The AARP and Young Americans

On Neal Boortz's syndicated radio talk show, he is warning listeners about how the young in America will be the ones getting the short end of the stick if the Social Securty system is not reformed. Now he is what he has to say about this.

It is a cause of dismay, if not outright sadness. Young people, by and large, just can't seem to get worked up about matters political. That's too bad, because they might be interested in knowing that one of America's largest and most effective lobbying organizations has just declared war on them.

The AARP has now decided that it's going to fight any effort by President Bush to privatize, even partially, that debacle known as Social Security. If younger Americans had any idea what was happening to them here they would demanding change. If young Americans truly had a handle on the future, and on the fact that they will one day reach that magic age when they stop working and live on their retirement income, they would be marching on DC and occupying congressional offices until change was made.

Sadly, these young Americans who are getting so royally screwed by Social Security and the AARP are far more concerned with sports, pop culture and who they're going to 'hook up" with this weekend.

The time will come, though, when these people who today are preoccupied with the grossly unimportant will suddenly realize that they've been robbed blind. For their entire working lives they had 14% of their earnings ripped off as a Social Security "contribution." In time they will find out that if they are actually lucky enough to get any of this money back when they reach the age of about 70 or so, they will have realized a return of less than 2% on their "investment.'

Social Security is running out of money.

Depending on who you listen to, in about 15 to 18 years Social Security taxes will not be sufficient to pay the Social Security benefits to the people then receiving them. At this point the government will have only a few options. Here are the choices:

1. Extend the retirement age in hopes that many more Americans will actually do the government the favor of dying before they can collect any or all of their benefits.

2. Deny Social Security benefits to those who worked hard and made good financial decisions in their lives, thereby insuring themselves a sufficient retirement income outside of Social Security. No ... their "contributions" will not be refunded

3. Extend the wage base for taxes so that achievement-oriented Americans can poor even more money into this financial sewer; more money that they will never, ever get back.

You do know, don't you, that there is absolutely no legal guarantee that you will receive one single penny of the money that is taken from you. No guarantee at all. The congress can vote tomorrow to end the system and keep every dollar that has been paid in Social Security taxes. There would be nothing you could do about it. Nothing except, that is, to vote against the jerk who stole your money. All your local politician would have to do is come up with a little pork for the district or state and everything would be forgiven.

And just which group of Americans is hurt the most by Social Security? Black males. If you're a black male this is the ultimate "disrespect." You're being ripped off big time.

Explanation: Divide the people who have been paying Social Security taxes for the past 40 years into four basic groups. White Males, black males, white females, black females. Statistics will show that of these four demographic groups white females have the longest life expectancy; black males the shortest. In 2002 the life expectancy for a newborn white female was 79.9 years. The life expectancy of a newborn black male was 68.8 years. If you were born after 1960 your Social Security full retirement age is 67. This means that a black male can expect to get Social Security benefits for about two years, while a white female can expect to receive those benefits for almost 13 years. You do the math. even if you went to a government school you can figure out that the average white female will receive Social Security benefits 11 years longer than the average black male. It has been estimated that during his lifetime the average black male will lose about $10,000 in income that will be forcibly transferred to a white woman.

The solution? Privatization! If you own your own account it can't be taken from you or your family and given to some stranger living in a retirement community in Palm Desert, California. If you have the misfortune to die before the law allows you to start withdrawing retirement benefits from your account the money goes to your family. Isn't that the way you would want it? Wouldn't you want that money to be spent to make your spouse or children rather than someone you didn't know and who might not have even given you the time of day if you had known them during life?

This is absurd, folks. We're supposed to be living in free country that recognizes property rights. You own you, not the government. You work for you, not for some stranger. In a free country your government should not seize your money by force and put it into a phony "retirement" fund that earns you a sub-par rate of return and to which you have no legal right beyond what politicians are willing to grant. When you die the money you earned during life shouldn't be seized by government to be transferred to another individual you don't know while your family scrambles about looking for a way to keep their home and pay for your funeral, but that's exactly what the AARP is fighting for.

You do know what happened in Chile, don't you? Chile, for God's sake! They got it right!

Chile used to have a Social Security system that was a virtual copy of ours. Chile, however, didn't have an AARP. What Chile did have was politicians who realized that their system was doomed to collapse, and who did something about it. Chile privatized every individual's retirement benefits. The former Chilean secretary of labor says that Chile first "ended the illusion that both the employer and the worker contribute to retirement." That's a huge step. The dumb masses in America still actually believe that their employers actually "contribute" a matching amount to their Social Security "account." It's those government schools again.

Americans even believe that there's actually a Social Security trust fund. Yesterday's USA Today story about the AARP's opposition to privatization contained this line: "Excess payroll taxes are held in a trust fund for future benefit payments." That's just flat-out wrong. USA Today reporter Jim Drinkard either knows it's wrong, and lied intentionally, or he's not bright enough to be writing for a national newspaper. There is no Social Security money being held anywhere. It's all spent. Every single penny. What the politicians don't have to spend on current Social Security benefits they seize and spend on their various spend-and-elect schemes.

Today in Chile workers pay 10% of their pretax earnings into their own retirement plans. They can elect to pay an additional 10% in pretax earnings if they wish. The companies who manage these funds are prohibited by law from engaging in any other type of business. The sole business purpose of these companies is to take these privately owned retirement accounts and grow them. If they die before the retirement age the money goes to their families. If Chileans live to retirement age they have three options:

1. Purchase a family annuity from a life insurance company.

2. Leave their funds in a personal account and make monthly withdrawals adjusted to match their life expectancy.

3. Any combination of 1 and 2.

The government steps in to guarantee a "minimum pension" for people who have worked at least 20 years and who's benefits don't meet the minimum monthly amount required by the Chilean law.

In Chile 95% of workers participate in the private plan. In America 100% of workers don't have that option, and the AARP is doing everything it can to make sure they never do.

Thanks, AARP. If younger Americans ever figure out what an enemy to their financial future you truly are things may change and you may lose that grip you have on government.

http://boortz.com