Sunday, October 20, 2019

How Elizabeth Warren's Social Security Plan Would Damage the Economy Immediately and Screw the Young When It Comes Time for Them to Receive Social Security Payouts

Elizabeth Warren
By Robert Wenzel

Elizabeth Warren recently released a Social Security plan that would exacerbate many of the program’s existing problems while also creating several new ones, writes Charles Blahous.

The key is to understand that Warren wants to increase payments to current recipients across the board.

Warren has outlined her increases:
  • Increases Social Security benefits immediately by $200 a month — $2,400 a year — for every current and future Social Security beneficiary in America.
  • Updates outdated rules to further increase benefits for lower-income families, women, people with disabilities, public-sector workers, and people of color.
But where is she going to get the money to pay for these increases to: "women, people with disabilities, public-sector workers, and people of color," never mind the $200 increase she wants to give to all retirees (presumably even straight white males)?

Hint: Increase taxes.

In other words, her scheme is a simple transfer of income.

Blahous reports:
The Warren proposal would increase national Social Security tax burdens by roughly 30% relative to current law. Even the Zandi memo issued in support of the proposal recognizes that these tax increases would reduce economic growth by having a “negative impact on the supply of labor.”
And Blahous also informs how it will screw current youth when they reach retirement:
 One of the biggest problems arising under current Social Security law is that it treats younger generations much worse than older ones. Because Social Security is not a savings program but rather an income transfer program, it is a zero-sum game at best: No one can gain net income through Social Security without someone else losing it. The largest such income transfers occur across generations. The trustees’ report shows that unless something is done to moderate the benefit growth rate for current participants, younger generations will lose income through Social Security equal to 3.4% of their career taxable earnings—net of all benefits they receive. The program cannot reasonably provide social insurance for young workers if it is making them more than 3% poorer over the course of their lives. By increasing benefits for today’s participants (including the wealthiest) well beyond what their own future taxes can finance, the Warren plan would substantially worsen the aggregate net income losses of younger generations.
The Warren plan is an economic train wreck. It will slow current economic growth and sets up a scenario where current youth will receive less when they are eligible for payments than what they have been forced to pay in.

Warren is an economy wrecker.




  1. But where is she going to get the money to pay for these increases to: ".......people of color"
    WTF??? You get increases in SS if you are a POC??? BECAUSE you are a POC??? I been checkin the wrong box on the forms.

  2. Robin Hood - I support your ideas.

    1. She has my vote as does anyone else advocating for the people. What we pay into ss over the years has increased on a steady level anyway n repub's want another increase to around 14 0/0 anyway again so ur comment doesn"t hold water.

    2. Anyone who would vote for this crazy woman is lost. Warren has no redeemable qualities. She panders to every group, she knows nothing about economics and has no charisma. So far she has proposed Med for All $5.2 Trillion yr., Free College $1.6 T per yr., universal income $3.3 T per yr. The green new deal $9.3 T per yr. Our current budget is $4.0 T which is what the government takes in in taxes. This comes to $24 trillion per yr. The entire gross domestic product for the US is $20 trillion. Even if Warren confiscated all the wealth of every billionaire in the US it would only come to $3.3 trillion. Not enough to pay for two months. This plan will kill the economy.

  3. Ur article is bs. We as in me n others were raised from 6percent to now 12.5 n republicans are talking abiut raising it again to 13-14percent n more. So ur right leaning comments do not hold water. We can find $$$ for everything else xcept helping the people..well now is the time to do just that and if that comes in the form of eliz warren or another politican who advocates for the people than so B it. Her plan has my vote!!!

    1. So she increases the FICA tax and then goes and spends it on everything else just like before. Standard Illinois politics is to let the roads decay by spending all the tax money motorists pay on everything but keeping the roads up. Then they cry about how there is no money for the roads and raise taxes. Same thing here.

      The social security trust fund is largely a bunch of scrap metal and unexploded bombs, mines, etc scattered around south east asia and the middle east. That's where they spent the money and that's where they will spend any increase. Unless of course they create a war in another part of the world, in which case they'll spend it there.

      Republicans are red, democrats are blue, and neither gives an f about you. They simply want more from you and everyone else.

  4. "women, people with disabilities, public-sector workers, and people of color,"
    I thought women and POC were equal?

    As to "public-sector workers" they get very generous tax payer funded pensions with contributions often much smaller than FICA taxes. Is warren going to have them pay FICA taxes and get SS on top of their pensions? In Illinois one of the scandals is how certain people can purchase their way into the government employee pension plans. It's remarkably profitable. Pay 80-100K and get seven figures of pension.

  5. Warren’s plan is not aimed at helping the recipients of SS benefits no matter their income, gender, disabilities, who they work for or race. Her plan is aimed at votes.

    She doesn’t say how to pay for the increases or concern herself with the other negatives. She knows that the voters that her campaign is oriented toward will not care enough about the particulars to look at them or ask questions. The commenter Unknown is an example.