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If the government decided to make Social Security a private corporation it could. If it did this, keeping in place Social Security “taxes” that would then go t

If the government decided to make Social Security a private corporation it could. If it did this, keeping in place Social Security “taxes” that would then go to the new corporation, we would not consider Social Security a budget expense. Being government owned or private doesn’t matter in terms of how the expenditures should be considered. This is why Social Security and Medicare are not part of the normal budget negotiations at budget time. These are obligations that need to be paid to the people who paid for them.

JumpCrisscross 2y ago
> If the government decided to make Social Security a private corporation it could No, it couldn’t. There were promises made with the full faith and credit of the United Stares. > obligations that need to be paid to the people who paid for them Everyone pays taxes. Social Security and Medicare obligations are treated differently because of politics. Otherwise, they’re like any other expense: the Congress can amend them at will. (As is currently expected, e.g. with Social Security benefits beginning to be curtailed from 2035.)
- jltsiren 2y ago
  I agree on Medicare. But it's plausible that the Supreme Court could find government meddling on Social Security unconstitutional, because similar decisions have already been made in other countries. In Finland, the mandatory pension system is similar to Social Security, except that it aims to replace ~60% of earned income without any limits. Pensions based on past contributions have been established as constitutionally protected private property. If the system seems to be out of balance, the basic tools are raising the contribution rates without increasing the benefits and increasing the retirement age for younger generations. Any changes that would substantially lower the pensions that have already been earned would have to go through the same process as constitutional amendments. (There is also a third tool: increasing the tax rates for all retirement income, regardless of the source. But that is understandably unpopular.)
  - kelnos 2y ago
    > But it's plausible that the Supreme Court could find government meddling on Social Security unconstitutional, because similar decisions have already been made in other countries. I sincerely hope SCOTUS doesn't care at all about similar decisions made in other countries. What is or is not constitutional in the US should be based solely on the US constitution.
- skhunted 2y ago
  > If the government decided to make Social Security a private corporation it could No, it couldn’t. There were promises made with the full faith and credit of the United Stares. I'm not a lawyer so I'll rephrase. In an alternate universe the U.S. government created a corporation to run Social Security. It mandated that people participate in it. Everyone called it a pension system because that it what it is. Congress can amend them at will. All pension systems are subject to amendment. Many pension systems have been amended over the years.
  - JumpCrisscross 2y ago
    > In an alternate universe the U.S. government created a corporation to run Social Security. It mandated that people participate in it. Everyone called it a pension system because that it what it is If the U.S. then explicitly guaranteed that corporation's liabilities, sure. > All pension systems are subject to amendment. Many pension systems have been amended over the years No. Many state legislatures, for instance, are constitutionally prohibited from fucking with certain obligations, commonly pensions.
    - blackeyeblitzar 2y ago
      > Many state legislatures, for instance, are constitutionally prohibited from fucking with certain obligations, commonly pensions. Which is a serious problem. The entire idea of a truly guaranteed pension is not feasible and always leads to a pyramid scheme and then insolvency.
      - JumpCrisscross 2y ago
        > entire idea of a truly guaranteed pension is not feasible and always leads to a pyramid scheme and then insolvency Sure. But the point of full faith and credit is it's irreversible. (Actually, the point of credit, period. You can't declare your past debts pyramid schemes and unilaterally absolve yourself of them.)
        science4sail 2y ago
analog31 2y ago
They're not part of negotiations because there was such a backlash during the Reagan era. Part of his campaign platform was to reel in the entitlements. Then he discovered that people like their entitlements. George Bush tried to privatize Social Security, and the idea went nowhere in a hurry. The value of Social Security is the expectation that it will be bailed out by the government if it goes bust, for instance if the trust fund is depleted.
- skhunted 2y ago
  You do not understand how this all works. Social Security "spending" does not add to the deficit. It is not the source of any budgetary imbalances or of any structural budgetary issues in the United States. It is a pension system that is funded by workers that happens to be run by the government.

JumpCrisscross 2y ago

> If the government decided to make Social Security a private corporation it could No, it couldn’t. There were promises made with the full faith and credit of the United Stares. > obligations that need to be paid to the people who paid for them Everyone pays taxes. Social Security and Medicare obligations are treated differently because of politics. Otherwise, they’re like any other expense: the Congress can amend them at will. (As is currently expected, e.g. with Social Security benefits beginning to be curtailed from 2035.)

jltsiren 2y ago
I agree on Medicare. But it's plausible that the Supreme Court could find government meddling on Social Security unconstitutional, because similar decisions have already been made in other countries. In Finland, the mandatory pension system is similar to Social Security, except that it aims to replace ~60% of earned income without any limits. Pensions based on past contributions have been established as constitutionally protected private property. If the system seems to be out of balance, the basic tools are raising the contribution rates without increasing the benefits and increasing the retirement age for younger generations. Any changes that would substantially lower the pensions that have already been earned would have to go through the same process as constitutional amendments. (There is also a third tool: increasing the tax rates for all retirement income, regardless of the source. But that is understandably unpopular.)
- kelnos 2y ago
  > But it's plausible that the Supreme Court could find government meddling on Social Security unconstitutional, because similar decisions have already been made in other countries. I sincerely hope SCOTUS doesn't care at all about similar decisions made in other countries. What is or is not constitutional in the US should be based solely on the US constitution.
skhunted 2y ago
> If the government decided to make Social Security a private corporation it could No, it couldn’t. There were promises made with the full faith and credit of the United Stares. I'm not a lawyer so I'll rephrase. In an alternate universe the U.S. government created a corporation to run Social Security. It mandated that people participate in it. Everyone called it a pension system because that it what it is. Congress can amend them at will. All pension systems are subject to amendment. Many pension systems have been amended over the years.
- JumpCrisscross 2y ago
  > In an alternate universe the U.S. government created a corporation to run Social Security. It mandated that people participate in it. Everyone called it a pension system because that it what it is If the U.S. then explicitly guaranteed that corporation's liabilities, sure. > All pension systems are subject to amendment. Many pension systems have been amended over the years No. Many state legislatures, for instance, are constitutionally prohibited from fucking with certain obligations, commonly pensions.
  - blackeyeblitzar 2y ago
    > Many state legislatures, for instance, are constitutionally prohibited from fucking with certain obligations, commonly pensions. Which is a serious problem. The entire idea of a truly guaranteed pension is not feasible and always leads to a pyramid scheme and then insolvency.
    - JumpCrisscross 2y ago
      > entire idea of a truly guaranteed pension is not feasible and always leads to a pyramid scheme and then insolvency Sure. But the point of full faith and credit is it's irreversible. (Actually, the point of credit, period. You can't declare your past debts pyramid schemes and unilaterally absolve yourself of them.)
      - science4sail 2y ago

analog31 2y ago

They're not part of negotiations because there was such a backlash during the Reagan era. Part of his campaign platform was to reel in the entitlements. Then he discovered that people like their entitlements. George Bush tried to privatize Social Security, and the idea went nowhere in a hurry. The value of Social Security is the expectation that it will be bailed out by the government if it goes bust, for instance if the trust fund is depleted.

skhunted 2y ago
You do not understand how this all works. Social Security "spending" does not add to the deficit. It is not the source of any budgetary imbalances or of any structural budgetary issues in the United States. It is a pension system that is funded by workers that happens to be run by the government.