Social Insecurity: It’s Not Wrong to be Concerned about Facts

By Karl Streitel – 02/07/2024

A December 19, 2023, article by Brett Arends on MarketWatch caught my eye with the oh-so-clickable title of “This Is the Scariest Number for Social Security.” Given the fact that many corporate media articles today focus on pointing out to the rubes how their senses are wrong and, gosh golly, everything is just peachy, it did not shock me to learn that Mr. Arends was not referring to the program’s unfunded liabilities or the projected depletion of the trust fund. No, Mr. Arends contends that the real problem is the dragooned citizens who foolishly worry about Social Security’s solvency—and the “quiet effort” to rabble-rouse:

The scariest number may be 71%. That astonishing figure, from a new poll, is how many have been persuaded that cuts to Social Security—potentially deep cuts—are either likely or inevitable. And that wasn’t from a biased poll conducted by a pressure group. Or a fly-by-night poll by a startup. It came from a comprehensive survey of 10,000 people conducted by the Harris Poll on behalf of the respected Transamerica Center for Retirement Studies. . . .

Score another victory for the Resistance Is Futile campaign—the quiet effort to persuade Americans to accept cuts to Social Security that they don’t want, and that the program doesn’t need.

If our national-pension poachers get their way, it will be because of this.

Mr. Arends then argues that “none of this is remotely needed. It’s pure spin.” His evidence? America is richer than ever, “billionaire boondoggles” can be eliminated in the tax code, and the valiant Internal Revenue Service (IRS) can catch more tax “cheats” to the tune of an estimated $700 billion per year.

However, Mr. Arends’s arguments here do not prove that Americans are foolish to worry about Social Security’s health and whether cuts are likely. Let’s say I’m out walking and see a car careening toward me. Initially, I worry for my life but then remember that the driver has all sorts of possible options for not killing me; thus, it’s silly for me to continue to worry because obviously one of those options will come to pass, right?

Reality Bites

However, in reality, the Social Security program is facing substantial problems, and these problems are mounting each year. To wit, the non-fly-by-night-startup 2023 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds (more commonly referred to as Social Security and disability insurance) discusses the current path of fund depletion and potential benefit reductions: “Under the Trustees’ intermediate assumptions, OASDI cost is projected to exceed total income in 2023, and the dollar level of the hypothetical combined trust fund reserves declines until reserves become depleted in 2034, one year earlier than projected in last year’s report” (emphasis added).

The report then mentions what would be needed to keep the fund solvent over the next seventy-five years:

(1) Revenue would have to increase by an amount equivalent to an immediate and permanent payroll tax rate increase of 3.44 percentage points to 15.84 percent beginning in January 2023; (2) scheduled benefits would have to be reduced by an amount equivalent to an immediate and permanent reduction of 21.3 percent applied to all current and future beneficiaries effective in January 2023, or 25.4 percent if the reductions were applied only to those who become initially eligible for benefits in 2023 or later; or (3) some combination of these approaches would have to be adopted. (emphasis added)

Thus, not only is the trust fund expected to be depleted in 2034—at which point benefits would need to be reduced if no changes are made to the program in the interim—but also that this date is earlier than expected last year. Further, the report notes that the total projected unfunded liability over the next seventy-five years had also increased since last year’s projection—not exactly rosy pictures for current and future beneficiaries.

This is not speculation based on hoping for future changes; this is a fact-based projection founded on current reality and assuming no changes to the program—which is a fiscally prudent approach to projections. If I see that my income will pay for only 80 percent of my lifestyle in ten years but then wave that issue away by saying that, obviously, I’ll make some changes before that happens, I doubt anyone would think my “planning” is particularly sensible (especially if I have a history of not making any such changes despite similar projections).

It thus seems odd to me that Mr. Arends wants to paint those concerned about Social Security’s solvency as somehow manipulated by the “quiet effort” of people hell-bent on taking away Social Security when the current facts indicate those concerned people are exactly right—their benefits are scheduled to be reduced in 2034, barring any changes. Even the Social Security Administration says so. You may argue that it is obvious that solutions exist to improve the program’s fiscal health before that date, but then you are engaging in “spin” and assuming future actions that may or may not come to pass. The people polled, however, seem to have fears backed by the current state of facts, which does not seem unreasonable at all to me.

The True Manipulation

At the end of the article, Mr. Arends concludes that “the battle lines are drawn: Make the political donor class pay taxes, or steal pensions from middle-class retirees,” but this statement itself epitomizes manipulative, fact-free language.

For one, the “political donor class”—by which Mr. Arends means billionaires—certainly pays taxes. According to the ProPublica investigation into the leaked IRS records from 2014 to 2018, the top four hundred income earners (those earning over $110 million per year) paid an effective tax rate of 22 percent while the top twenty-five richest Americans paid “a total of $13.6 billion in federal income taxes” (or $2.72 billion per year).

Given that the projected deficit in Social Security over the next ten years is $2.572 trillion, even if we expropriated one hundred times more in taxes from the twenty-five richest Americans over those years, we would only just barely cover that projected deficit—which is also increasing in magnitude each year.

The article also explains that the main reasons those in the top four hundred paid an effective rate lower than the highest marginal tax rate (37 percent) were that much of their income came from investments—which are taxed at a maximum of 20 percent for long-term gains and qualified dividends—and that they took large deductions, often for charitable contributions. Both of these reasons are legal and do not amount to not paying taxes any more than most people who take deductions for paid real estate taxes or for children or for business mileage amounts.

We can certainly argue over the tax rates and deductions (although I fail to see how donating to charity is a loathsome idea), but claiming that we need to make billionaires “pay taxes” ignores reality once again.

Furthermore, the idea that reducing Social Security benefits amounts to “steal[ing] pensions from middle-class retirees” is also a fiction. For one, no one is stealing anything from retirees if benefits are reduced. This is because Social Security benefits are not a contractual obligation or a “right.” According to the Supreme Court in Fleming v. Nestor in 1960:

To engraft upon the Social Security system a concept of “accrued property rights” would deprive it of the flexibility and boldness in adjustment to ever changing conditions which it demands. . . . It is apparent that the non‐​contractual interest of an employee covered by the [Social Security] Act cannot be soundly analogized to that of the holder of an annuity, whose right to benefits is bottomed on his contractual premium payments. (emphasis added)

Thus, Social Security benefits are always allotted and paid according to the caprices of Congresspeople, who can change the system at any time and in any way they like (or can get away with). We may feel like we are “owed” benefits, but, again, reality disagrees.

Social Security benefits are also paid mainly via payroll taxes levied on current workers, so if there is any theft going on, it is actually from current workers and by current beneficiaries (via politicians). One common myth about the program is that “you’re owed” what you paid in, as if that money goes into a personal account for you. Quite the opposite: the money paid into the program is spent on current beneficiaries, which means that when current workers eventually take Social Security, they will be taking money coercively from their own children and grandchildren to support themselves. In truth, Social Security—like all taxpayer-funded benefits programs—digs itself a deeper hole each year, and the only true solution is to phase out the program entirely and allow people to be responsible for their own retirements instead of being subject to the whims of Congress or the confiscatory ideas of Mr. Arends.

Karl Streitel is a freelance editor and writer and former English and finance teacher. He writes about voluntaryism, politics, and education at and can be reached at

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