What’s happening to Social Security?

| 3:00 pm EDT June 29, 2023
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It’s what Republicans don’t want you to know. One of the reasons that Republicans inveigh so much against Social Security (what they disparagingly refer to as “entitlements”) is because they know that a day of reckoning is coming. By 2033, Social Security as it exists now will no longer be able to fully fund new baby boomer retirees. If things remain as they are, by 2033 Social Security will only be able to pay 77% of total benefits to the newly retired. In the game of musical retirement chairs, somebody is going to find themselves without a seat.

How did this happen? It wasn’t supposed to. In fact, way back in 1983 the problem was foreseen, which is why the age in which a retiree could start collecting full benefits has been gradually increased from age 65 to age 67. That change was supposed to help finance baby boomer retirement.

But what wasn’t anticipated was how much income inequality would affect the total being paid into the fund. Social Security has a cap, and in 2023 that cap is $160,200 a year. Back in 1983 that was a breathtaking amount of money for any man or woman to earn in a single year. These days it’s peanuts to the super rich, and more and more of the super rich are reaping the benefits on that account.

So as the rich become richer, more and more of the nation’s total income has escaped Social Security tax, which means it will not be able to fully fund the increasing number of baby boomer retirees. This is a problem that’s easy to fix if rich people start paying their fair share.

And therein lies the problem. Rich people don’t want to pay their fair share. In fact, rich people don’t want to pay any taxes at all. They want the rest of us to pay taxes so they can continue to enjoy even more benefits, as if being super rich wasn’t already groovy enough.

This is why most rich people are Republicans and why Republicans in Congress hate Social Security. The last thing Republicans in Congress want to do is deliver the bad news to their rich benefactors that they’re going to have to start paying their fair share. That’s why they use loaded words like “socialism” and “communism,” to frighten the stupid poor Republicans who support them into supporting them even more. You have to be pretty stupid to be poor and a Republican but, well, we’ve all seen pictures of poor dumb Republicans and let’s just say there are few surprises and leave it at that.

The problem in summary is that right now a rich CEO earning $10 million a year pays social security tax on only roughly 2% of their income, while normal people making ordinary incomes at or less than the cap pay Social Security tax on 100% of their income. As the income gap widens, the inequality of burden gets more and more unfair, and the poor who will need Social Security benefits the most are going to pay the full price in cost and disappointment. What a surprise.

If it were up to Republicans they would raid the whole Social Security fund and dole it out to their rich friends and give the rest of us doodly squat. Never forget that Republicans hate poor people, and they never get tired of demonstrating just how much they hate poor people.

Can something be done about it? Damned right something can be done about it. The cap can be eliminated or at least raised. Blood-curdling profits paid to greedy defence contractors working for the armed forces can be funnelled instead into social programs. The problem is quite easy to fix, but it’s going to be hard to implement as long as the Friends of the Rich — Republicans — have anything to say about it. And, as ever, ladies and gentlemen, brothers and sisters, comrades and friends, stay safe.

Dear Palmer Report readers, we all understand the difficult era we're heading into. Major media outlets are caving to Trump already. Even the internet itself and publishing platforms may be at risk. But Palmer Report is nonetheless going to lead the fight. We're funding our 2025 operating expenses now, so we can keep publishing no matter what happens. I'm asking you to contribute if you can, because the stakes are just so high. You can donate here.