Do you know this person, or is this you?
Social Security has a problem. We all know that. The system is heading for financial ruin, as payouts exceed contributions year after year. There are several reason why this is so, including the expansion years ago into Disability Benefits, our shrinking working age population, years of declining wages, and an entire segment of American workers who aren’t paying into the system. In order to understand the last point, I created this hypothetical, but common, explanation, which illustrates a serious problem that has existed for a very long time. Tens of Thousands, and perhaps millions, of American working people are in this situation, and the result is devastating for them, but also for the Social Security System itself.
Does this describe you? Or, perhaps, someone you know?
“I woke up this morning, looked in the mirror, and staring back at me was a 65-year-old face. How did that happen? I was young not so long ago. What will next year bring?
“Every morning for the last 10 or 15 years, some part of me hurt. It always seems like a new and different pain from yesterday’s pains. I shrugged it off, went to my job site, and did my usual thing. Years ago, my buddies and I did day labor while we developed job skills. Each of us started to get really good at something, whether drywall, wiring, painting, plumbing, or whatever. Personally, I became a darn good (fill in the blank) guy. My friends did everything from framing to trimming, electrical to odd jobs, and steadily picked up a flow of cash from small construction and remodeling jobs.
“There’s that magic word – cash.
“Who wouldn’t want to work for cash? No taxes, I’m “off the radar,” and the cash is easily spendable. I have everything a guy could want, right?
“As time went by, we did more and more jobs “off the books.” No government involvement, no IRS making cuts in take-home pay. We had it made. Customers loved the cash discounts. For decades it lasted, as time seemed to slide by effortlessly.
“Now I’m older and I’m tired. My aches and pains are worse, bending over hurts, and lifting any significant weight is excruciating.
“But I have no money. I have no pension. I have no retirement savings. When I applied for Medicare, they told me at the Social Security office I hadn’t qualified. Not enough quarters worked. Not enough money paid into the system. “But I did lots of work,” I explained, and they responded that they have no record of my life’s employment. Naturally, I suppose, as I was paid in cash. And I spent it. All of it. I should have saved some.
“What about my retirement income for life? That is supposed to be Social Security, they told me, and if you are qualified, you’ll get it. For life. “But you, personally, are not qualified,” they said.
“I was not qualified, according to their rules. I didn’t report earnings for the requisite 40 quarters over my lifetime, because I worked mostly for cash. But I raised two kids, and my wife and I always put food on the table. What’s wrong with that?
“Taxes. “Payroll taxes,” they say. “But I didn’t have a payroll job,” I explained. So I didn’t pay into the system. “Not my problem” they said. What a response!
“What do I do? I can’t lift tiles forever, I can’t mix mortar and grout forever, pounding nails is difficult, and I certainly I am not qualified to do a desk job. My body hurts. Now my mind is catching up with my body; getting slower. Which hurts more? I can’t say right now.
“I feel so alone, but I know I’m not alone. All the guys worked like I did – cash at the end of the day. Picked up a six-pack on the way home. Wives and kids always had food on the table from yesterday’s cash. All was well. We all did it that way.
“But now I’m tired. Oh, so tired. And I hurt. All over. Every day. I can’t do this forever. Is it forever yet?
“Alone – I feel so alone. I have financial obligations. Obligations to myself, to my wife, to my kids, to the rest of our lives. But I have nothing left except my diminishing capacity to earn the next dollar.
“I was raised to be too proud to take welfare, even when we called it “public assistance,” and we had to whisper the term in polite company. I’m so screwed. Nobody told me this would be the end result. Why?”
Do you know that person? Or, does this sound like you? Millions of Americans lament this fate every day, they echo the litany, and they live the despair. Who is to blame? What will society to do?
There is no single answer, and while there is widespread agreement on the problems, there is equally widespread disagreement on the basic answers. Who is responsible for this financial mess? Who is responsible for the propagation of this condition? What can be done? What should be done? What will it cost? Who will pay? Is it fair?
This dilemma has had me concerned for decades. Thank God (and my parents) I was not caught up in the financial death spiral of going nowhere by living day-to-day “off the grid.” Does it bother me that I don’t feel terribly guilty? Sure it does, but it isn’t exactly true. I do feel compassion, but only as a cog in the society that created this monster. Also, for decades I have paid and paid and paid into the system, and still the system is nearly broke. And broken. While the problem was festering, it was easy to generally ignore a mounting societal problem. It is quickly becoming more visible, and therefore harder to ignore.
On the brighter side, the working age population shrinkage is reversing, as the very large Millennial Generation is paying into the System, to someday support the much smaller Gen X population. A quicker and better “fix” would be to stimulate the number of payroll jobs with higher incomes. Public policy needs a boost.