The Great Fraud

Ok, I have found a bunch of my old stuff and am in the process of posting it. This is something I wrote several years ago when in a particularly foul mood.

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I have always believed that taxes in general were entirely too high. By the time I pay my federal and state taxes, my property taxes, my vehicle tags, my fire dues, the sales tax on nearly every purchase - not to mention all the taxes which are built into the cost of nearly every product or service I obtain and that I have no idea how much they may be - I have lost a great deal of what little money I make to taxes. I realize that some level of taxation is absolutely mandatory if we are to have the necessary government functions pertaining to the protection of the life, liberty and pursuit of happiness of every individual. However, the level of taxes we pay, as well as the "services" rendered for them, are far out of line with where they should be.

Beyond all this, though, lies an even greater problem in my mind. Recently while filing my federal return for this year, I came to realize that even these taxes, as "taxing" as they are, do not get under my skin to nearly such an irritating level as the one other tax I have to pay which is not even mentioned in the rather substantial list above. I am talking about the Social Security tax.

Previously this was not as noticeable, nor as maddening as it is now. For, unlike in years passed, I have for the past several years been self-employed. The self-employed person must honestly make account of every penny he has earned, then honestly account for every expense he deducts from that. Woe unto him who makes a mistake in all this complicated business! Once that net income is calculated, we can take a generous discount of just over seven and a half percent from it. This new figure, over ninety two percent of our net income, is then taxed at a rate of just over fifteen percent. That is to say, my actual net income is taxed at just over thirteen and three quarters percent. This amount goes to the Social Security fund.

Think about that for a minute. On top of the federal, state, local, sales, property, and other taxes I have to pay, here is another almost fourteen percent of every penny I make taken away from me and my family. Considering such essentials as food, clothing, housing, transportation, and health care, which together run into the thousands of dollars per year, as well as other taxes, which run into the thousands of dollars per year, I still have to consider yet this further tax, which runs into another several thousand dollars per year. Just exactly where in the world does the government suggest I get this money? I can not cut out such essentials as food and clothing. However, I can not cut out such non-essentials as taxes, for if I did, I would likely end up in jail. Great system!

It would be humorous were it not so sad, that the very people who have placed all these onerous tax burdens upon us, are the exact same ones who claim to care about the working man. Well, I really do not know what exactly you would call me (and millions of others) but a working man. Frankly, I think I prefer to do without the help. In fact, I can not afford this type of help! If Washington actually cared the least little bit for the common man, or even the not so common man, they would do everything in their power not to hinder man's attempts to better himself. Taxation of any kind is a severe hindrance. While some level of it may in fact be necessary, surely we must reign it in. Social Security would be an excellent place to start.

I have been self-employed for about three and a half years. Thus far, I have been slowly growing my business until this year, for the first time I made a noticeable improvement. Thus far, I have been living largely of the "fat" I had earned before. That is to say, I have been slowly dwindling what I had earned while gainfully employed in the highly regulated semi-private sector. This year, I made great headway and did not have to skim quite as much fat as before, though I still had to fall back on some money previously set aside for retirement just to pay my bills. However, having just barely stayed afloat, I am now faced with a tax bill which I am uncertain at this time how I will meet, especially when considering that I now also have this year's income for which to continue to pay these taxes. The overwhelming cause of this problem is not state or federal income taxes, though. It is the self-employment tax which is for Social Security.

"Oh", but you say, "This is for you! This goes into helping you finance your retirement." Oh, okay, I guess I am just too stupid to do that for myself!

We need to rise up and call Social Security what it really is. A fraud. A fraud imposed on the masses of citizens of this country.

First of all, do I have any guarantee that I will ever see any of that money again? No. I have heard horror stories of people paying thousands of dollars into that system, then having the misfortune of dying before they reached the age where they can collect. What becomes of all that money they paid in? If I am fortunate enough to receive some Social Security payments some years down the road, is there any guarantee that I will get all of it back, plus simply the interest it could have accumulated had I put that money even in a low interest bearing savings account? No. Maybe I will get none of that money, maybe little, maybe a significant portion, or, maybe if I am lucky, I may get more back than I ever paid in, plus the accumulated interest. This last scenario would require several strokes of good luck, and I am more inclined to think that one of the other scenarios is far more likely.

In the meantime, I have to struggle simply to make ends meet, while someone else is getting paid off the money that I am putting into this money pit. Do I have any guarantee that the people receiving my money need it as bad, or worse, than I? No. Herein lies one of the many insanities of this whole system. The money which is wrenched from my hands, against my will, and which I can not afford, does not even go into an account with my name on it, to be grown and returned to me upon my retirement, at my desire, at some future date. It is placed in a fund used to pay people who are now in retirement. What happened to the money that they put in all those years? It went to the past generations when they retired!

We all know how the mathematics of this system works. The way it is funded, coupled with changes in the population growth, has caused this inane system to grow to the monster that it now is. When this system was started, the ratio of people paying into the system to the people receiving from it was such that the effect on the payers was not really noticed to a great degree. However, the inception of the baby boom generation, along with the lower birth rates subsequent to this, gives us a situation that as the baby boomers retire, this ratio becomes slanted more and more against those who are currently, or will be, paying into the system. Proportionally, less people are paying for the retirements of more people.

This situation is so bad, that if I were to concoct such a system as this, then try to go out on the free market and sell it to individuals who would buy into it of their own free will, it would be illegal. However, when the government does the same thing, only not freely but by force, it is called an entitlement. But an entitlement for whom? I certainly do not feel like I am "entitled" to pay a significant portion of my much-needed income so that some retired executive with about a hundred other sources of income and savings can receive it!

Social Security is such an ingrained part of American Culture now that it is nearly impossible to reform it, much less completely do away with it. The best the politicians can seem to come up with is this rather corny idea that we could now take a small percentage of it, and be forced to invest it in some sort of semi-private market – all still by the force of and under the direction of the government. This still is not right. It is still the government telling us what we are to do with the money we make. I am responsible for myself, and my own planning. I am in business for myself to gain the level of freedom for myself and my family that I desire. I certainly plan to grow this business in such a way as to become independent of anyone else for my well being. However, this is much slowed by the fact that probably well over half of my income goes to taxes in some form or other, most notably to this fraudulent atrocity.

I think the necessary reform for Social Security is nothing less than this: We must make it voluntary. Anyone who wants to "invest" in this system could be free to do so. Anyone who chooses to bypass receiving such "help" from the government and go it alone, could and should likewise be free to do so.

The cry of the entitlement crowd can already be heard. "But if it were voluntary, the whole system might collapse!" The answer to this objection is present within the objection itself. This system would collapse if it were not for the government's use of force against its citizens to keep it intact. Any system which requires that free citizens be forced to participate in order for it to "help" them, is surely not a system worth having.

Would you voluntarily give up any supposed benefit you might get at some point in the future, assuming you lived long enough, if it meant more money in your pocket right now – money you could invest or spend as you best saw fit in your own preparation for your own future, as well as your own provision for yourself and your family? I know I would gladly right now give up any claim on any money I may have coming to me in the future - even at the loss of the thousands of dollars I have already put in - if it meant that I would no longer be forced against my will to place yet more money into the fund. I will gladly provide for the needs of myself and my family. I will gladly prepare for my future. I will gladly voluntarily help those I can. But I will support such fraudulent entitlements as this only at the threat of violence, which is precisely the only reason that I am going to find some way to meet this current tax burden.