With blatant disregard for any type of basic math, President Obama recently called for an increase to Social Security benefits. Millennials, who pay into Social Security without realistic expectations of receiving their promised benefits, should be furious that neither the president nor the presidential candidates will tell the truth about Social Security's broken finances.
As President Obama argued in his June 1 speech in Elkhart, Indiana, "We can't afford to weaken Social Security. We should be strengthening Social Security. And not only do we need to strengthen its long-term health, it's time we finally made Social Security more generous, and increased its benefits so that today's retirees and future generations get the dignified retirement that they've earned."
There are two main problems with these claims. First, unless Americans are fine with possibly paying a 31 percent payroll tax (up from 15 percent today), entitlement programs cannot afford to maintain their current course—much less be expanded. Second, retirees receive far more than they pay in from the program commonly known as the "third rail" of American politics.
President Obama was light on the details of his proposed expansion. But one can assume that he is lining up to support the policy views of Democratic contenders Hillary Clinton and Bernie Sanders. Clinton wants to expand Social Security, while Sanderscalls it "the most successful government program in our nation's history."
House Republicans, namely House Budget Chairman Tom Price, are making serious efforts to straighten out American's broken entitlement systems. Unfortunately, likely Republican presidential candidate Donald Trump promises he "will not cut" Social Security. Trump has promised to fully fund the program through higher GDP growth. But even if GDP growth magically shot up to 60 percent above the current long-term estimate (2.1 percent), the program will still end up insolvent.
As President Obama argued in his June 1 speech in Elkhart, Indiana, "We can't afford to weaken Social Security. We should be strengthening Social Security. And not only do we need to strengthen its long-term health, it's time we finally made Social Security more generous, and increased its benefits so that today's retirees and future generations get the dignified retirement that they've earned."
There are two main problems with these claims. First, unless Americans are fine with possibly paying a 31 percent payroll tax (up from 15 percent today), entitlement programs cannot afford to maintain their current course—much less be expanded. Second, retirees receive far more than they pay in from the program commonly known as the "third rail" of American politics.
President Obama was light on the details of his proposed expansion. But one can assume that he is lining up to support the policy views of Democratic contenders Hillary Clinton and Bernie Sanders. Clinton wants to expand Social Security, while Sanderscalls it "the most successful government program in our nation's history."
House Republicans, namely House Budget Chairman Tom Price, are making serious efforts to straighten out American's broken entitlement systems. Unfortunately, likely Republican presidential candidate Donald Trump promises he "will not cut" Social Security. Trump has promised to fully fund the program through higher GDP growth. But even if GDP growth magically shot up to 60 percent above the current long-term estimate (2.1 percent), the program will still end up insolvent.
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