September 6, 2011 4:26 AM
The budget deficit is the greatest threat to Social Security. As deficit increases, interest costs create an increasing footprint on our tax base. As interest costs go up, the ability of workers to pay into Social Security goes down.
Some think that the problem with Social Security is the number of workers to retirees. The flaw here is that workers do more than support retirees; specifically they pay income taxes which support the deficit. Today, the average worker is carrying almost $100,000 of look-through debt from the federal government alone. The additional debt burden means that the worker today is not comparable with the worker of 2000.
We are kidding ourselves if we believe that Social Security doesn’t add to the deficit. Senator Sanders is going to introduce a bill to increase payroll taxes. If we can raise taxes, we should raise taxes to lower the deficit, rather than to fund a retirement account.
I am a boomer, and we have left our children a staggering debt. We shouldn’t be surprised if they resent the obligation to take care of our debt and the people who created it.