Though compulsory social security has been the law of the land for little more than a generation, many citizens of the United States are now convinced that they couldn’t get along without it. To express doubts about the propriety of the program is to invite the question: "Would you let them starve?"
Millions of Americans are old enough to remember things that happened prior to passage of the Social Security Act in 1935, but where is one of them who ever watched a human being starve? No, we wouldn’t "let them starve." Anyone would have to work hard at it, in secret, to approach starvation in this country! So why is it so widely believed that, without social security benefit payments, many people would go hungry?
The social security idea is based on the questionable premise that a man’s usefulness ends at age 65. He is supposed to be without savings and without capacity to continue to earn his living. If that premise were correct, it would be easy to see how hunger might develop among the aged. If they’re really good for nothing, who wants to be bothered to look after the old folks!
Lumping people into groups and jumping to conclusions about each group—people over 65 would go hungry without social security—is standard socialistic procedure. A corollary socialistic conclusion is that breadwinners under 65 must be compelled by force of law to respect and care for their elders. These conclusions rest on false assumptions made by those so lacking in self-respect that they can have no faith in anyone else as an individual. Their faith is in coercion, and they thus conclude that government holds the only answer to every problem.
To those of little faith, it is necessary to explain again and again and again that government is noncreative and can distribute only what it first taxes away from the productive efforts of individuals. "The people" are—first, last, and always—individuals, some more economically creative than others, but each worthy of respect as a human being. To tax a man’s earnings and savings, for other than defensive purposes, is to reduce his capacity and his incentive to care for himself and for others, rendering him part slave to others and thus less than human. Furthermore, he also is enslaved and debased who either volunteers or is forced to look to the taxing power of government for his livelihood.
Slavery has been tried in the United States, unfortunately, and a major reason why it failed is that it was, and is, an unproductive way of life; it lets people go hungry. It also is morally degrading to slave and master alike. Yet, we are being told that without compulsory social security taxes upon the young and strong, the oldsters among us would go hungry—perhaps starve; we are invited to try once again a semi-slave system—under benevolent masters, of course. Well, those socialists are dead wrong. Their premises are faulty. Free human beings may be counted upon to care well for themselves and for their fellow men, voluntarily.
An Immoral Practice
What should concern us all is that, if we persist under the false premises of the social security idea (socialism), many Americans will go hungry—not only physically hungry, but morally and spiritually starved as well.
The prime argument against social security is in the moral realm. Giving to one individual or group the fruits of the labor of others taken from them by coercion is an immoral procedure, with destructive effect upon the sense of personal responsibility of everyone involved. But there are sufficient reasons for rejecting the program, even from a strictly materialistic point of view:
1. It is not old-age insurance; it is a regressive income tax, the greatest burden of which falls on those earning $4,800 or less annually.
2. The so-called social security fund of about $20 billion amounts to nothing more than a bookkeeping entry, showing how much money the federal government has borrowed from itself in the name of social security and spent for other purposes.
3. The fact that an individual has paid social security taxes all his life does not mean that any of that money has been set aside or invested for his account; if he ever receives social security benefits, they must come from taxes collected from others (perhaps even from him) at the time.
4. The matching amounts, presumably paid by employers on behalf of individual employees, are in effect paid by the employees either through reduced wages or through higher prices for goods and services.
5. Offering a subsidy to those who retire at age 65 does not provide additional savings for plant and tools and thus create jobs for younger workers; it increases their taxes.
6. A person now entering the social security program at age 20 is scheduled to pay $1.69 in taxes for every $1.00 promised in benefits.*
*For a more comprehensive review of these and other arguments against compulsory security, see "The Social Security Program" in The Freeman, November, 1962; copy on request.
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Do It Yourself!
I make this suggestion to young men: When you find something to criticize in business, don’t go to Congress to have it corrected. Don’t bother to write to the editor of your newspaper. Go to the offender and tell him how to eliminate the cause of your criticism. If he doesn’t put you on his payroll, and you still think some think should be done, see if you can’t figure out a way to get into business with your idea. That’s how most good things get started, and that’s how money is made—by doing something better than the other man.
WILLIAM FEATHER, The William Feather Magazine March, 1964
Paul L. Poirot
Paul L. Poirot was a long-time member of the staff of the Foundation for Economic Education and editor of its journal, The Freeman, from 1956 to 1987.