Tuesday, September 18, 2012

Social Security

September 17, 2012


Social Security


The Social Security system has changed a lot since its inception in 1935. It was originally intended to give people at 65, the age of retirement, some money to help with retirement expenses. No longer would old people be forced either to work far beyond 65 or forced into destitution. However, in the 77 years the program has changed to a catch-all social welfare system which now sends money to survivors, i.e. widows and minor children, and pays those who have suffered some permanent injury or disability that prevents them from working. The eligibility and size of the disability benefit is determined by the amount of Social Security benefits the worker has accrued. Social Security also includes Supplemental Security Income (SSI) for non-workers and children who have a permanent disability, i.e. blindness, mental problems, paralysis. SSI is means-tested, thus someone with a major disability and low income might receive the maximum benefit for the rest of their lives.

All this is funded by a tax on workers and employers based on the total wages of the worker. It is about 4%, which is shared paid equally by the worker and the employer.

Thus, this system supports a very large social welfare program, from which all society benefits, that is, our society does not have the lame, the halt and the blind begging on street corners, as was the case in the late nineteenth century. For a look at the ravages of sickness, accident, and unemployment wrought on nineteenth century socity, take a look at Wisconsin Death Trip, a compilation of newspaper clippings from Wisconsin newspapers from 1880 to 1900. It is stark and riveting.

However, the amount beyond which an individual does not have to pay FICA has been fixed at $110,100 (2012). Thus the very wealthy do not pay for the programs mentioned above; this burden is left on those below that income level. It's a very nice perk for the wealthy. They have the benefit of a functioning society that takes care of the sick and the disabled without paying for it.

Shouldn't we abolish this income requirement and tax the wealth above $110,100 to keep these program solvent?

Lastly, by a Supreme Court decision of 1879 corporations are deemed to be deathless legal persons who thus are completely protected by the Bill of Rights and all other laws pertaining to individual responsibility. They can be sued, pay fines, and sue others as any other individual. Therefore, shouldn't they have to pay Social Security taxes like anyone else?

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