Nov 4, 2013

"You Can't Change The Rules"

     Older Americans really, really don't like the idea of changing Social Security. However, removing the cap on wages covered by the F.I.C.A. tax does appeal to them.
"I contributed to it. It's my money," said Joan McDonald, 65, of Annapolis, Md., who retired as an accountant this year and began collecting Social Security. "The plan was, 'Contribute this and you get this.' You can't change the rules."


Anonymous said...

"you can't change the rules"

That's the silliest argument i've ever heard. The people that make the laws/rules are democractically elected and are actually our representatives.

When people say "you" they are's actually them. If someone doesn't like the law, campaign to change it, but don't point a finger like it's someone else's fault.

Also, I could make the same argument about raising taxes. I've planned my monthly spending based on 6.2% FICA, how is it fair to change the rules and all of a sudden tax me at a higher rate?

Anonymous said...

Good point. I agree whole the argument is silly. NOT CHANGING the programs over the years with the modern workforce is in part the cause of dome of this mess.

Anonymous said...


When any politician tells you we have to take steps now in order to shore up S.S. for the future: They are LYING.

What they are concerned about is this: S.S. has had cash shortfalls averaging 50B per year over the past few years. According to the SSA, these shortfalls will continue and increase.

These shortfalls are associated with the beginnings of the baby boom retirements and other factors, and are NO SURPRISE. Just like the baby boomers are no surprise.

The problem is that the feds have acted with criminal recklessness in borrowing and spending the trust fund on other things. Now that the well forecast shortfalls have arrived, the trust fund money is not available to deal with it. So they plan to cut benefits to end the shortfalls and achieve a money in equals money out balance. If this continues, the trust fund is NEVER REPAID. That is the feds goal.

Cuts have yet to happen, but if they do, even while Americans are owed $2.8 trillion, they are committing CRIMES.

So any time a politician says we have ti make changes NOW to deal with a problems twenty years in the future


Anonymous said...

The fact that workers contribute to the Social Security program's funding through a dedicated payroll tax establishes a unique connection between those tax payments and future benefits. More so than general federal income taxes can be said to establish "rights" to certain government services. This is often expressed in the idea that Social Security benefits are "an earned right." This is true enough in a moral and political sense. But like all federal entitlement programs, Congress can change the rules regarding eligibility--and it has done so many times over the years. The rules can be made more generous, or they can be made more restrictive. Benefits which are granted at one time can be withdrawn, as for example with student benefits, which were substantially scaled-back in the 1983 Amendments.

There has been a temptation throughout the program's history for some people to suppose that their FICA payroll taxes entitle them to a benefit in a legal, contractual sense. That is to say, if a person makes FICA contributions over a number of years, Congress cannot, according to this reasoning, change the rules in such a way that deprives a contributor of a promised future benefit. Under this reasoning, benefits under Social Security could probably only be increased, never decreased, if the Act could be amended at all. Congress clearly had no such limitation in mind when crafting the law. Section 1104 of the 1935 Act, entitled "RESERVATION OF POWER," specifically said: "The right to alter, amend, or repeal any provision of this Act is hereby reserved to the Congress." Even so, some have thought that this reservation was in some way unconstitutional. This is the issue finally settled by Flemming v. Nestor.

In this 1960 Supreme Court decision Nestor's denial of benefits was upheld even though he had contributed to the program for 19 years and was already receiving benefits. Under a 1954 law, Social Security benefits were denied to persons deported for, among other things, having been a member of the Communist party. Accordingly, Mr. Nestor's benefits were terminated. He appealed the termination arguing, among other claims, that promised Social Security benefits were a contract and that Congress could not renege on that contract. In its ruling, the Court rejected this argument and established the principle that entitlement to Social Security benefits is not contractual right.

Anonymous said...

The question that must be answered is why must the rules be changed? Is this an unpredicted actuarial need? This may come because of changes in birth rates, improvements in health care, changes in immigration and the demographics of immigration, the effects of war and disease in death rates, etc. Some of these effects are factored in to some degree and understandable changes are made and easily and clearly explained. However, when political policies start to go off the rails, then problems occur. Using the trust funds as a piggy bank for wars & domestic/international welfare funds is a path to destruction of a resource that was designed to provide an economic earned right. But we have learned that such rights are a low priority compared to politicians acting to build their power base via class envy and control and adding to that base as a result of loosely enforced immigration policies. How would you feel if you timely made your monthly home mortgage payments for 30 years and were now ready to enjoy the ownership benefits of your paid for house, only to be told by your bank "Not so fast! You still must continue to pay to help your neighbors pay their mortgage and also subsidize the rent for the immigrants who just moved in down the street. Your mortgage agreement is just a scrap of paper."

Anonymous said...

If we keep electing liberals, I fear that will be the new "social" norm!

Anonymous said...

I knew this would rankle some hard core right wingers. But I think this article hits the solution for the SS program.

Let's raise what can be taxed from $113,700. How much? Not sure. But I wonder if we raise to say just $120,000 or $130,000 how much funding problems would go away. I would probably say a lot.

This is the age old battle between rich people not wanting their money going to perceived poorer people. But I wonder those above who are SOOO against any type of changes in Social Security that might raise taxes are actually drawing SS. I would expect probably none.

If they were, they would be fighting to keep what they put into the program. Hypocritical. Tell me I'm wrong.

Anonymous said...

6:08 PM You are wrong. So wrong. Wrong in more ways than you can imagine. Wrong beyond any teachable moment.

Anonymous said...

To 12:50. What exactly am I wrong?

You are telling me you would not draw on Social Security if you meet the age requirements and/or the disability requirements. You would and you know it.