- Jul 10, 2002
It is Ponzi financed. The reason it is ‘there for you’ is that they have raised the FICA tax 12 times since 1967.
The early entrants to the Ponzi get paid more than they put in, so they can tell other dummies it’s a great scheme.
That 6.4% payroll tax you faced in 1967 is now 15.3%.
Mathematically, everyone born after 1975 is facing getting back less than a buck out for each buck they paid in. That’s what happens in a Ponzi that is funded by robbing Peter to pay Paul.
Raising the tax and/or lowering the benefit is all that is on the table for future generations. None of them get to rob the future generations to the degree you and your parents managed.
It's not intended to be a 1 for 1, never was. It was intended to be assistance for those who have no other means of retirement income...Basically a safety net.
Of course, when there are people out there with the thought process of "I'm getting mine, screw everyone else" there are problems.