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Easy Fix for Social Security and Medicare?

The Herald - 6/23/2018

Recent news stories about a possible shortfall of funds for Social Security and Medicare have a lot of people worried. We can't keep spending money on health care for older folks and their retirement at the rates we do now because Social Security and Medicare are both facing shortages. In other words, money is coming out faster than it's going in. And all this talk about Social Security failing has a lot of younger people convinced it's not worth fighting for. Wrong. The simple fact is, America is the wealthiest country in the history of the world. If we want Social Security and Medicare to be there for everyone who needs those programs, we need to fight politically to make sure they are there.

So, the easy fix is to put more money into the funds. But where will we get more money? Well this is not a new problem. Back in the 1980's when there were similar funding concerns, Jesse Jackson gave us some good, if obvious advice: "You have to get the money from where it's gone." We had cut taxes on the wealthy and invested heavily in more military, so it was suggested that we have upper- income folks pay the same percentage to Social Security and Medicare as everyone else.

Unfortunately, we didn't do that. Instead, the Democrats-led by Tip O'Neill-and the Republicans, following the lead of President Reagan, "reached across the aisle" and cut benefits. Millions who worked hard all their lives at two or more jobs-such as teaching and waiting tables-had their pensions cut. Millions of retirees are living on less right now because of these cuts in the '80's.

So, progressive or moderate Democrats should be wary of "reaching across the aisle" to today's Reagan Republicans to solve any problems of working people. The two political parties are not just social clubs with different names. The Republican Party mostly serves the interests of the business community, not working people. The Democratic Party, from Franklin Roosevelt to Barack Obama, generally tried to serve working people first, though a shift toward business began with President Clinton. A more progressive way to deal with the projected shortfall in Social Security funds would be to raise or remove the cap on contributions to the funds. Right now, the well-to-do only pay Social Security on the first $127,200. Anything they make above that is not subject to Social Security tax.

Now, we're always told that potentially huge financial success is what motivates the "job creators," as Mitt Romney called them. Of course, Mitt himself inherited a fortune from his successful dad, George. If you look closely at today's super-wealthy businessmen, most of them got a head start from wealthy parents, education at a prestigious college, or both. Naturally, they don't usually advocate higher taxes. But the lives of innovators like Mark Zuckerberg of Facebook, Bill Gates of Microsoft, and so on, reveal they are typically motivated by the excitement and challenge of innovation, not necessarily the desire to become billionaires.

Some of the alarm being sounded about Social Security is just political hype. You hear that Social Security will be "broke" in 2033, or so. In fact, it will never be flat broke-empty-unless everyone stops paying into it. If no changes are made, beneficiaries would see a gradual reduction in pensions, not a complete stop. The average Social Security monthly benefit is $1,404, so anyone living on Social Security alone could be devastated by a benefit reduction.

Programs like Social Security and Medicare bring not only the obvious benefits to those who receive them, but stability to the stock markets, and a sense of fairness to the whole society. As billionaire Warren Buffett has pointed out, he should pay a higher percentage of his income in taxes than his secretary. That's a logic hard to argue with. "Taxes are the price we pay for civilization," as the old saying goes. And everyone has to pay a fair share. And while we're at it, maybe we should spend more on the needs of our fellow Americans and less on trying to run the Middle East with seemingly endless and frightfully expensive wars.

Columnist Jack Burgess is a retired teacher of American & Global Studies and a US Army Veteran.

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