Published: March 18, 2008 07:15 pm         

THE WAY I SEE IT: The danger of social insecurity

As we ponder which presidential candidate will give us the most charity, we should really take into consideration all the other things that our government has done so well. All of our mail problems were solved when they "privatized" the Postal Service. Years ago, we had mail delivered to our homes twice a day, and for a nickel. These days, we can stand in line until we qualify for Social Security benefits. That is called bureaucratic progress.

And, speaking of Social Security, we might be well served to take a hard look at the birth of that program. The year was 1934. The Great Depression was in full swing. In Chicago, Al Capone was winning over the public by sponsoring soup lines. The federal government was in dire need of revenues, but there was no way to raise taxes. To attempt such a thing could have ignited the second American Revolution. So, in their infinite and deviate wisdom, the Congress came up with a better plan. It was called Social Security.

They adopted the German plan that called for a retirement age of 65, because in those pre-war years the average life expectancy was 62. Less than half the contributors would ever make it to the benefit level. Those who didn't would sacrifice their contributions. What was being sold to the public as a "benefit" was actually a creative new tax, in an environment that made new taxes impossible to collect. But, there were problems.

A group of major mutual insurance companies, known in the industry as the Big Seven, approached the Congress with an offer to help. They liked the idea because every American would immediately become insurance conscious. Their markets would expand exponentially, and it wouldn't cost them a penny in advertising. They offered to provide the government with all of the actuarial work, at no cost. After all, the Big Seven was the most experienced body in America in that critical statistical field. The Congress had no experience at all. At first, it appeared the partnership would be very effective.

The Big Seven actuaries told the Congress that, if they managed the Social Security Trust Fund properly, by the year 2000 it would be fully funded. There would be no more contributions needed after that date, regardless of how large the population grew or how much inflation would impact the economy. But, there was one small proviso. In order to make this utopian dream come true, the Social Security Trust Fund would have to be managed under the same rules and regulations Congress imposed upon those insurers.

But, that would mean the funds would have to be managed responsibly. The moneys would have to be accounted for. The citizens, who would be the beneficiaries of that Trust, would actually own their retirement benefits and could pass them along to their heirs. The American Dream was within reach, but only if Congress acted with integrity. But, if integrity meant they couldn't get their hands on that money, the answer was no! That is why the Social Security Trust Fund is a fraud. You cannot repair a fraud. Think about that when you hear candidates talk about taking over our health care system. The people incapable of managing your pension now want to manage your life and death.

Robert Evans Burnette is a Crossville Chronicle columnist. His column is published on Wednesdays.