Sunday August 5, 2007 Dollars and sense

I STARTED TO WORK PARTTIME IN 1958. I CONTINUED THROUGH HIGH SCHOOL, JUNIOR COLLEGE AND COLLEGE. I STARTED WORKING FULL TIME IN 1963. I RETIRED AT THE BEGINNING OF 2004. I WORKED PART TIME (25 HRS PER WK) FOR 5 YEARS AND FULL TIME FOR 41 YEARS.

IN 1968 WHEN I FIRST WENT INTO SALES, I MADE $160.00 PER WEEK OF WHICH I CLEARED $140.00 PER WEEK. I ALSO RECEIVED $50 PER MONTH CAR ALLOWANCE AND A $1,000 BONUS AT THE END OF THE YEAR.

FOR THAT YEAR, I MADE $9,920 AND CLEARED $8,755.

SINCE THAT TIME INFLATION HAS GONE UP BY 5.987 TIMES, PER THE DEPARTMENT OF LABOR, SO THAT AMOUNT I CLEARED WOULD BE EQUIVALENT TO $52,416 TODAY. AS IT TURNS OUT, THE AMOUNT I MADE INCREASED AS THE YEARS PASSED BY BUT THE AMOUNT I CLEARED ONLY KEPT UP WITH INFLATION (TAXES INCREASED DRAMATICALLY OVER THOSE YEARS). BY THE TIME I RETIRED I MADE $76,870 AND CLEARED $50,990.

SO IN TODAY'S DOLLARS, I AVERAGED CLEARING ABOUT $52,000 PER YEAR. IN TODAY'S DOLLARS, MY AVERAGE CONTRIBUTION (@ 6%) TO SOCIAL SECURITY (INCLUDING THE EMPLOYER'S MATCHING AMOUNT) WOULD HAVE BEEN APPROXIMATELY $8,400 PER YEAR x 46 YEARS = $386,000.

IF THEY HAD PUT THAT AMOUNT INTO CDs AVERAGING 5%, THE PAYOUT EACH YEAR, WITHOUT DRAWING DOWN ON THE PRINCIPAL, WOULD NOW BE $19,000 PER YEAR. I RECEIVE (INCLUDING MY MEDICARE PAYMENT) $18,000 PER YEAR.

THE CONCLUSION IS:
IF THE SOCIAL SECURITY SYSTEM HAD INDEED PUT THE MONEY THAT WAS PAID INTO THE SYSTEM FOR MY ACCOUNT INTO A TRUE TRUST FUND, THERE WOULD HAVE BEEN NO PROBLEM, NO SHORTCOMING, NO DEFICIT. IF THEY HAD PUT THAT MONEY INTO AN IRA IN MY NAME, IT SHOULD HAVE ACTUALLY DONE BETTER THAN 5% GROWTH IF IT WERE HANDLED PROPERLY (A CONSERVATIVE GROWTH FOR THOSE YEARS WOULD HAVE BEEN ABOUT 8 TO 10% GROWTH WHICH WOULD NOW YIELD ABOUT $30,000 TO $38,000 PER YEAR, JUST FROM THE INTEREST.

THE FACT THAT THE GOVERNMENT DID NOT SAVE THE MONEY, DID NOT PAY DOWN THE NATIONAL DEBT, BUT INSTEAD MISMANAGED SOCIAL SECURITY AND MISSPENT THE MONEY ON PET PROJECTS AND BOONDOGGLES AND UNNECESSARY WARS HAS NOW COME BACK TO HAUNT IT. NOW THE GOVERNMENT IS LOOKING TO PASS ALONG THE COSTS OF IT'S MISMANAGMENT TO A YOUNGER GENERATION OR TO PENALIZE THE RETIRED OR SOON TO RETIRE GENERATION. IT ISN'T RIGHT!

I WAS NEVER A HIGH ROLLER. I CONSIDERED MYSELF AVERAGE AND PART OF THE MIDDLE CLASS (SOMEWHAT TO THE LOWER END). I PAID MY TAXES AND CONSIDERED MYSELF A GOOD CITIZEN. I WORKED MY WHOLE LIFE AND NEVER TOOK UNEMPLOYMENT OR WELFARE BENEFITS. I EXPECT MY GOVERNMENT TO HONOR IT'S OBLIGATION TO ME AND TO MAINTAIN MY SOCIAL SECURITY BENEFITS.