Without Social Security, American Kids Can’t Dream Big

The recent annual report from trustees’ of Social Security and Medicare has cast doubt on the social programs’ long-term solvency. With monies expected to run dry for Social Security in 2034 and portions of Medicare in 2026, it’s quite possible that our children will not see the benefit of programs that have long allowed America’s elderly some security after a lifetime of work. The upshot is that parents should probably start encouraging their children to go into lucrative fields like healthcare and insurance instead of chasing their dreams or stop voting for politicians who insist on weakening the social safety net. Doing both no longer makes any coherent sense.

It’s important to point out that the details of the trustees’ report are not as dire as they seem. The Social Security program is expected to pay 100 percent of benefits only up to 2034, when that amount would be reduced to 77 percent of currently scheduled benefits. On the other hand, money for Medicare Part A will run out in 2026, reducing scheduled payments to 90 percent. Which means that people will still receive benefits, just not all of their benefits. That might be bitter relief to you, but it means little for children. The way things are trending, they are unlikely to reap the benefits of their investment in the programs.

However, the trustees’ report illustrates in no uncertain terms that the current policies of the majority party continue to chip away at Social Security and Medicare. That makes the social programs’ long-term survival dubious if something doesn’t change soon. Again, voting against entitlements on political grounds is understandable if your goal is to shrink entitlement — tough logic, I know — but utterly anathema to the idea that children should pursue their dreams (unless those dreams involve clawing up the management latter at a financial services firm).

The unnerving thing, or one of them anyway, is that minor changes could reverse existing trends. Both programs, in fact, could be significantly strengthened by increasing the number of people paying into the program and how much they pay. According to the trustees, that last bit could be accomplished by asking the super rich, who can afford both retirement and Cadillac medical insurance, to pay their fair share into the system they can benefit from but do not need. Currently, there’s a taxable income salary cap of about $130,000 per year. Regardless of whether not you pull down more than $130,000, you will not be taxed on income over that amount.

For Medicare, trustees note that politicians could bolster the program by strengthening the Affordable Care Act, mainly through reinstating the individual mandate that requires people to be insured. The repeal of that mandate will likely hurt Medicare as hospitals draw money from the program to treat uninsured patients, the amount of whom will certainly increase.

Neither of those ideas is particularly popular among current congressional majority leadership. In fact, they’ve done their darndest to kneecap social welfare programs by cutting funding sources via changes in tax law. And while they laud themselves on short-term relief, the bill will be paid by our children who face a future where they will need to get rich or die trying.

That means my priorities need to change as a parent. Not only do I need to be much more worried about my retirement, I need to be much more proactive in leading my children to a career that will see them through their own old age. Given the terrible outlook, those careers will likely be in insurance and medicine. Because not only will people need to pay more to cover the cost of their care, they’ll also likely be sicker because they have to ration the care they need. That will increase the need for people who can process claims and help people heal. Increased need means better job security and better wages.

Of course, it’s going to be tough to explain all this to my kindergartner and second-grader. But I figure if I buy more medical toys and help them learn math through actuarial tables, they’ll eventually internalize the fact that there is only one sure path to survival, and that’s it’s unlikely to come from legacy government social programs.

In the meantime, I will hedge my bets by voting for politicians who are serious about reinforcing programs that have worked in the past. Who are they? Well, right now, they are unlikely to come from the GOP — which, for what it’s worth, isn’t a euphemism for Democrats, who are also to blame for current trends. Why care about social programs? Because I want my boys to have choices and they won’t if financial planning amounts to bribing the Grim Reaper to wait a year or two longer.