Means testing is one of this things that fools people - it sounds good, but in practice is wildly bad at what it’s trying to do, and can be borderline evil.
Beyond the bureaucracy dimension - means testing puts up a barrier, not at the top, but everywhere.
Adding “one more thing” to people who are already struggling can be disproportionally difficult for them to meet, and therefore cause them to miss out on benefits they are completely entitled to.
Additionally, it can create incentives for behavior you would otherwise be completely pathological, such as divorcing your sick spouse because as a couple you don’t qualify for support, but individually they do.
The UK's DWP is a good example (and I'd suggest they crossed the border a long time ago into evil.)
* https://www.bbc.co.uk/news/uk-england-merseyside-68727007
* https://www.bbc.co.uk/news/articles/c20nrv02vz1o
* https://www.bbc.co.uk/news/uk-england-leicestershire-6770464...
* https://www.bbc.co.uk/news/uk-england-nottinghamshire-525003...
* https://www.bbc.co.uk/news/business-51756783
That's just a simple BBC search - going through Private Eye, for example, would bring up a lot more.
There's "Gary's economics" discussing it, even though the usual economic comment somehow seems to escape him.
(that would be "what about creative destruction" btw)
We do live in the only country in the developed world where “deathbed divorce” is a thing to try to ensure your surviving spouse doesn’t get crippled by medical debt, so there is that…
These non-specific appeals to emotion aren’t very convincing when we’re discussing a topic where we’re already collecting tax returns for the same people collecting social security.
Very few people earn that kind of money as taxable _income_. More people earn that kind of money as unrealized _capital gains_. Social security is paid for with a payroll tax and what amounts to an income tax. Once you're earning several times the cap you stop caring about it. If you earn 5x or 10x the cap then you will probably not be counting on social security, so there's no us-vs-them dynamic likely there. The problem is that to make this make a big different you'll have to hit hard those who earn only 1.5x or 2x the cap, and that's how you'd get an us-vs-them dynamic.
Instead you can increase the retirement age, increase the cap, increase the tax rates, lower the COLAs, etc., and that's what we've seen so far.
There’s two drivers to the actual problem here… one is that wage growth slowed a lot since wage indexing and the yield on those taxes is lower in real terms. People who are making more make a lot more, and frankly that’s a well that needs to be tapped.
The other is less popular… but we’re in wind down of nearly 25 years of conflict. The events of 9/11 were engineered to and succeeded in created the same type of economic attrition the US ultimately inflicted on the Soviets.
We’re at a tipping point… our social insurance is approaching entirely avoidable cash flow insolvency. 25 years of war means that the military is worn out and needs trillions of investment to maintain parity. Ignoring the problems our strategies created brought us with a reactionary buffoon destroying the government and a fairly dim decade ahead.
You say this as it's some sort of injustice. But the guy who makes 10 million will collect the same benefit in retirement as the guy who makes $176,100. Or are you proposing that the guy who make $10 MM should pay more, but get their benefit capped? Because if that's what you are proposing, I don't see how that is just or fair. Except maybe following the argument along the lines "screw the rich, they can afford it".
It is absolutely a "fair" and "just" thing for a society to do to itself.
It is in no way like insurance today, and never has been. It has always paid out independent of circumstance. It was never about equity either - The poor get less, and the very poorest get none. Again, this is the way it has been since conception.
It is a state mandated pension with low returns and a progressive fee. Noting more.
My analogy to insurance was more about whether you pay into "your" account with your name on it or if you pay into a big fund directly pays out to recipients, and nothing is held aside for you.
The money isnt held in a dedicated account with your name on it. However, how much you pay in is rigorously tracked and used to directly to determine how much you get.
The closest thing is a pension. Like a pension, SS pays out X% of your taxable salary. X is progressive with high earners heavily subsidizing low earners.
SS starts by paying out 90% of taxable salary in the lowest bracket. As income goes up, this reduces to paying out 15% in the top bracket. The brackets are referred to SS bend points.
I agree; it was a poor choice of analogy on my part.
... you'll notice that taken to absurdity this is the same statement as "everyone should be paid the same". And that's been tried.
Taking things to absurdity is itself absurd.
Let's also add fines and traffic tickets to the list of things that ought be more expensive as one becomes wealthier please.
It seems to me like government programs is a poor delineation, as government can pass a law to extend its own scope.
Why not groceries or clothes?
Well, programs like TANF and SNAP exist, which I think are great and their greatest problems are they are not easy enough for people to make use of.
So, fair point, when looking at the most impoverished among us I do not think we should stop at governmental services.
Feels like we're splitting hairs a bit here.
I guess im still looking for some limiting principle. Why not just mandate that all goods are sold proportional to income.
There are ways to disentangle the undesirable incentives. The Nordic countries in particular have done a great job of this.
This was reality under the Soviet system, and was one of the main reasons it failed.
Now, I understand why I am getting all the cheeky responses and the downvotes. People are hurting. Capitalism in the US is currently failing under a different failure mode. The capitalists are relentless optimizers, even past the point where optimizing their metrics stops making sense. Their metric is "extract as much wealth from the populace as possible", and it's gotten to the point where the people are disillusioned, and very soon there will be nothing left to take.
You get to live in a stable society, in relative order, safety, and peace. Your life is (financially) richer than 99.99999% of people in the world. All of this in exchange for a small portion of your wealth, and yet you STILL want to complain about the unfairness of this arrangement?
Push it too far, and the only alternative you're going to get is having to look over your shoulder everywhere you go, living in constant fear that someone will pillage your property and threaten your personal safety.
But that's the thing: is Social Security a safety net or is it welfare? If it's a safety net, means testing (can at least in principle) preserve the safety net aspect.
If it's welfare, you're transferring wealth from people currently working to those retired, many of whom are much more comfortable than those paying the tax. Why are we transferring wealth to those with more from those who must work?
It's an increasingly common distinction today, and is actually cited as a reason for social securities high support (see: https://www.cbpp.org/research/social-security/top-ten-facts-...):
> Finally, Social Security’s nearly universal nature ensures its continued popular and political support; 79 percent of Americans oppose cuts to the program.
It is not an exaggeration to say that politicians explicitly argue against means testing because they want universality to keep it a third rail and became an increasingly prevalent sentiment during the COVID crisis when money was cheap. For example (https://www.vox.com/2021/10/15/22722418/means-testing-social...):
> “We can choose to strengthen the bond Americans have to one another by proposing universal social insurance benefits that broadly benefit all Americans, or we can pursue complicated methods of means testing that the wealthy and powerful will use to divide us with false narratives about ‘makers’ and ‘takers,’” leaders in the Congressional Progressive Caucus wrote in a letter to House Speaker Nancy Pelosi on Wednesday.
while simultaneously arguing social security is necessary for the economic security of every family (https://www.vox.com/2021/10/15/22722418/means-testing-social...).
And that's the point: there is a very real portion of the party that, rather than cutting Jeff Bezos', Warren Buffets, Bill Gates' and other wealthy individuals who can survive without the cuts social security would rather raise taxes to pay more benefits because it is good politically. It's absolutely absurd, and highlights how the discussion is manipulated to ensure that social security as a political third rail continues rather than addressing seniors actual needs.
are you really getting screwed though, if you can't feel it?
> are you really getting screwed though, if you can't feel it?
I say this kinda-sorta in jest, but in truth, there's a somewhat huge contingent of the ultra-richest of the ultra-rich who are absolutely guilty of such "Screw the poors." behavior. The ongoing and worsening effects of this specific outta-control inequality speak for themselves. Worst part of it is that the things they're doing these days aren't only going to harm just some of humanity, but rather all of humanity, as well as most all other life on Earth.
They could choose to spend the money they've spent doing outright "evil" (bad things that harm everyone) doing good instead, and cemented their places in the history books among many other great humans who made the world a better place during their time here on Earth, but instead they actively choose to do harm, many of them full-well knowing they're doing harm.
It's hard for me to look at the idea of "law, policy and regulation should now move the needle in the other direction" and see that as grossly unjust. We can debate whether social security is the right place to do it, but it seems like one of the top options to me, considering the huge wave of people who are going to be jobless, old, poor and alone, and therefore vulnerable, as the Millennials age.
Yeah, people who make more money should pay more to fund the government. Apparently this is a wild concept for some.
It's not and it doesn't need to be. If I make 10 million dollars a year, I don't need social security period. I'm going to be fine no matter what. I personally would not mind, at all, giving up a portion of my income to other people who are not so fortunate.
It's like giving the fat king and the starving orphan both one slice of bread. Sure, it's fair, but does the king need the bread? Who cares about fairness when the playing field is already so skewed in favor one side?
Also: the reality here is that rich people pay WAY less taxes proportionally compared to the poor. If we want to talk fairness, we have to start there. Poor people are spending 100% of their income on consumption, it's going straight into the economy. It's getting income taxed and it's getting sales taxed.
If rich people had to pay anywhere close to the amount of taxes the working class or the poor do, they would turn to dust. I'm sure they're fine in their already extremely favorable position. In short - give me a fucking break.
Someone who makes 10 million dollars (or 100 million, or...) a year pays the exact same social security tax as someone who makes $176,100.
You don't even have to raise the cap by very much to fix every foreseeable funding issue Social Security has