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« The Louisiana Libertarian Lives. | WILLisms.com | Quotational Therapy: Part 43 -- Huey P. Long, Socialist. »

Social Security Reform Thursday: Week Thirty-Two -- Dependency and Social Security.


Thursdays are good days for reform, because they fall between Wednesdays and Fridays. And reform is a long-haul process, not a fleeting event.

That's why WILLisms.com offers a chart or graph, every Thursday, pertinent to Social Security reform.

This week's topic:

Dependence On Social Security.

In the aftermath of Hurricane Katrina, it quickly became evident that hundreds of thousands of Americans would be completely at the mercy of other Americans, and wholly dependent on the aid of strangers, for a long time.

But just how many people were already dependent on government for their every need before Hurricane Katrina?


Subsidized or public housing, public transportation, public schools, and public assistance for food and clothing and medicine. The works. But how many folks were dependent on a Social Security check for nearly their entire retirement benefit?


And in the aftermath of Hurricane Katrina, the United States Postal Service and the Social Security administration are scrambling to deliver benefit checks to displaced individuals:

In the days since the storm moved through, officials have handed out about 10,000 Social Security checks in Mississippi and 5,000 in Louisiana....

...for some 720,000 customers around New Orleans deliveries are not possible.

In Mississippi alone, approximately 100,000 people in Mississippi are still unable to get mail.

A nightmare. Many people who are now temporarily dependent on government (and churches and individuals and corporations and charities, etc.) for everything, were already dependent on government for nearly everything.


For one out of five Americans over the age of 65, Social Security is the only source of income. For one out of three, it is the source of about 90% or more of income. And nearly 2/3 of "chronologically enhanced" Americans depend on Social Security for more than half of their income.

That is astoundingly high.

It's no wonder a relatively high poverty rate persists for elderly minorities, in particular:


Near poor, in the above chart, refers to those between 100% and 125% of the poverty line. Women are particularly hard hit, as are African-Americans and Latinos.

So many of the evacuees from New Orleans were already poverty-stricken, living day-to-day, week-to-week, and month-to-month, depending on Uncle Sam for food, clothing, shelter, and medicine, just to name the necessities.

In some ways, it was an entirely rational decision to STAY PUT, even in the path of the hurricane. Why expend resources to get out of town, possibly for a false alarm or a measly Category 1 or 2 storm, when the Social Security check comes in the mail in just a couple of days?

And today, we see the mad scramble to divert Social Security checks to the proper individuals in the Astrodome and elsewhere scattered around the country. If that is their only source of income, they need those checks.

And this also explains why older Americans are so reluctant to reform Social Security. They worry they may not get their checks.

No checks, no money. No money, no necessities of life.

Now, imagine if FDR had set up a Social Security system with personal accounts, instead of the failed pay-as-you-go pyramid scheme system of funding we have today. Or even some sort of hybrid system. Anything but the way it is done now.

Not only would some of those elderly evacuees now have something in the form of assets to get them through this disaster and help them start a new life elsewhere, many of them would not have depended so exclusively on the government for aid, living from benefit check to benefit check, BEFORE Katrina even hit.

That's what Social Security reform is all about. Empowering individuals. Giving people a chance to grow assets that belong to them, not theoretical benefits that trickle in through the mail each month. Breaking the cycle of dependence on month-by-month checks from the government. And giving people the chance to pass the fruits of their lifetimes of labor onto their children and their children's children.

African-American communities would benefit disproportionately more than nearly any other group from Social Security reform with personal accounts. Today, according to the Cato Institute, the typical black household has 10% the level of assets (net worth) the typical white household has (.pdf) Social Security reform would certainly narrow that gap. Furthermore, African-Americans on average get a much poorer return on their Social Security contributions than whites, because of shorter life-expectancy rates. Indeed, many blacks see a negative rate of return on their lifetime of contributions.

One reason many anti-reform types often give for opposing modernization of Social Security is that it works so well, as-is, to eliminate poverty.



No it doesn't. Social Security is, as-is, a failure. Over the years, Social Security has mitigated some poverty, to be sure, but at the same time, it robbed each and every working American of the opportunity to earn compound interest in personal "lockbox" account. And it has fed into the cycle of dependency for the poorest Americans.

And in the coming years, without reform, Social Security will leave even more individuals in poverty than it does today.

In the future, if America is to remain on top of the world, economically, we must empower individuals. It is time to give all Americans a hand up, rather than a modest monthly handout. We must reform Social Security.

The clock is ticking.


Previous Reform Thursday graphics can be seen here:

-Week One (Costs Exceed Revenues).
-Week Two (Social Security Can't Pay Promised Benefits).
-Week Three (Americans Getting Older).
-Week Three, bonus (The Templeton Curve).
-Week Four (Fewer Workers, More Retirees).
-Week Five (History of Payroll Tax Base Increases).
-Week Six (Seniors Living Longer).
-Week Six, bonus (Less Workers, More Beneficiaries).
-Week Seven (History of Payroll Tax Increases).
-Week Seven, bonus (Personal Accounts Do Achieve Solvency).
-Week Eight (Forty Year Trend Of Increasing Mandatory Spending).
-Week Nine (Diminishing Benefits Sans Reform).
-Week Ten (Elderly Dependence On Social Security).
-Week Eleven (Entitlement Spending Eating The Budget).
-Week Twelve (Benefit Comparison, Bush's Plan versus No Plan).
-Week Thirteen (Younger Americans and Lifecycle Funds).
-Week Fourteen (The Thrift Savings Plan).
-Week Fifteen (Understanding Progressive Indexing).
-Week Sixteen (The Graying of America).
-Week Seventeen (Debunking Myths).
-Week Eighteen (Debunking Myths).
-Week Nineteen (Reform Needed Sooner Rather Than Later).
-Week Twenty (Global Success With Personal Accounts).
-Week Twenty-One (GROW Accounts: Stopping The Raid).
-Week Twenty-Two (Millions of Lockboxes).
-Week Twenty-Three (Support for Ryan-DeMint).
-Week Twenty-Four (KidSave Accounts).
-Week Twenty-Five (Latinos and Social Security).
-Week Twenty-Six (AmeriSave).
-Week Twenty-Seven (Cost Of Doing Nothing).
-Week Twenty-Eight (Chile).
-Week Twenty-Nine (Entitlement Spending Out Of Control).
-Week Thirty (Reform Better Deal Than Status Quo).
-Week Thirty-One (Social Security As A Labor Cost).

Tune into WILLisms.com each Thursday for more important graphical data supporting Social Security reform.

Posted by Will Franklin · 8 September 2005 10:59 PM


It was almost Reform Friday!... You have spoiled us for a good while now...Once again reform "Thursday" rocks at WILLisms.com!...

Posted by: Zsa Zsa at September 9, 2005 06:36 AM

BZZZZZT!... I like that...

Posted by: Zsa Zsa at September 10, 2005 03:56 PM