Thursday, June 19, 2008

Solving the Social Security Crisis

Why do we have to increase taxes?
There is absolutely no reason. There is a much simpler solution and it is based on the original set up of the social security system. When social security was conceived and how it basically works today is today's payers are paying for today's receivers. This works great as long as you have more contributors than recievers. So in the future we need more payers than receiversas well.
Our government thought there would always be a surplus because we have an ever increasing population. since population growth has slowed and people live longer the reciever end is ballooning while the payer end is shrinking.
here are two ways to increase the population to increase the number of payees so that the system remains solvent. One is to encourage legal immigration so that the young immigrants pay social security tax into the system. second is to encourage business through tax incentives and other programs to encourage working families to have more children. For instance increasing maternity leave to a year as the are doing in Western Europe as well as having more kid friendly workplaces, such as on site child care. Having flexible work schedules so that two working parents can manage child care and having a family.

The bottom line is simple if we keep going down the path we are on we will end up with an inverted pyramid. the few payers paying for the massive number of recievers. And the payers will have to give more of their pay because they are supporting more retirees per worker.
The simplest solotion is to have more payers to share the load. think of it this way its alot easier to have 20 grandchildren supporting grandpa than one.

So go out and tell your congressman you want to have more kids to solve the social security crisis. When he looks at you funny show him this blog. when he looks at you even funnier tell him it takes how many taxpayers to pay your salary. What if there were fewer taxpayers. Which in just a few years there will be if we keep going down this population path.

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