The Dialog Has Started

You know, I’m 37 and I’ve generally never gotten involved in politics except for the normal office “water-hole” discussions. This morning Neil Bortz had a piece (read about it in his Neil’s Nuze, December 7th edition) on the AARP’s fight against Social Security privatization. In case you don’t know Neil is a radio talk show host that is syndicated nationally. I sent an email to a reporter that Neal quoted to start a conversation about the issue and asked the reporter what he thought of Neil’s comment. I don’t know where the discussion is going to go from here, but I took the step and did something. I don’t know why I did this and have spent so much time today on this subject. I guess I’m just fed up! Read the below RANT and let me know what you think.

I copied the email I sent and pasted it below as reference material for your reading pleasure as well.

So after work today I started talking to a co-worker and we did a dirty calculation using a Bloomberg.Com retirement calculator and the Social Security Administration’s calculator and sure enough WE ARE GETTING SCREWED A BAD DEAL with social security. The government is roughly taking about fifteen (15) percent (7.65 percent x 2 as you pay half and then your employer pays the other half) of your total pay and putting it into a “TRUST FUND” that really isn’t a trust fund because the money is not really there. There’s no bank account where you can see your money, there’s no report where you can see your money invested and making money like you can with your 401K report. You simply have an I OWE YOU from your government.

So, if you are still with me here, here is why you should be PISSED OFF and wanting to do something about this mess. Assume that you could save the fifteen percent of your wages instead of “giving” it to the government so they can later “give” it back to you. Assume you make about $ 50,000.00 bucks a year. Fifteen percent of 50K is $ 7,500.00 dollars per year. Let’s keep these calculations simple and not adjust for inflation or raises, since in my case, for example, my raises have been pretty small and simply negate inflation.

  • Assume for fun that your $ 7,500.00 dollars is invested in a conservative mutual fund that makes say six percent a year. Using the Bloomberg.Com calculator at the end of 30 years you would have a good $ 592,936.00 dollars saved for retirement – not bad if I might say.
  • Using the Social Security calculator if you retired in 30 years from today with the same income level you’d expect a $ 1,623.00 dollar monthly benefit in today’s dollars. If you are a male and live the average life of 75 then you’d draw out of the system about $ 155,808.00 dollars.

Now you look at those two numbers and you can see why I think “Houston, we have a problem!“ And here’s some more ammo for me being a little pissed:

  1. If you die early, YOUR money is gone into the system and you will not be able to pass it to anyone.
  2. The more money you make the worse the comparison gets.
  3. This is your money and since our government is in so much DEBT (7.5 trillion dollars as of this minute) there is really no doubt that the system will implode unless we make changes. And do you really TRUST the government to be a good steward of YOUR money?
  4. You most likely could have much better returns with your money than six percent. A ten percent return on your money would garnish you $1,233,705.00 dollars after 30 years.
  5. The Social Security System works mostly by current workers paying into the system to pay out benefits to today’s retirees. Our population is generally getting older and over the next 10-20 years there will simply not be enough workers to pay for the benefits of the retirees.
  6. The elected politicians have no real plan for fixing this problem. In fact, although most politicians say there is a problem, they are unwilling to do anything serious about it because Social Security is a POLITICAL ISSUE that drives people, especially older people, to vote. In other words it is a political issue because the politicians want it to be one and because they know people are afraid of the future. A promise today from “OUR“ government for retirement security in the future is more comforting today to most people than the hard, cold, reality. Wow, that was a mouth full!

I think that the sad truth is that the numbers don’t add up and unfortunately we, the younger generation, are only going to receive a voided promise in the future. I don’t have a lot of faith in our Politicians who spend more money than is raised in taxes year after year and whose sole political survival depends on spending money and making people feel good TODAY instead of working for a better tomorrow.

I do have faith in our country. BUT, we have some real tough problems to solve.

What do you think is the solution here?

Email sent to Jim Drinkard:
———- Forwarded message ———-
From: Herschel Horton <>
Date: Tue, 7 Dec 2004 20:04:01 -0500
Subject: What do you think about this response to your December 6th piece…

I came by an interesting rant from Neil Bortz, (,
today in reference to the Social Security privatization issue. His
comments quoted your article in which he stated:

“Americans even believe that there’s actually a Social Security trust
fund.  Yesterday’s USA Today story about the AARP’s opposition to
privatization contained this line:  “Excess payroll taxes are held in
a trust fund for future benefit payments.”  That’s just flat-out
wrong.  USA Today reporter Jim Drinkard either knows it’s wrong, and
lied intentionally, or he’s not bright enough to be writing for a
national newspaper.  There is no Social Security money being held
anywhere.  It’s all spent.  Every single penny.  What the politicians
don’t have to spend on current Social Security benefits they seize and
spend on their various spend-and-elect schemes. ”

So what do you think? Are you wrong and intentionally lied in your
article or are you just not bright enough to be writing for USA Today?
Or is Bortz simply using your article to exaggerate his position?

You know, usually I don’t spend much time on issues such as this, but
I’m getting older and paying money into a “program” that really
doesn’t seem to be working. So I’ve decided to get involved and this
is my first attempt – trying to figure out what is going on and how I
can make a difference.

I know you must be busy, but please can you take a few minutes and
give me your thoughts?

Herschel Horton
Definitions (from
Trust Fund: property (as money or securities) settled or held in trust
Trust: 1 a : assured reliance on the character, ability, strength, or truth of someone or something b : one in which confidence is placed; 2 a : dependence on something future or contingent : HOPE b : reliance on future payment for property (as merchandise) delivered : CREDIT


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