Tuesday, July 19, 2011

Social Security, how we got here

Here is a great analysis of our Social Security program AND how we got into this "fine mess", from our friends over at Grumpy's place.

July 18, 2011
Last week Barack Obama tried to force a budget deal with Congress he'd find favorable.  If the debt ceiling wasn't raised (his way), he threatened to stop all Social Security and Federal Retirement Checks from going to to people who paid into those funds all there lives. Unfortunately he has that authority. I noticed he didn't mention stopping funding for his pet agenda programs or Air Force one. Obama care, to which no one has yet been forced to contribute to, would it seems still be funded as would his Race to the Top agenda.. Once upon a time, he would have not have had that power.
FDR Contributions will never
be used for anything except
Social Security

When Franklin Roosevelt started the Social Security Program, he swore to the American people the fund would never be used to fund anything except Social Security and under no circumstances would it ever be used to fund other government operations or programs. FDR died, it took a while, but so did his promise.

In the mid 1960's, Lyndon Johnson had a problem, actually he had a lot of problems, come to think of it he, himself was a problem, but that's another topic.  He'd started a war, a big very, very expensive war.   He'd also initiated his "Great Society" the largest social program the United States had ever undertaken and it wasn't cheap.  He needed money, and a lot of it, he also needed it quick.  Calling up the Federal Reserve and asking them him up an extra hundred billion or so wasn't an option.  Prior to 1964 the Federal government had to own a dollars worth of silver for every paper dollar it printed... Even though Johnson had managed to do away with that pesky little rule Americans weren't ready to accept the idea the Government could just print money on a whim.
America was safest when
LBJ Slept
The only place that had the kind of money Johnson was looking for was Social Security... From it's creation in 1935 Social Security had generated a "surplus'  by the time Johnson took office the surplus was huge, and it was just sitting there for the taking..  Except for a little law that said Social Security couldn't be touched for anything except Social Security and it was never to be placed into the General Fund...