My maternal grandfather was a farmer and would proudly take his vegetables and produce into town to sell at the farmers' market. He was often successful in getting a respectable return on his sweat equity, which would allow him to support his family and plan for the next growing season.
Even though my grandfather was the grandson of slaves, he was able to own his small farm, own his crops and own the modest return as the fruits of his labor.
Our Founding Fathers envisioned a society that valued and rewarded ownership and individual achievement. Ownership is as much an unalienable right as life, liberty and the pursuit of happiness, because they are all endowed by our Creator. Just as the pursuit of happiness is not possible without liberty, liberty is not possible without ownership of one's time, talent and treasure. To argue otherwise would be illogical.
President Bush's vision of an ownership society is the same as that of our Founding Fathers, our grandparents and our parents. The centerpiece of Bush's vision is to restructure the soon-insolvent Social Security structure and instill a greater degree of fairness for all citizens in the outdated income tax code.
When Social Security was enacted in 1935, each worker was taxed 3% on the first $3,000 of income. A brochure describing the new program issued by the then-Social Security Board stated, "That is the most you will ever have to pay." Today we are taxed at a rate of 12.4% on the first $90,000 of income.
According to the latest projections by the Social Security trustees, benefits paid to retirees will exceed payroll taxes collected by 2017. If members of Congress do not act now to restructure the system as the President has proposed, which is very similar to two bills already introduced in the Senate, they will have no choice but to cut benefits and raise taxes again.
But congressional Democrats attack the President's vision daily. They believe it is right for citizens to continue to receive a negative return on their lifelong contributions to the Social Security system, and in many instances no return at all. The return on contributions is even worse for black people, because of the difference in their average life expectancy.
These same Democrats do not want to replace the outdated tax code. They do nothing but place party partisanship over what is best for the country, because they want to continue to deny people more control of their money.
When the tax code was enacted in 1913 it taxed a small percentage of the working population a few simple percentage points of their income. Today, no one escapes the complexity and inherent unfairness of the tax code except those who cheat or deal in illegal activities. Millions of honest citizens pay more than one-third of their income in federal taxes, and their estate is hit with another huge tax bill when they die.
The evidence is compelling that ownership encourages people to work, save and invest for their own retirement. The Galveston County, Texas, municipal employees are laughing all the way to the bank when they retire, because many of them have earned two to four times what a person on Social Security would receive for the same lifetime contributions.
The small country of Chile switched to an optional system of personal retirement accounts in 1980 and workers are retiring at 80% of their pre-retirement income. Social Security recipients in the U.S. on average receive about 40% of their pre-retirement income, and they do not own their contributions or benefits after their death. In Galveston County and Chile, your money is yours to keep or pass on to heirs.
Pursuit of Happiness
The 70-year-old Social Security structure and the 92-year-old income tax code thwart the natural, individual motivation of citizens to use their God-given talents to pursue happiness and their respective dreams. Any program that undermines an individual's liberty to create ownership is, then, by its very nature, immoral. It took our nation nearly 250 years to end slavery and live up to the self-evident truth that all men are created equal. It should not take us another 250 years to cease the involuntary negative return most working people receive from Social Security, or the involuntary servitude imposed by the oppressive income tax code.
Congress does not lack the skill to fix these big problems. It lacks the will . Too many members of Congress will not follow the President's lead toward an ownership society nor will they get out of the way. Even worse, they offer no alternatives except higher taxes and lower benefits for the Social Security system, more complexity and less efficiency for the income tax code, and divisive rhetoric that pits grandparents against their grandchildren. They are trading the next generation for the next election.
One of the greatest events in the annals of human history--the declaration and fight for independence by a visionary group of American colonists against a tyrannical king--was motivated by a faith in God and a faith in the ability of the individual to determine his own destiny.
Ownership lets people realize their dreams and opportunities and is the key to the greatest nation on earth remaining the greatest nation. We have a moral obligation to protect our Founding Fathers' vision and to protect the unalienable right of ownership for our grandchildren.
It's our unalienable responsibility.Herman Cain is chief executive officer of T.H.E. New Voice, Inc. and New Voters Alliance, and host of the nationally syndicated radio talk show The Bottom Line with Herman Cain. He is past chairman of the Federal Reserve Bank of Kansas City, and past chairman and CEO of the National Restaurant Association.