W. Allen Wallis Quote

“When you pay social security taxes, you are in no way making provision for your own retirement. You are paying the pensions of those who are already retired. Once you understand this, you see that whether you will get the benefits you are counting on when you retire depends on whether Congress will levy enough taxes, borrow enough, or print enough money...”

~ W. Allen Wallis

May 27, 1976 

Ratings and Comments


Alan, Wirral ( England )

Its common sence in a nutshell

RobertSRQ
  • Reply
RobertSRQ    4/3/08

I would imagine he said this as the former Chairman. SS is there for those that do not save and for those that make NO provisions for their retirement. As we currently have negative savings in America this problem becomes very acute. It's all very well for the average Joe (and I'm being kind here) to shout 'ban SS' 'do away with SS' but there are many out there that have not save a dime and had no way to save a dime. This is not a socialist or Liberal program, it's a program that is a safety net for those who do not have the power or intellect to take care of themselves in their old age - it's called Compassion (forced as it may be). And, unless we practice this virtue we may as well pack our bags and switch out the light. As Thomas Jefferson said 'The care of human life and happiness, and not their destruction, is the first and only object of good government.

J Carlton, Calgary

The SS may be there for those who don't save, but what is it we are trying to save? A dollar that is increasingly worthless and will have no buying power after 20 or 30 years in the bank? The problems here are manyfold....It would "seem" that we might as well just spend everything as we go, while the money still has any value at all. Makes no sense? No it doesn't. Inflation is the great thief here. I don't know if its people so much as the government's fiscal policy of endlessly borrowing, spending, printing up money, and passing the bill onto the taxpayer that needs to change. If that happened we could well return the responsibility to each individual to care for their own future's. But until then...why not get a new flat screen TV from China?

Logan, Memphis, TN

Nothing's changed...

Dave Wilbur, St. Louis

EVERYONE is wrong! Social Security payments are IMAGINARY when all that we have in banks is numbers AND the Fed said their system of plunder "works only with credit. Credit exists ONLY in your imagination. The reason that we make no progress towards freedom, the Fed's system is just too simple for many to comprehend, Taxation is an illusion that regulates the ratio of production to consumption. In 1920, Keynes wrote: "If governments should refrain from regulation, the worthlessness of the money becomes apparent and the fraud upon the public can be concealed no longer."-- The Economic Consequences of the Peace. The Fed did not fib and Keyhes did not kid!

E Archer, NYC

Robert and Carlton make good points. Why is Social Security necessary for most people? Because the game is bankruptcy for all -- the nation, the states, and the People. So is it any surprise that after a lifetime of labors many have nothing? Americans are now more in debt than at any time in American history. Baby boomers have been carrying the load for decades, and now as they start to retire, there will be less and less people paying in to pay for more and more beneficiaries. There is no SS fund -- SS payments go to the General Fund. SS payments have to be borrowed every year -- as will more debt be required to implement a National Health Care System. We are so bankrupt we just spend, and spend, and spend like there was no tomorrow until it all comes crumbling down. If the People were the share-holders of the central bank (the Fed) there would be money pouring in for all these services, and no taxes would be required. Let the chartered banks and the government borrow from the People's Bank the same way they do from the Fed, and the entire scam would be turned into a boon, and the issuing power of the currency put back into the hands of the People.

RobertSRQ
  • Reply
    RobertSRQ    4/3/08

    Archer well done - why aren't you running for President -- no, I'm not being facetious, you have made a good point, we need a people's Bank. What I don't understand is that there are two accountabilities when it comes to a return on investment, one for the government and another for municipalities. Municipalities now are obliged to account for all pensions and medical benefits for retirees (since the Enron and MCI debacle) why don't we hold the government to the same law?

    J Carlton, Calgary

    Interesting viewpoints on the Fed: http://mises.org/

    Waffler, Smith, Arkansas

    The quote is true but fails to state what social security is. It is a social contract that insures that old people will not starve due to their inability to work. Virtually every nation, tribe, and people have some mechanism to take care of old folks. In the old days "social security" was having a lot of kids to take care of you and the farm when you got old. Since many families had a lot of kids they over populated the planet for their own selfish interests. I suggest that the social security payments received by Americans generally get immediately spent and thus are a substantial impetus to the economy. Now I will read what y'all have said.

    Waffler, Smith, Arkansas

    Archer you make some mistakes in your analysis or just have a lack of knowledge of how the thing works. SS payments do yes go into the General Fund and the SS System gets government bonds in return. The General Fund supported by income and other taxes thus gets a boost from the inflow of SS taxes which have been in excess of SS withdrawals for years. The General Fund owes SS several trillions of dollars (along with owing the Chineese trillions also). In 2020 or so when SS starts paying out for than it is taking in then they will call cash their bonds and the General Fund will have to come up with the money. Reagan cut taxes and raised SS Taxes in 1984 and financed his and the Bushes deficit spending partly with Social Securtiy Taxes. It was increased taxes on the poor in the form of SS tax raises and tax cuts for the rich. This policy must be reversed. The rich must now be taxed to pay off the bonds the government issued on money it borrowed from Social Security. In the end it is Americans faith in each other that drives the whole thing.

    warren, olathe

    True, but you are also paying for every thing else that government buys with your social security dollars. It's all the same. Goes into the same pot. Is wasted the same for the most part. Fire up the presses I'm almost there to collect.

    E Archer, NYC

    Huh, Waffler? If what you are saying is that taxes paid for Social Security got used for something else, I agree with you. if you are saying that there are entities that owe the Social Security fund for the monies they took from the fund, I can accept that. If you are saying that in the future, the demands on Social Security exceed the amount being paid in, we are on the same page still. But if you are saying that because the Social Security Fund is indeed not a fund at all because it has been raided by Congress for other things and thus we will now have to take that money from 'the rich' to cover this mismanagement, I am afraid that is where I draw the line. Congress does not have the right to invent new laws that take money out of the accounts of citizens -- that is just plain robbery. And if the People actually allow Congress to acquire and exercise this non-existent 'right' then our country is finished for by that authority we are all the property of the US government with no rights to our labors, property or even our lives.

    Waffler, Smith, Arkansas

    Youin are doing fine Archer, hang in there. Reagan and the rich crowd got tax cuts in the '80's and '90's. Congress raises and lowers taxes all of the time. Do you not remember when Clinton spoke to fat cats and said "Maybe I raised your taxes to much". Your argument that government cannot do this is false. Our nation is rich beyond our wildest dreams. The wealth is in homes, and cars, and yachts, estates, etcetera. It is a matter of public policy how the wealth of the nation (commonwealth) should be allocated between private and public purposes. SS has not been totally raided since the fund is not allowed to be invested in the stock market for example but must be invested into the government in the form of bonds. Thus the bonds are secure as are faith is in our government. Would you perhaps prefer that the SS Fund be invested in World Com, Enron, or Countrywide. The bad news is that the tax cuts received by the rich in the last 20 years must be borne by the rich of the next 20 years, and that just does not seem fair.

    E Archer, NYC

    Waffler, you say, "SS has not been totally raided since the fund is not allowed to be invested in the stock market for example but must be invested into the government in the form of bonds. Thus the bonds are secure as are (sic) faith is in our government." As has been already explained and supported by Congress itself, there is no SS fund specifically. Government bonds are nothing but more T-Bills -- mere IOU's backed by NOTHING but the 'full faith and credit of the United States.' It is just more of the same -- the government takes the very real currency paid in tor SS and spends it on something else -- in exchange we get a promise to pay it back in the form of bonds that the government merely prints up. Oh, yeah, the government will pay the interest on those bonds, by God, if they have to take everything we have, they will pay it. Suffice it to say, Waffler, you may not have the capacity to actually understand this shell game. It is all 'promises' -- we have based the future of our nation upon a bunch of hot air instead of using real currency representing real commodities of intrinsic value. And the consciousness of Americans is following suit whereby we believe we are whatever we say or promise to do. 'Credit' isn't something we give for a job well done, it is something we give while promising to do a good job before it is done. We are full of ourselves. We hardly produce anything anymore except electronic media -- and you can't eat that. It is high time we started making a shift in our thinking -- stop blaming 'them' and start taking responsibility. Charity, like morality, does not need to be legislated -- as you can see, government charity is but a promise to one day be charitable with someone else's money. May as well cut out the middle man and do it ourselves. You may get this yet, Waffler, but I am not holding my breath.

    Waffler, Smith, Arkansas

    Yeah don't hold your breath Archer. I don't get most of what you say and don't want you turning blue while I try to decipher it. Yes it is all promises and the promise of social security has come true for millions or 100's of millions since its inception in the 1930's. WE HAVE NOTHING TO FEAR EXCEPT FORGETTING THE PAST AND FAILING TO LET KNOWLEDGE OF IT LEAD US WITH FAITH IN TO THE FUTURE. Obviously you have already forgotten the past and I do not know if you can be revived to faith in the future. Archer it is a matter of public record that people have always hated the income tax since its inception in 1913 or so when it was at 2% and only applied to the richest folk. Likewise employees especially young ones have always felt that they would never collet SS. I know I felt that way. Each and every person with a SS Number can get their annual statement of account which tells them how much they have paid in and what their projected benefit will be. Archer history has shown that that many will starve without SS. What you are advocating is a return to Dickensian England and starving masses. Maybe that is okay but it is a value judgemnt and many have rejected that model in favor of the Social Security System. As far as faith in the future goes have you never educated a kid all the way through college in the hope that he might amount to something. There are no promises there just money to the wind and hope and prayer.

    warren, olathe

    Waffler the 80's so called tax break for the rich resulted in the rich paying a much larger share of the federal income tax than any time in previous history. Many of the "rich" were furious because most of the loophole that were being use to reduce the amount of taxable income were discontinued in lieu of reduced rates. The result was that the average tax paid by the top 10% of income earners went from about 7% of their gross to over 20% of their gross. Many had their tax bill triple. It also helped the Dems claim that the rich got richer because the tax returns showed almost all of the top earners income when before most of the income was deducted leaving only a small fraction taxable. So on paper the rich had a big increase in income when they were not making any more. The 80's were a big improvement for every income level but mostly lower income levels. The so called tax cuts for the rich made it so that it was more profitable to earn more money running your business the way it should be ran than running it to evade the tax man. That is the number one reason the economy boomed and the tax dollars rolled into Washington at a record rate. Need to do it again big time in order to help pay off some of this debt.

    Mike, Norwalk

    Dave Wilbur's comment says it all. Along with Archers further explanation, Social Security is a Ponzi scheme based on an ignorant belief (socialist gods - care and provide for their own / until opm runs out) The pridefully ignorant worship the god of the old age welfare state. Prior to the mental illness exercise of depending on such gods, individuals saved for their old age and large families took care of their own. With the socialist's forced breakdown of the family, socialist gods now mandate old age levels of life style (obamacare's death councils will enhance the pridefully ignorance's experience).

    E Archer, NYC

    You are right, Mike. The 'progressive' transfer of everything family to everything 'statist' continues. It is centralization in the extreme, and the result is a dysfunctional social services system that is supposed to replace the responsibilities of fathers, mothers, and children. Just obey the state, and they will take care of the rest, they say. Government monopolies on everything result in crappy and over-priced everything -- and a monstrous perpetual debt

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