Former Democratic vice-presidential contender Geraldine Ferraro inadvertently revealed the real reason behind Democrats' resistance to the president's proposal of Social Security partial privatization. " . . . [I]f you don't have the knowledge [emphasis added] and the wherewithal [emphasis added] to manage your own private funds," said Ferraro, "well, you know, you're gonna be out of luck."
Now, Americans possess the ability to make the money. Ferraro's comments parallel the Americans-are-too-stupid theme embraced by former President Bill Clinton. Speaking in 1999 about the $70 billion budget surplus, Clinton said, "We could give it all back to you and hope you spend it right. . . . Do you really want to run the risk of squandering this surplus?"
Congress never intended for Social Security to grow into something on which people solely relied for their retirement. Even its patriarch, Franklin Delano Roosevelt, said, "We shall make the most lasting progress if we recognize that Social Security can furnish only a base upon which each one of our citizens may build his individual security through his own individual efforts." But decade after decade, both Republicans and Democrats kept adding to the program, making it increasingly more generous, much to the delight of the ever-motivated older voter.
The Social Security "trust fund" doesn't consist of any real assets. The government "borrows" fund money for other federal spending, replacing it with IOUs. The remainder of the "trust fund" is merely accounting entries attributing interest to the IOUs. Thus, current workers paying in support current retirees drawing out. According to the Social Security Administration, in 1945, 41.9 workers supported each individual retiree, while today only 3.3 workers support each retiree. This system cannot continue.
Now Democrats say, "What crisis?" Senate Democratic Leader Harry Reid, D-Nev., recently said, "For heaven's sakes, they're crying wolf a little too regularly here. There is not an emergency on Social Security."