On March 29, 2011, Senator Sanders once again defended Social Security and explained how it hasn’t contributed to the deficit.
See my colleague Norman Kurland’s article entitled: “Saving The Social Security System” at http://
Social Security is a system built to collapse. The Capital Homestead Act (CHA), a new, comprehensive national ownership strategy proposed by the non-partisan Center for Economic and Social Justice, would save the system, directly addressing three of the system’s most serious structural flaws:
(1) Social Security is a pay-as-you-go system and has no productive assets to stand behind the government’s mounting promises. As such, it has been compared to a Ponzi or pyramid scheme.
(2) An unhealthy generational political split is inevitable between workers and Social Security recipients. Potential beneficiaries are growing larger in number. 75 million baby boomers will soon join their ranks. The working population who pay into the system (and whose payrolls are taxed from dollar one) is shrinking in proportion to the recipient population. In 1940, soon after the program was launched most Americans died before reaching the eligible Social Security age of 65, and the burden ratio was roughly 42 to 1. Now the burden ratio is about 3 to 1, putting more and more dependents on fewer and fewer backs.
(3) The rich are largely exempted from sharing in this mounting burden. Not only is there is a cap on salaries taxed for the so-called trust fund, but also there is no tax on incomes from dividends, interest, and capital gains to support social security. The present program is a good example of regressive taxation. A disproportionate burden falls on the poor, relieving high-income workers and the wealthiest Americans of the responsibility to meet the nation’s promises to poor and middle-class workers.
