In 1935, a great idea grew out of the Great Depression....Social Security. What an idea! In a bet that Las Vegas would appreciate, people who lived past 65 would receive a monthly check to help defray living expenses until death. But, statistically, death would occur at 62.
In the 75 years since its inception, Social Security has gone on to become the insurer of all, the ultimate safety net, the protector against poverty in old age. It's had several revisions, each time adding a little weight and cost.
In those 75 years, we've managed to live longer, a lot longer. What used to be a sure bet at cost containment has turned into a sucker's bet of cost
Like loading up a backpack, the load of Social Security has become too heavy to carry. It's slowing down the economy to a crawl. It's killing us.
I have a plan. It involves three elements and it will require sort of a Chapter 11 of social services. We have to reorganize the way we think.
The first part of the plan is to index the start of Social Security to our expected death, because the commitment is to the length of time to our death, not from our birth. If the index is to years of our statistically timed death, to some degree, we can control the cost of taking care of our elderly.
This will require workers to work longer, probably until the age of 70 today. The impact of these workers staying in the workforce, paying taxes and not drawing on Social Security would be approximately $300 billion.
The second element of this plan would be to recognize that any product imported and paid for with American dollars should have some responsibility to our social safety net. Last year, we imported over $1.6 trillion worth of goods, or about 11% of our gross domestic product. Suppose we place a tariff of 16% (employer plus employee portion of Social Security) against those goods to cover the Social Security portion of our economy. This would net $250 billion to our economy.
Finally, we need to stop tying years of public employment service to retirement benefits. Teachers, postal workers or any public employee retiring at 55, with arguably 30 years of life expectancy in front of them, is not the kind of economic model that lends itself to a solution.
Public service has turned into a kind of work one year, get one free program. We just can't afford it anymore. Teachers and public employees need to work under the same rules as the rest of us, and they need to provide income to our economic engine.
So, there it is; my plan to save Social Security.