you had not heard, Social Security is in trouble. Of course, this is nothing new. I was taught this in high school and told not to expect anything from the system.

Social Security has never been discussed honestly at the federal level. Originally presented as an insurance, it has never been anything more than a tax on some people, redistributed to others. The funds received by the government for this welfare system have since been used for any number of government spending programs. Now the bean counters in Washington are worried about how they will pay the IOUs.

The demographics are all against Social Security. When the Baby Boomers start to retire in about 2008, the system will begin to tilt increasingly toward payouts of benefits. By 2018 the system will fall short. By 2031 there will be only two American workers to support every recipient, an untenable burden.

There have been a number of reforms to Social Security in the past twenty-five years. All have involved increased taxes and/or reduced benefits. President Bush has proposed partially “privatizing” the system. The objective is to allow taxpayers to build assets by investing their Social Security taxes in the stock market.

There is a major problem with the Bush plan, however. It is seeking a fundamental shift from a pay-as-you-go system to a save-until-you-retire system. It will take funds from the current system and redirect them to future retirements. Those lost funds will require more government borrowing, more taxes, or inflation, all of which mean that taxpayers pay. The Bush privatization plan provides a better system for younger workers, but does not fix the problem now faced by the system.

There is an even greater problem with the Bush plan. Its privatization, in reality, represents the socialization of the American economy and the manipulation of the stock market by government policy-makers.

Already, the Bush plan’s supporters are saying that individuals would not be allowed to risk their retirement funds on just any investment. The government would, in fact, have lists of “approved” investments. Private Social Security accounts would have to be invested in government-approved stocks and funds. This, of course, is consistent with the original rationale of Social Security: the government does not trust individuals to provide for themselves or make responsible decisions about their future.

Wall Street loves the idea of privatizing Social Security. Imagine the billions of dollars that will flood the stock market. Every company and mutual fund will need to be government-approved to stay attractive to investors. Will government approval necessitate “voluntary” participation in benefits to domestic partners or any other government demand? What company could refuse at the risk of losing such income? Politicians would run on promises to make approved companies and funds compliant with the latest form of political correctness. The flood of retirement account funds would be like weekly heroin shots in the arm of the stock market, and the federal overseers of this “privatized” system would be the dealers, threatening to cut off any corporate junkie who got out of line.

It is not the diversion of individual’s taxes to private investments that troubles me. I would like to see a drastic reduction in taxes and a shift to private investments. A government program of private investment accounts, when all is said and done, is more government program than it is private. All the government has to do to encourage personal investment and responsibility is reduce taxes and eliminate or phase out its spending programs.

Yes, we must get rid of Social Security. Reformed socialism is still socialism. Why cheer for a new form of socialism that compromises the free nature of the stock market? Why let the people who defend and run our current system have yet another means of control over our economy?

I believe the Republicans who say Social Security is in trouble. I also believe the Democrats who say Bush’s plan won’t fix the problem. I think they all know they’re dealing with a fraudulent scheme that has no easy fix. I am not too excited about this debate. As long as we cling to Social Security, we are clinging to a fraud. As my high school headmaster used to say, “Social Security isn’t very social or secure.” It is a program of taxation, and, even if reformed so it lasts a little bit longer, will never be more than a reformed tax.


Topics: Economics, Family & Marriage, Socialism, Statism, Government

Mark R. Rushdoony

Mark R. Rushdoony graduated from Los Angeles Baptist College (now The Master’s College) with a B.A. in history in 1975 and was ordained to the ministry in 1995.

He taught junior and senior high classes in history, Bible, civics and economics at a Christian school in Virginia for three years before joining the staff of Chalcedon in 1978. He was the Director of Chalcedon Christian School for 14 years while teaching full time. He also helped tutor all of his children through high school.

In 1998, he became the President of Chalcedon and Ross House Books, and, more recently another publishing arm, Storehouse Press. Chalcedon and its subsidiaries publish many titles plus CDs, mp3s, and an extensive online archive at www.chalcedon.edu.

He has written scores of articles for Chalcedon’s publications, both the Chalcedon Report and Faith for all of Life. He was a contributing author to The Great Christian Revolution (1991). He has spoken at numerous conferences and churches in the U.S. and abroad.

Mark Rushdoony lives in Vallecito, California, his home of 43 years with his wife of 45 years and his youngest son. He has three married children and nine grandchildren.

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