Forbes Article: The Under-30s Should Demand an Opt Out of Social Security

[lx43]

http://www.forbes.com/sites/merrillmatthews/2011/11/11/the-under-30s-should-demand-an-opt-out-of-social-security/



The crime isn’t that some people get more in benefits than they contribute; the crime is that so many people—including those who die early—don’t get back nearly what they paid. And the under-30s know they are at the forefront of that swindle.

It’s time they stand up and demand a better deal. Let the candidates know that if they want the “youth vote” in 2012, they have to support an under-30 opt out of Social Security—while fulfilling the government’s promise to current retirees.

I agree with that part of the article.

[Zippyjuan]

The problem is its impact on the budget. The money going to pay the "government's promsie to current retirees" comes from those paying Social Security taxes in the same year. If people are allowed to opt out, then that money has to be replaced somehow- higher taxes on other things, more government borrowing (higher debt) or cuts in spending in other places. In 2009, Social Security taxes collected came to almost $950 billion- compared to $1.2 trillion in income taxes. If that money were to not be collected and the difference collected via income taxes, those taxes would have to nearly double. If you cut spending in the "discressionary" portion of the budget to cover that shortfall, you would have to get rid of everything but $250 billion worth (that would get rid of everything but less than half of the Department of Defense). Or instead of having a $1.3 trillion added to the national debt you would be adding $2.25 trillion a year. At that rate, the current debt would double in six years (assuming everything else was frozen).

I realize that Ron Paul has also suggested the same idea, but it does conflict with his other goal of trying to balance the budget and eventually reduce taxes for everybody.

[oyarde]

I agree , even people in 40's are screwed .