Just in case you haven’t noticed, the AARP – and a goodly percentage of “older folks” – have recently declared war on the working American – and have defined themselves as racist pigs at the same time.
This is no small matter – nor is it something that any American should ignore.
Class warfare is nothing new, of course. Indeed, it is part and parcel of American Politics.
But this is different.
When the AARP declared that they would “pull out all the stops” to prevent real reform of Social Security, they declared war on every person who is less than 50 years old – those of us who will have the current Social Security System turn insolvent before we begin to collect benefits.
They also declared war on every African American Male.
Yep – they declared war on Black Americans.
How come? Let’s explore this……
First, the racist overtones of the current Social Security system…
As you probably know, life expectancy varies depending on your year of birth, your gender, and….. your race. These statistics are used in the life insurance industry (among other places) to provide a basis under which various costs are computed – including your cost for life insurance.
On average, a white female born in the last few years has a life expectancy of 79 years.
A black male born in the same year has a life expectancy of 69 years.
The full benefit retirement age for Social Security is currently 67.
That is, a black male pays into Social Security for 49 years (assuming he starts working at 18), and collects for two years.
A white woman pays into Social Security for the same 49 years, but collects for 12 – or six times longer than the black man does.
Six hundred percent longer.
This may have been a historical accident, but one cannot ignore what it is today.
Supporting a structured system that causes black men to obtain only ONE SIXTH the benefit of a given government program as a white woman, when BOTH pay the same amount of tax over the same amount of time to fund that program, IS RACIST.
If a banker charged a white woman 6% interest, and a black man 36% interest for the same loan over the same amount of time when they had the same assets and income backing that loan, we would all call that person a racist banker.
This is PRECISELY what the AARP is supporting - institutionalized, government racism.
The AARP CANNOT dodge this reality, no matter how hard they try.
Second, let’s look at the “no changes” policy.
In approximately 25 years, the system will go into the red. That is, the system will draw more money in payments than it takes in through taxes. Note that there never has been any “lock box” for the taxes collected – that money is simply put into the US Treasury, where the politicians in Washington immediately spend it.
When this happens, the government will be forced to change its policies. Taxes will have to be raised, the retirement age will be raised, or benefits will be cut – or some combination of all three.
Note that if the retirement age is raised further, then a black man will, on average, receive nothing for his Social Security taxes. That is, he will pay and get back nothing whatsoever, because on average he will die before he can collect!
Slavery was supposed to have ended more than 100 years ago. But did it really? Or did the racists just find new, sneakier ways to enslave African Americans?
If benefits are cut – probably through a “means test”, then those who plan for their own retirement (by saving, investing in a 401k or buying a house, etc) will be penalized by not getting anything – while those who gamble away their life savings, spend all their money on expensive cars and boats, and generally mismanage their finances will be bailed out by the rest of us. In other words, you’ll be penalized for being intelligent and prudent, and rewarded for intentionally destroying yourself financially.
If taxes are raised, where does it end? Is it not obvious to anyone that as the squeeze continues, that at some point working people will revolt, correctly figuring out that they will not get their Social Security checks when they retire? Of course they will – the only question is when it will happen – not if it will happen.
So exactly what does the AARP think they are doing? By insuring the destruction of the system that is currently in place, they are protecting “theirs” are the cost of the economic future of their children and grandchildren - and, of course, Black Americans irrespective of their age.
This is an intelligent choice and position?
It is clear that Social Security needs to be changed. It is also clear that there is no way for the system to remain solvent so long as the government has its fingers in the pie, they own the money in “your” account, and they are able to confiscate it any time they choose.
We must reform the system into something similar to Chile’s. Not long ago, Chile saw the same “train wreck’ coming that we have coming for our Social Security system. Indeed, Chile originally designed their system around ours.
They changed their system, just as we must change ours.
Here is what they did – and what we must do:
- We must get rid of the fiction of an “employer match”. That’s pure nonsense, of course – a forced tax on an employer as a “head tax’ is simply deducted from your pay. You pay ALL of the Social Security Tax – personally – its just “hidden” from you. The law must change so that this is simply illegal – period.
- For the next 12 years (the expected life of a retiree today, worst-case), the tax rate must remain the same as it is now – 12.4%. Over the next 12 years the withholding amount which goes to the government’s current Social Security system will be reduced by 1%. That 1% cumulative amount will be credited to an account which you own. These deductions will be pre-tax, as they are now.
- Investment firms may apply to manage these funds, and you may choose freely between them, as well as transfer funds between them at your will. These firms will be prohibited by law from doing anything other than managing these accounts – no investment banking, etc. In addition the BETA of any offered investment product in these funds may not exceed 1.0 (that of the market generally.)
- After 12 years, the entire system will be privatized and the “must save” rate will be set at 10% of gross earnings, pre-tax.
- When you retire, you must draw down the funds at a rate no greater than that of your balance divided by your life expectancy. That is, you may not intentionally exhaust the funds at a rate that is likely to leave you broke before you die. You may, however, draw them down more slowly if you choose. You may also purchase in whole or part, an annuity with the funds from an insurance company (these products are offered now by various firms) – this is the only exception permitting a “bulk” withdrawal of your Social Security account.
- If, at the maximum permitted withdrawal rate, your payments (with that of your spouse, if married) would not meet the federal poverty level for your household living arrangements (either single or married), the government will subsidize you directly with the difference up to the federal poverty line.
- Your account is yours. If you die, you may leave it to your heirs as you so wish.
Will this require “huge deficits?”
No. The change-over will match exactly the life expectancy of the longest-living portion of the population - white women. It therefore is actually revenue-positive and should result in smaller, not larger, defecits.
But it will force the government to immediately stop raiding Social Security deposits. The slow transfer out of the “government” to a private system follows exactly the life expectancy curve, thereby insuring that there will be no “run” on the Treasury.
Why would the AARP not like this plan?
Good question – they should like it. In Chile, when people retire today, their income generally goes up – instead of down as it does for workers in the United States.
Until the AARP comes to their senses and supports this plan, or something very similar to it, I call for everyone to boycott all AARP members.
Yes, you heard that right – if someone is an AARP member, they are supporting the financial rape of our children and grandchildren. Therefore, we should not employ, sell to, trade with, or associate with these people.
They are the sworn enemies not just of us, but of our kids.
Its put up or shut up time for the working man and woman.
