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From: welsch@houxu.UUCP (Larry Welsch)
Newsgroups: net.politics
Subject: Social Security
Message-ID: <509@houxu.UUCP>
Date: Sun, 20-Jan-85 09:06:21 EST
Article-I.D.: houxu.509
Posted: Sun Jan 20 09:06:21 1985
Date-Received: Mon, 21-Jan-85 02:57:52 EST
Organization: AT&T Bell Labs, Holmdel NJ
Lines: 58

There seem to be a large number of folks on the net who do not like social
security and seem to be of the opinion that they would be better off
without it.  Oh I hear you out there now.  It sounds to me like you do not
understand why social security was formed in the first place and why it is
important today.

The main reason social security was formed was to provide protection for
all the hard working folks who worked their asses off being good citizens.
They had savings, stocks, bonds and houses from their life's work and then
the great depression hit.  The savings, stocks and bonds were worthless
and their houses were repossessed by the banks (oh yes there was this
marvelous concept of demand mortgages back then, any time the bank wanted
it could demand the mortgage paid in full and if you didn't have the
money you lost your collateral.)   Social security was a form of
protection for people who worked all their lives just to discover that
their life's savings was worthless, due to conditions beyond their control.

Social Security is still necessary today for exactly the same reason.
Think of the people who retired in 1970 say they had hundred and fifty
thousand dollars to their name, which was a lot of money in 1970
Assume they owned their own home and planned on living off the interest at
about 6% or $9 thousand a year.  Possible in 70, forget it in 1984.  Oh I
grant that maybe they could get 10% a year now or 15 thousand a year,
but it just wouldn't cut it.  I make over 5 times my salary of 1970, but
just to make 3 times or 27 thousand dollars would be significant to them.
What happened, inflation!  Social Security COLA's are protection against
inflation.  

Now for some kickers.  Banks are still failing, and not all banks are FDIC
insured.  Also to get 10% on your money you have to use non FDIC insured
form of investment.  Or another words people have to RISK their savings
just to maintain a decent return.  Finally, the single biggest expense
older people have is medical.  Medical expenses have gone up more than any
other type, so the probability of older people being able to not touch
their principle is low, since they would need to pay their medical
expenses.  

Now, what about social security running out of money, well horse pukkey.
The social security system is sound, as a matter of fact Reagan is eyeing
the money in the social security trust fund to pay the cost of running
government.  How, you ask?  Simple, buy government bonds at below the going
interest rates.

What social security needs is not to be disbanded, it should be
strengthened.  How?  Simple, put the tax on one's whole income and make it
progressive.  Also, charge employers a progressive social security tax.
For every dollar of an employees salary that is over a hundred thousand
dollars, the employer must add a a matching dollar to the social security
fund.  Further, every time prices are raised for a given service or
product, then the social security fund must get half the amount of the gross
income due to the increase in price.  

Some other things that can be done is pass laws dictating that companies
can not have mandatory retirement regulations.  Raise the age that social
security starts to 70 or 75.  

							Larry Welsch
							houxu!welsch