Social Security spending hit a new high in Fiscal Year 2015. For every person receiving Social Security and disability benefits, there were only about two people working full-time. The increased spending levels translate to about $7749 per full-time employee, or nearly 15% of the median income.
The growing spending gap may result from an aging workforce and insufficient full-time employment opportunities, but cost saving measures, raising the cap on taxable earnings, a higher retirement age for non-labor workers, converting the program to a need-based insurance plan, and others steps can be taken to address the higher costs of Social Security. The real problems, however, are the National Debt and growing income inequality.
uite frankly, Social Security spending is a problem today, because the US Federal government spent too much, did not tax enough, and borrowed from the Social Security trust fund to pay for both. How we got into this predicament does not, however, change the fact that there is a problem. It must be addressed sooner rather than later or Social Security will collapse along with the Federal Budget.
The pressure on Social Security and the National Debt can also be relieved by growing the economy. Certainly, proponents of the Transpacific Partnership (TPP) Agreement will jump on this argument to promote their plan, but free trade is likely to fuel increased economic inequality as was the case with NAFTA.
The simple truth is that the vast amount of Americans earn closer to $30,000 or a less a year, so $7749 is an amount most cannot afford. Helping boost earnings across the board will ease the burden on Social Security and the National Budget. In fact, inflation demands steadily increasing wages to ensure incomes do not shrink with the decreasing value of the dollar, even though most Americans face few opportunities for increased wages.
That said, the political Right often uses unsettling news about Social Security to promote solutions that further undermine Social Security. Calling the program a Ponzi Scheme, one of the most popular solutions is to privatize Social Society, which means devoting a portion of someone’s social security funds to the stock market. Unfortunately, the stock market is uncertain while predatory traders have turned the stock market into a Ponzi Scheme of its own. There will always be winners and losers on the stock market, but these factors guarantee most Americans will lose most of the time.
Furthermore, the dilemma with Social Security is that as income inequality grows along with the National Debt, taxes increase, and living expenses skyrocket, dissolving Social Security would only exasperate these problems for those most harmed by them. It is, of course, important to remember Social Security was created at a troubled time to save the aging and infirm from destitution once they could no longer work. A failure to address the challenge of repairing Social Security exemplifies the inability of current leaders to overcome personal differences in order to govern.
As the benefactor of political infighting and Ring-wing hardliners, House Speaker Paul Ryan has already made it very clear that Obama Administration priorities, such as immigration reform, are not going to be his priorities.
With the lame duck President in his final year and a budget deal relieving the new Speaker of any political pressure from any impeding government shutdown, little is likely to be accomplished over the next year.
Given the intensity of the 2016 Presidential Election and extreme polarization, a prudent politician understands it is in his best interest to avoid policy initiatives that try to address the issues the US desperately needs to solve. After all, critics will create controversy.
The truth is that Paul Ryan has been willing to spark controversy and commit political suicide in order to accomplish something big. A fiscally responsible budget has long been a top priority of Ryan. In 2011, he unveiled a budget that demonstrated exactly what a balanced Right-wing Budget would look like.
In reopening the Budget reform process, Ryan risks his own reelection and his Party’s Majority status in 2016. He also risks handing Democrats the entire Legislative and Executive Branch. After all, the populous economic policies of Democrats tend to be far more appealing than those of the GOP.
On the other hand, the National Debt is a ticking time bomb while the perpetual threat of government shutdowns undermine the economic stability of the United States.
Despite the lack of political incentive to address America’s budgetary issues and ballooning National Debt, House Speaker Paul Ryan’s personal interest in budget reform might be enough to make the issue a top priority. If Paul Ryan is a statesman, instead of just a self-serving politician, President Obama has an opportunity to accomplish something big with the new House Speaker.
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