QUORA: 'How do fans of Ayn Rand's work feel about the fact that she used social security?'

QUORA *: ‘How do fans of Ayn Rand's work feel about the fact that she used social security and Medicare in her old age?’

I posted this answer:

The question implies that those programs are voluntary. They are not.

Like everyone else (me included), Rand “used” Social Security and Medicare** because she was forced into it, by law--which means, at governmental gunpoint. As with any tax, if you evade your Social Security and Medicare taxes, you’ll be arrested, fined, and probably thrown in a cage. The fact that we Americans are forced into these programs by our own government, the very government that we should be able to count on to protect our rights to act on our own judgement and protect our property from thieves, is precisely what makes Social Security and Medicare immoral and in need of being phased out and abolished, as a matter of justice.

Justice also demands that a person should get what she pays for, even if the payment is forced. So regardless of what a person’s opinion is of Social Security and Medicare, anyone who pays FICA taxes is morally and rightfully as well as legally entitled to collect the promised benefits as long as these programs exist.

It is fully consistent, morally and logically, to “use” Social Security and Medicare while simultaneously expressing opposition. Both positions are based on justice. This view is also consistent with Ayn Rand’s work, given that justice is considered in her philosophy of Objectivism to be a cardinal virtue.

* [Quora is a social media website founded by two former Facebook employees. According to Wikipedia:

Quora is a question-and-answer website where questions are created, answered, edited and organized by its community of users. The company was founded in June 2009, and the website was made available to the public on June 21, 2010.[3]Quora aggregates questions and answers to topics. Users can collaborate by editing questions and suggesting edits to other users' answers.[4]

You can also reply to other users’ answers.]

** [I’m assuming for argument's sake that Rand actually did apply for and collect Social Security and Medicare benefits. If she did not, she should have.]

SUPPLEMENTAL:

Note to those who accuse Rand and others who conscientiously object to these programs while collecting the promised benefits of being hypocritical: To claim the right to force people into submission to your values, and then denounce them for objecting, is vicious and unjust, not to mention comical. But, hey, smears and insults and intimidation are always the last resort of those who can’t rationally refute the substance of the arguments against.

Related Reading:

The Social Security Injustice

Social Security and the "Hypocrisy" Charge

Single-Payer Healthcare: ‘Wouldn’t it be Nice’

Here are excerpts from a letter advocating single-payer healthcare for America that appeared in the New jersey Star-Ledger last February. It is titled Single-payer health care would be a big improvement:

  Wouldn’t it be nice if losing your job had no impact on your health insurance? Wouldn’t it be nice if all doctors participated in your insurance?

  Regarding cost, let’s consider that we already pay for everyone’s health care. A business that pays for health insurance for its employees passes that cost to its customers. We pay as a consumer, or we pay as a taxpayer.

  If we take the for-profit middle man out of our system, we immediately cut costs by almost 20 percent. If we get a system like those in a number of other countries, hospitals and doctors don’t need much in the way of billing departments that now have to deal with many insurance companies.

  We spend more on health care than countries that have single-payer systems. We don’t cover everyone; they do. I hope others will join me in explaining the benefits of single-payer. Convincing people voting for members of Congress is important.

  John S. Smith

  Hamilton

“Wouldn’t it be nice if losing your job had no impact on your health insurance?” You mean like auto, life, and homeowners insurance? That’s the way it would be if the government hadn’t interfered in the health insurance market. The third-party-payer, or employer-based, health insurance system is a government-created setup. If we got rid of the government policies that favor employer over individual health insurance purchases, as well as regulations mandating only government-approved insurance plans, people would buy their own health insurance directly from insurers competing directly in the consumer market.

The profit motive is not the culprit in the cost of health care. The government is the problem. In America today, almost 90% of healthcare is paid by third parties, not the consumer. This disconnect between consumer and provider eliminates the necessity for providers to keep costs down and consumers to shop price. The profit motive is actually a huge cost reducer when it is allowed to operate in a market free or relatively free of government interference. The need to turn a profit combined with competition for the consumers’ business creates natural incentives to raise quality and reduce prices, leading to continual improvements on both counts over time. You see this process going on throughout the economy, wherever real competition operates. It is the lack of real profit incentives—i.e., consumer involvement in paying—that leads to runaway costs in healthcare. That’s why governments that pay the bill always must control who gets what healthcare, when, and at what price.

Your own doctor? That’s a laugh. Under single-payer, the doctor works for the government, not the patient. The people who most love single-payer are the people who are overall healthy. Better not to get really sick under government-paid healthcare.

Healthcare providers “don’t need much in the way of billing departments?” Another laugh. The narrative of Medicare’s lower administrative costs is a myth. With only the government as the single payer, where’s the incentive to cut administrative costs when providers have no alternatives? In a private, free market environment, healthcare providers can refuse to accept insurers with unduly burdensome administrative costs. Once again, the profit motive in a competitive free market is a natural cost reducer.

In a free market, which is what we should have, everyone is responsible for his own health insurance and health care. It’s true that employers who cover their employees reflect the cost in their pricing, as they do all costs. So, in a very loose sense, you might say we pay indirectly for that business’s employee health care. But, there is a crucial fundamental differences between single-payer health care and employer health care—We are not forced to buy the product. We are forced to pay for single payer. When we buy the product, we are still free to make our own healthcare decisions, as the business and its employees are left free to make theirs. These are not just practical differences but deep moral ones as well, because the difference between private transactions and government programs is voluntary agreement versus force. Statists like Smith are unable or unwilling to acknowledge the difference between voluntary association and living by the sword.

It’s easy to say “wouldn’t it be nice” to have this or that out of context and without having to take personal responsibility. But then some people would say, “Wouldn’t it be nice if I could rob people on the street at gunpoint to pay for my stuff without fear of punishment?” That’s exactly what Smith is saying when he flippantly asks, “Wouldn’t it be nice if we had single-payer healthcare,” which is the same as saying “wouldn't it be nice if I could run to whatever doctor I want for whatever healthcare I want, and stick others with the bill?” Or, “Wouldn’t it be nice if all doctors were forced into servitude to government dictates, rather than retain the inalienable right to choose which insurance to accept or not accept?” That’s exactly what Smith is advocating when he says “Wouldn’t it be nice if all doctors participated in your insurance?”

Wouldn’t it be nice if we could force my ideal onto everyone else, with the government as the hired gun? Wouldn’t it be nice if we regard only my choices and disregard those who disagree? Wouldn’t it be nice if we didn’t have to take moral responsibility for our own lives? Wouldn’t it be nice if I didn’t have to be moral at all? Welcome to the moral jungle, where everyone is responsible for everyone else’s healthcare, but not his own—and everyone is legally chained to the system.

To which I ask, wouldn’t it be nice if we all respected everyone else’s right to control their own healthcare decisions, and had a government that reflected that? Smith’s collectivist “we” signifies Smith’s stone-cold cruel disregard of other individuals’ lives and liberty. Wouldn’t it be nice if we once again had true constitutional protection from heartless predators like John S. Smith and his ilk?

Related Reading:

Get Ready for the Coming Post-ObamaCare Battle

The Left's False Alternative on Health Care

American Healthcare's Great and Powerful Oz

Redefining Poverty to Reignite Big Government Expansion

“ALICE” is the new definition of poverty. So writes John Franklin, CEO of United Way of Northern New Jersey. ALICE stands for “Asset Limited, Income Constrained, Employed,” as United Way’s website defines it. Add ALICE to “those who meet the archaic definition of poverty,” and fully 40% of New Jersey residents live in poverty!

Well, Franklin defines ALICE as follows:

These folks are the backbone of our economy. People who are working every day, sometimes at more than one job, but still not making ends meet for basic necessities. It's our kid coming out of college, our parent living on social security, the person taking care of our parents in nursing homes, the one taking care of our toddlers.

"These folks," Franklin claims, deserve a claim on other people’s wealth. He lists 3 next steps to help combat poverty in N.J.:

The next steps are clear:

• Recognize the current definition and perceptions of poverty are woefully outdated.
• Help cut through red-tape and predatory practices denying ALICE access to existing supports like the Earned Income Tax Credit, the most effective pro-work, anti-poverty program.
• Expand access to quality child care. ALICE needs this in order to work. Plus, it reduces employer turnover costs and has a proven return on investment for our future workforce.

Redefining poverty has broad ramifications. Basically, it is an open-ended opportunity for statists to expand government and shrink freedom and self-reliance—and the wallets of productive citizens. After all, who but the very wealthy can not be said to be asset limited, income constrained, and employed? It sounds like life, to me. Hell, what it boils down to is that, at any given time and as suits anyone’s “anti-poverty” agenda, “basic necessities” can mean “anything one person lacks that other people have.” Short of a fully equal, universally poor, fully communist society, when is it ever not the case that some people have less than others? To the anti-poverty warriors, redefining poverty is about restructuring the Middle Class into a Welfare Class.

The Earned Income Tax Credit is basically a handout. I’ll acknowledge that, as a welfare program, it’s one of the least bad, since it at least requires a person to work to qualify. That said, “access” to the E.I.T.C. means access to wealth seized from other people against their will. The same goes for other “existing supports” Franklin mentions. The same goes for “quality child care.” When the statist talks of “access,” he doesn’t mean the wide array of goods and services available on the free market that people can access if they are willing and able to pay for them.

True, it can be a struggle to pay for all of the stuff we desire, to the point of having to forego some stuff in order to have other stuff we need more. It requires hard choices and prioritization of purchase desires—and sometimes charitable help from organizations like United Way. But when the statist talks of “access,” he talks of forcing others to pay, with government as the hired gun. But one person’s need or misfortune can not be considered an automatic claim on other’s lives and property. If it is, we’re no different from jungle animals. As civilized human beings, we must consider such a premise as thoroughly immoral.

Notice also what is ignored—policies that can actually aid economically struggling people in helping themselves. One big step that can actually help the poor “meet basic necessities” is a chance to opt out of the 15.3% FICA payroll tax that funds Social Security and Medicare. That huge bite comes right off of the top of every earner's paycheck. While government is seizing the wealth of the 60% to give the redefined 40% poor “access” to stuff, that same government is seizing the very means the poor can use to take care of themselves! To the statist, “help” only means forcibly redistributing wealth, not giving people the opportunity (access) to more of their own earnings.

Franklin opens his article with this:

A democracy is at its best when its citizens and elected officials come together to listen and share some good ideas, to engage in a dialogue about making the world a better place for all residents.

I left these comments:

Very well. Let’s start with this: Instead of redefining poverty to fit a political agenda that glorifies “the poor” as “the backbone of the economy,” how about talking about prosperity and its causes?

The everyday worker has always been around, and through most of human history lived in grinding poverty. Then, in the past two hundred years, something changed dramatically—poverty was ended.

Yes, we have relative poverty. But, there is no real poverty in America today. Real poverty is life without running clean water and indoor plumbing, electricity, automobiles, cheap plentiful clothing and food, and all of the luxuries like telephones, stoves, refrigeration, and washing machines that today’s poor have. And this is to say nothing of the smart phones, cable television, internet, personal computers, and other wonders of the modern information age that most people have.

What hasn’t been around until very recently are the extraordinary individuals who brought all of these and much more within affordable reach of the general consumers—not to mention the jobs they create and the tools of the jobs that make higher pay possible. And from all of this productiveness come the tax revenues the government needs to fund all of the re-distributionist, allegedly anti-poverty programs the politicians like to vote for. Governments, too, have always been around. If governments could truly “fight” poverty, human history up until recent history wouldn’t have been marked with grinding mass poverty.

I spent most of my plumbing career working for a business I didn’t create, in a job I didn’t create, working with tools I didn’t create, installing products I didn’t invent, with learned knowledge I didn’t discover, spending the money I earn in a marketplace flooded with products that I couldn’t conceive of, let alone create. Where did all of that come from?

General prosperity is so new in human history that most still don’t understand what caused it. The real backbone of the modern industrial economy are the inventors/businessmen/entrepreneurs, who arose with the advent of individual liberty and free markets to transform the knowledge of the scientist into the life-enhancing mass-market products and services that ended real poverty.

Anyone who does an honest days work in support of his own live and goals contributes to this abstraction we call “the economy.” In his own way, every honest worker is a hero for the effort to support himself. But there is a hierarchy involved in economic progress. Let’s not kid ourselves. It’s simply wrong to call the so-called ALICE group “the backbone of our economy.” It’s ridiculous to think that the wonderful standard of living we enjoy came from toilers, who today work a lot less hard than pre-capitalist toilers, and for a lot better living standard than those past toilers.

It’s not degrading to acknowledge that the real backbone of the economy is the extraordinary visionary minority that steps out from the crowd of toilers to bring us progress. It’s only fair. Once we understand that, maybe then we’ll get a real anti-poverty program going, which means not another government program but reducing the taxes, regulations, and demonization that holds the real economic progressives—the inventors/businessmen/entrepreneurs—back.

After 50 years and untold $trillions of welfare state dollars later, poverty is a bigger problem than ever before, if you listen to those with a vested interest in poverty. Yet “the poor” today have luxuries that the middle class didn’t have in the middle of the 20th century. Redefining poverty looks to me like another gimmick to keep the anti-poverty political agenda going with yet more handouts, like “free” child care.

---------------------------------------------

The United Way is a wonderful organization, when and as it relies on voluntary contributions of time and money. But when it turns to government’s guns to advance its anti-poverty crusade, it becomes a moral blight on a free and moral society.

Related Reading:

The "Relative" Poverty Gimmick

The "Relative Poverty Gimmick" Revisited

From Middle Class to Welfare Class

"Shared Prosperity" Another Name for Failed Policies

Liberty-Loving Americans Understand Bernie Sanders a Lot Better Than This Australian Thinks

Peter Ross, from what I can gather from his profile,—he “deconstructs the psychology and philosophy of the business world, careers and every day life,” whatever that means”—is an “ivory tower intellectual” living in Australia. Nonetheless, he penned an op-ed to explain “the Thing so Many Americans Can’t Grasp About Bernie Sanders.”

The “many Americans,” of course, are Sanders’ opponents. We just don’t understand Sanders, lectures Ross. Let’s see about that.

Ross plugs Bernie Sanders as representing “a point on the political spectrum that is mildly left of centre.” As if that tells you anything substantive. He doesn’t even define political Left and Right, so how are we to know what he means by “center?”

But, okay, few pundits actually define their terms. Be that as it may, what we can decipher is that Ross is an unabashed statist who apparently believes that all good comes from government coercion. He condemns American culture—we are all miserably unhappy, he asserts, without explanation—but forgets to tell you that the world's welfare states are on the verge of collapse, or that America’s Poor Are Richer Than Europe’s Middle Class, or that America’s allegedly oversized military budget has been the shield protecting Western Civilization from barbarians for the last 100 years, including Australia from the Japanese Empire in World War II and Red Chinese aggression after that and Western Europe from fascist and Soviet aggression on the other side of the globe, allowing our allies to get away with spending less on defense than they should.

But that and other stuff aside, Ross’s whole article is easily refuted. I won’t refute it all in this post, although I have addressed most of his claims elsewhere. For now, let’s address just a couple of his points:

[M]ore government programs means more jobs for people. Considering government jobs usually come with pretty decent conditions, that’s undoubtedly a good thing.

[B]ut are these value-adding jobs? The easiest thing in the world to do is make out-of-context assertions. But economic analysis 101 demands much more. Ignoring Frédéric Bastiat’s age-old observation about the difference between a bad economist and a good one—“The bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen”—Ross ignores what is not seen; he ignores consequences, while focussing only on the immediately perceivable. In classic Leftist style, Ross ignores the many more private sector jobs that are destroyed or don’t come into existence because of resources sucked by force out of the private economy to support the government jobs. Sure, the government can create plenty of “jobs”—it can pay people to dig and refill holes all day—because all it has to do is confiscate taxpayers money at gunpoint to pay for it. Private businesses, the real job creators, have to rely on voluntary consent of consumers to survive. We are all poorer for government programs because the people who fill the related government jobs are not productive, just redistributing what others have produced—i.e., they’re just digging and refilling holes. The destructive economics of government “safety net” programs—which are only made possible by taxing private enterprise in a market economy—is not the worst of it, though. They are immoral because based on armed aggression by government officials that deny people the right to spend their own money on their own lives as they judge best. The last thing that Ross, Sanders, or their supporters can claim is concern for the well-being of their fellow man.

That’s just one point. The article is full of fallacies. Everything Ross says can be refuted by logic, facts, context, and morality.

But let’s move on to fundamentals. Here, Ross gets to the crux of the matter:

Here’s the big thing about Bernie that makes so much sense to the rest of the world, but not to a lot of you. Our earliest ancestors formed tribes so we could hunt more efficiently and protect one another. We moved on to villages, then cities and finally nations for mutual benefit. We can do more together than alone, and when we band together we can put safety nets in place so if people are unlucky and get struck down, we can all help them back up. That way no one has to live in fear of losing out in the lottery of life. That’s what social democracy is, and those of us who live in them recognize that what we have is pretty damn great.

This paragraph strips away the pretense, and gets to the gruesome heart of the matter. Yes, socialism, however it manifests—full or partial, democratic or coup-d'etat—is a regression to primitive tribalism. America is the first country to explicitly reject, in its Founding philosophy, the tribal premise, establishing instead a country based on the freedom and sovereignty of the individual to rise as far as his ability, ambition, and personal circumstances will carry him—and to keep the product of his own labor as a matter of inalienable right. This feature powered America, in barely a century, from a mere colony to the most powerful economic and military power the world had ever seen. Tribal reactionaries, led by ivory tower intellectuals, have been fighting back against American individualism and self-responsibility ever since. Bernie Sanders is no progressive. He is one of the reactionaries.

The march of civilization is the transition from tribalism (these days usually referred to as collectivism) toward individualism. Collectivism holds that the group is the focus of moral concern. Under collectivism, the individual is subordinate to the group and can be sacrificed at any time and in any way, if the group deems such sacrifice to be to its good (the “public good,” the “good of society,” the “national interest,” the “common good,” "the people," etc.). Individualism holds that the focus of moral concern is the individual. Under individualism, individuals have inalienable rights to his life, liberty, property, and the pursuit of personal goals, values, and happiness, so long as the individual respects the same rights of others, and pursues his goals through his own effort and in voluntary, mutually consensual trade, association, and cooperation with others. No other humans, including government officials, whether acting alone or as a group (e.g., street gang or voting majority) may interfere in the individual’s pursuits. Collectivism (not to be confused with cooperation) fails because a group or collective is not an entity but an abstraction, so the practice of collectivism is always omnipotent government. Individualism succeeds because the individual is an actual entity, the only human entity that exists—the only entity that thinks, feels, values, judges, chooses, and acts. Collectivism leads to socialism, which is based on armed aggression. Individualism leads to capitalism, which is based on peaceful co-existence. Any subordination of the individual to the collective is barbaric and inhumane, as any ideology that repudiates the moral value of individual human beings must.

For example, as to the question of doing things “together,” the issue Ross evades is what he actually means by “together.” When Ross speaks of “do more together” or “band together,” he speaks of the togetherness of a chain gang built on aggressive physical force under a tribal central planner. Private individuals are capable of and do work together in myriad ways, without government coercion. But leaving people free to voluntarily act together, or not, is not Ross’s concern. The individual, in Ross’s collectivist world, is of no moral consideration—and this lack of consideration comes across loud and clear in his whole article. Ross blurs the moral difference between forced collectivization and voluntary cooperation, which is a black and white as you can get. If we accept Ross’s premise that “doing things together” means government forcing us to do things together, then there’s no area of our lives that is safe from collective aggression. This moral blurring is typical of people who want to enslave you to the tribe.

The only just and moral way of acting together is voluntary cooperation to mutual advantage, such as private business concerns or unions, clubs, private schools, charitable organizations (private “safety net”), sports teams, and the like. In an individualist—i.e., free—society, every individual is free NOT to participate. Try NOT participating in one of Sanders’s government programs—you’ll be assaulted by armed government agents, arrested, and thrown into a cage. But the people who do not want to participate in and pay for the government programs are not the concern of Ross, or of Sanders: Dissenters are, after all, individuals, and individuals are granted no moral consideration in the collectivist worldview. Collectivism is a slave culture—probably worse that ancient tribalism. Individualism is a free, progressive market culture.

Finally, in his conclusion, Ross writes:

And all of this ignores the massive, massive elephant in the room: that your corporations, banks and politicians have no qualms about being socialist when it suits them. They’ll happily put their hands out for subsidies that they don’t need to make billions more that won’t be taxed—or when they tank your economy and the rest of the world’s economy they’ll complain that they’re too big to fail before taking all your hard earned money.

True: The crony mixed economy, or mixture of socialism and capitalism, of controls and freedom, is certainly what we have now—and is precisely what Sanders wants to expand upon! More government taxing, spending, and government control of our lives only increases the incentive for people to want to influence the government officials doing the taxing, spending, and controlling; which, in turn, means more favor-seeking economic factions, and fewer free market economic factions. The housing boom-and-bust, and related 2008-09 financial crisis and Great Recession, is precisely what you get from the Sanders economy. Sanders wants to fatten up, not slim down, this “massive elephant in the room.” We need the separation of economics and state—laissez-faire capitalism—not more political corruption of the economy, which is Sanders’ immediate goal.

I say immediate goal, because Sanders’ long-term goal is anything but the “tweaking” of the status quo. It’s true that Sanders advocates more of the same of what we have now—a move further Left, but not a full socialist in the sense of government ownership of the means of production. But his ultimate goal is totalitarian socialism—not communism, but fascism, which is backdoor socialism. He’ll move us toward that goal by virtue of whatever socialist steps he can get away with. Sanders is a self-described democratic socialist, a convergence of two totalitarian systems. The problem with Sanders is not as much his immediate policies, economically bad and ethically immoral as they are, but their direction and intention—to pave the way for continued regression toward his ultimate goal, much as Obama's goal was to pave the way for a Sanders, and Johnson’s goal was to pave the way for Obama, and FDR’s goal was to pave the way for Johnson, and Wilson’s goal was to pave the way for FDR. And all along the way, they blame private enterprise capitalism for the problems their government policies cause.

I consider Sanders to be the most evil and dangerous major politician in America, for reasons I stated here. Oh yes, Mr. Ross, we liberty-loving Americans understand Bernie Sanders quite well.

Related Reading:

China’s Recovery from Socialism vs. Bernie Sanders, The Most Evil Politician in America

Sanders’s Open Socialism Blows the Cover Off of the Left’s Stealth Socialism

Bernie Sanders the Demagogue Enters the Democratic Presidential Race

Why Nazism Was Socialism and Why Socialism is Totalitarian—George Reisman for the Mises

Institute

Individualism vs. Collectivism: Our Future, Our Choice—Craig Biddle

Brazil’s Giant Problem—JOHN LYONS and DAVID LUHNOW

The Worship of Need: The Path to Communism

In answer to a previous letter-to-the-editor by John Caffrey, Tax the Rich--which I replied to on-line--another letter writer, Barbara Mierisch, penned a nice rebuttal titled Capital Gains. Caffrey held that need should be the standard for tax policy. Mierisch responded forcefully: 

I’m concerned about “Tax the rich” (letter, Jan 16.), which suggests no one needs a home for $14 million or above while there are people who need food and clothing. It led me to wonder who actually are “the rich,” because everything is relative. 

Are they people with assets beyond what are basic to survival? Perhaps the state should establish a bureau that is more aggressive than the IRS, with the power to evaluate, seize and redistribute assets. 

It might start with a benchmark for determining who are “the rich,” and quickly work down to include the financially solvent in that category. After all, who needs a one-family home with three bedrooms and two baths when some people must live in government-subsidized three-room apartments? 

When we start evaluating and condemning the spending choices of people who have greater assets than what others think they should have, we are embarking on a slippery economic slope, comrades, which has been unsuccessfully traveled before. 

Barbara Mierisch, West Orange

I left the following supportive comments:

Bravo, Barbara Mierisch! Well said. 

We have indeed seen this before. I would only add that that which you do not name--Marxian communism--was not only unsuccessful, but ended in the deaths of at least tens of millions, and the impoverishment of hundreds of millions more.

Sadly, the ideological premises underlying John Caffrey's "Tax the Rich" letter is becoming ever more deeply entrenched in our society, and reaches straight to America's political top. A nation of individual rights and justice cannot survive in a culture that accepts the idea that need is a moral claim on the wealth of others. Any ideology that enshrines theft as a moral ideal will, if left unchecked, lead any society that accepts it to ruin and mass slaughter. The logic of the premise leaves room for no exceptions.

Related Reading:

Justice, not Need, is the Proper Standard for Government Tax Policy

The Left's Egalitarian Trap

Free Market Revolution: How Ayn Rand's Ideas Can End Big Government, by Yaron Brook and Don Watkins

Mandated Paid Sick Days, Too?

This letter-to-the-editor appeared in the 1/17/13 NJ Star-Ledger:

Sick days   Everyone seems to know someone who has the flu, but we all probably also know someone who has to go to work while sick.   Even worse, years ago I was forced to bring my sick 7-year-old son to work with me. When I called to ask for time off to care for him, I was told that I had to be at work on time. I had little choice, not wanting to risk my job and with no one else to look after him, I grudgingly bundled him up and took him to work.   While today I have advanced in my career, I still do not have access to paid sick days. I find it incredible there is no New Jersey or federal law that guarantees workers access to paid sick days, despite public health advisories recommending sick people stay home. It’s time for our elected officials to make paid sick days a priority in New Jersey. 

Safiyyah Muhammad, East Orange

I left the following comments:

Safiyyah Muhammad’s letter (Sick days) offers a good indication of how deeply the entitlement mentality has corrupted America.

If paid sick days are that important to her, did she ever think of voluntarily negotiating with her employer to include them in her pay package; or seeking employment that offers sick day’s and is more accommodating toward working moms? How about setting aside money in a “rainy day” fund to cover her own sick days (which is exactly what I did during my entire 45 year construction trade career, which offered no paid sick days)?

Perhaps Muhammad’s demand is, in a sense, understandable, given all of the special interest pressure groups flocking around the government honeypot, demanding this or that economic favor at others’ expense. But it is simply wrong to force others to pay for your needs and desires, using the government as your hired gun.

The entitlement mentality is killing America, infecting even otherwise hard-working people.

Caroline Poplin's Swiss Cheese Defense of Social Security

Is Social Security misunderstood? Yes--by Caroline Poplin, a "policy analyst" who argues that "We should take Social Security off the table in this [fiscal cliff] debate" because--well--the program is "surprisingly misunderstood." But, Poplin's argument for maintaining Social Security in its current form is so full of holes that it could be mistaken for swiss cheese.

For one thing, she denies that, as currently structured, it is unsustainable; i.e., there is no unfunded liability. 

This claim is factually false. It is a mathematical, actuarial certainty that the Social Security balance sheet cannot sustain benefits at the current level. Estimates vary, of course, with SS's own trustees estimating an unfunded liability of $8.6 trillion and other estimates ranging up to $20.5 trillion. How could Poplin miss this obvious fact? She confuses reality with need:

Deficit hawks insist that the U.S. cannot afford benefits at the current level. They are wrong. Most middle-class Americans, now and in the future, will depend on Social Security for a dignified retirement.

If you have a savings account upon which you are regularly drawing to pay your bills because your income can't support your lifestyle, it makes no difference how much you depend on those withdrawals. If your account is not large enough to sustain those withdrawals, you're going to have to cut back on your expenditures, sooner or later. Every middle-class American knows that.

A bigger misunderstanding lurks in Poplin's piece, though:

Conservatives claim that the Trust Fund is a fiction – that the Social Security surplus was spent, not lent. That is wrong. The government borrows from the Trust Fund just as it borrows from China. If these bonds are not redeemed or rolled over when they come due, the U.S. will default. Any other result would be a betrayal of President Ronald Reagan, Congress, and millions of boomers who paid trillions of dollars in extra taxes over four decades to secure a dignified retirement.

Suppose you decide to begin a systematic savings program of $100.00 a month. However, instead of depositing that money into a bank or mutual fund, you hand it to your spouse every month. In exchange, your spouse hands you an "I owe you $100.00" piece of paper, then goes out and spends the money. Years later, when an unexpected expense hits you, you hand your pile of I-owe-yous to your spouse. Instead of handing the accumulated savings back to you, your spouse puts her hand out and says, "In order for me to redeem these I-owe-yous, you need to give me the money to pay you back."

This is the misnamed "Trust Fund" that Poplin lauds, with one important difference: The money will have to be paid back, not by you, but by other, younger workers. Your SS tax money was spend, just as the spouse in my story spent the "savings" entrusted to her. However, the real-life spouse--the government--won't be turning to you to redeem your own savings, since you are now retired and no longer working. It will turn to your neighbor, who will have to cough up the money to redeem the Trust Fund's pile of I-owe-yous (government bonds) that your benefits depend upon.

"Social Security is often described as a pay-as-you-go system, with taxes from current workers going to pay benefits of today’s retirees," writes Poplin. And with good reason: It's true, Poplin's denials notwithstanding. The money a worker pays in Social Security taxes today goes toward today's retiree benefits, with any surplus in tax collections going into the Trust Fund, which is then spent by congress. Either way, the money is spent. It's gone. It was not deposited in an investment fund, available to provide capital fuel for economic growth--business expansion, factories, new technologies, labor-saving devices, and other productive activities. Your money is not part of a growing account balance spurred by investment returns thrown off by current production. Like the spouse in my story, the money is consumed. The only way to replace it is with taxes on future production, which will not be there because the money was not invested in the productive capacity to provide it.

Poplin notes that "Social Security payments ... are backed by the full faith and credit of the U.S. government." Who backs the government? The productive taxpayers. Just as the spend-thrift spouse had to turn back the the source of the original $100.00--you--to make good on your $100.00 I-owe-you, so the government will have to turn back to its original funder--the taxpayer--to make good on its "full faith and credit," which rests on that very same taxpayer. It's nothing more than a con game, played out in full public view for all but the Caroline Poplin's to see.

Social Security is "more important now than ever," says Poplin, because

with median income stagnant over the past 30 years despite the rising cost of housing, education and health care, it is difficult for many to save such large sums. That is why Social Security, which guarantees stable payments for life, is so valuable and must be protected.

With programs like Social Security diverting vast sums of earnings from productive investment and savings to consumption, is it any surprise that incomes are becoming stagnant? The only way for retirement savings to be able to provide for retirement is for them to provide the investment capital for economic growth--which means, productivity growth. Productivity raises the value of saved dollars, which can then be exchanged for the goods and services you'll need in retirement, which you'll be able to afford without soaking other, younger workers. Poplin's argument amounts to; SS helped reduce our current standard of living, so we'll need SS to help maintain that reduced standard of live, which will keep on declining because we continue to spend, rather than invest, our retirement "savings" in our spouse's (the government's) empty I-owe-yous!

Poplin concludes that "Social Security ... should not be part of any 'grand bargain' to fix [the deficit]." Not only should it be part of the "grand bargain": It (along with Medicare and Medicaid) should be at its center.

My own solution is: The government has had its chance at running our retirement savings, and it has failed. While I believe that SS is immoral and should be abolished, this is not yet politically feasible. What is feasible is a transition to self-directed personal investment accounts, into which all 12.4% of each worker's SS contribution would be deposited, beginning with younger workers. To get this transition started, a compromise may have to be made with the Left to bolster the accounts of the lowest income workers. This can be accomplished through matching government deposits that keep the lowest income workers at some minimum level of SS account balance, phased out as incomes rise.

This is still immoral redistribution,  but at least the low-income worker would have ownership control, and would have to be working and paying into his account to qualify for the matching grant. Best of all, the laundering of SS taxes through Washington would end. 

Related Reading:

The Social Security Injustice

The "Personal Account" Path to Ending Social Security

Social Security and the "Hypocracy" Charge