What Social Security reform would mean for blacks
Posted on January 6th, 2005 in General, Social Security by tavaresforby ||
I came across an article on the benefits of the Social Security reform for blacks.
As the system currently is structured, he notes, many blacks suffer a negative rate of return on their payroll taxes.
More generally, the working poor get a bad deal from Social Security: as longevity is correlated with economic status, many don’t like long enough to recoup their payments. And because Social Security today is a promise, not an asset, there is no balance to bequest beyond survivor benefits. As Lowry explains, “In the current system, if someone dies and has no wife or children, the money he has paid in simply disappears.”
So why don’t progressives support reform? Lowry argues that “the wages of low-income minorities” are necessary part of a system that now primarily serves to “subsidize the retirement of wealthy, healthy, long-lived baby boomers”–a middle-class entitlement.
There is some logic to that, but let us offer an additional explanation: dependency. It’s a very different thing when a retiree draws on his own savings than when he gets a check from the government. If Americans had more control over their retirement savings, they would be less dependent on government and those representatives to government who purport to look out for their interests and keep the checks coming.
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