Progressive Wednesday

The Nitty-Gritty from the Twin Cities: Shortest Social Security Article Ever

May 1st, 2007 by Jon Slock

Social Security was not founded as a retirement program. It was a New Deal program meant to fight poverty.

Back in the day, people worked until they couldn’t work any more (read: frail, sick, dead, etc.). Most (if any) had no pension, and the idea of saving for retirement didn’t exist at that point, so the elderly were often in dire straits. Indeed, the official name of the Social Security program is OASDI: Old Age, Survivors, and Disability Insurance.

This is an important distinction. Because if you see Social Security as merely a retirement account, then it becomes tempting to say that it’s not doing the job compared to other options. However, if you recognize that it’s a safety net on a number of fronts– payments to the disabled, widows, orphaned children, as well as a source of modest retirement income to keep people out of poverty — then it gets a bit harder to argue about dismantling it, either outright or through Trojan Horses like “private accounts.”

One other thing, though, regarding private accounts: we already have them. They’re called Individual Retirement Accounts (IRAs); they’re optional, and a great way to put money away on a tax-advantaged basis. So, if you want private accounts, fund your IRA. If you want to dismantle Social Security, at least have the gumption to say it, and don’t pretend you’re “reforming” it.