Reasons for Social Security Reform, # 74

The United States Supreme Court concluded, Flemming v. Nestor, 363 U.S. 603, 609-11 (1960), that paying Social Security tax does not create any enforcable "right" to receive Social Security benefits:

Payments under the Act are based upon the wage earner's record of earnings in employment or self-employment covered by the Act, and take the form of old-age insurance and disability insurance benefits inuring to the wage earner (known as the "primary beneficiary"), and of benefits, including survivor benefits, payable to named dependents ("secondary beneficiaries") of a wage earner. . . Of special importance in this case is the fact that eligibility for benefits, and the amount of such benefits, do not in any true sense depend on contribution to the program through the payment of taxes, but rather on the earnings record of the primary beneficiary.

The program is financed through a payroll tax levied on employees in covered employment, and on their employers. . . The tax proceeds are paid into the Treasury "as internal-revenue collections," I. R. C., 3501, and each year an amount equal to the proceeds is appropriated to a Trust Fund, from which benefits and the expenses of the program are paid. 201, 42 U.S.C. 401. It was evidently contemplated that receipts would greatly exceed disbursements in the early years of operation of the system, and surplus funds are invested in government obligations, and the income returned to the Trust Fund. Thus, provision is made for expected increasing costs of the program. . .

Plainly the expectation is that many members of the present productive work force will in turn become beneficiaries rather than supporters of the program. But each worker's benefits, though flowing from the contributions he made to the national economy while actively employed, are not dependent on the degree to which he was called upon to support the system by taxation. It is apparent that the noncontractual interest of an employee covered by the Act cannot be soundly analogized to that of the holder of an annuity, whose right to benefits is bottomed on his contractual premium payments. . . .

That program was designed to function into the indefinite future, and its specific provisions rest on predictions as to expected economic conditions which must inevitably prove less than wholly accurate, and on judgments and preferences as to the proper allocation of the Nation's resources which evolving economic and social conditions will of necessity in some degree modify.

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. See Wollenberg, Vested Rights in Social-Security Benefits, 37 Ore. L. Rev. 299, 359. It was doubtless out of an awareness of the need for such flexibility that Congress included in the original Act, and has since retained, a clause expressly reserving to it "[t]he right to alter, amend, or repeal any provision" of the Act. 1104, 49 Stat. 648, 42 U.S.C. 1304. That provision makes express what is implicit in the institutional needs of the program. See Analysis of the Social Security System, Hearings before a Subcommittee of the Committee on Ways and Means, House of Representatives, 83d Cong., 1st Sess., pp. 920-921. It was pursuant to that provision that 202(n) was enacted.

We must conclude that a person covered by the Act has not such a right in benefit payments as would make every defeasance of "accrued" interests violative of the Due Process Clause of the Fifth Amendment.

Despite those yearly notices predicting your Social Security payout, the money's not yours. Under Bush's plan, at least some of it -- the portion invested privately -- would be.

What else do you need to know?

More:

Here's what taxpayer-supported NPR wants you to know:

Ron Elving, NPR's Washington editor, has instructed National Public Radio staffers not to use the word "reform" to describe President Bush's proposal to change the Social Security system, NPR's media critic Brooke Gladstone reported on Monday's Morning Edition. "Reform, if you look at the dictionary, has a strong implication of improvement, to better something. It's a corrective process," Elving argued.

But a decade ago, NPR's Morning Edition crew had no problems referring to the Clintons' plan to increase the government's control of the health care industry as "reform." Back on September 23, 1993, host Bob Edwards intoned: "President Clinton went before a joint session of Congress last night to announce the most sweeping domestic initiative in a generation, his long-awaited health care reform plan."

Aggregating government grants spread over a dozen programs, taxpayers fund about 15 percent of NPR's budget. With hundreds of channels on cable and satellite, NPR went from unique to redundant in 40 years. Especially in news, where three major commercial networks toe the same liberal line. NPR is leftist corporate welfare--and should be zero-ed just like farm supports.

(via Templar Pundit)