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A Review of the Social Security Myth by Milton Friedman

Updated on April 29, 2014

Friedman calls social security the greatest sacred cow of them all. It is a combination of bad tax system and a bad way of distributing welfare. No one today would defend either system separately. Social security system consistently refers to the taxes that you pay as a contribution. There was no underlying public demand for social security. In 1930, the demand had to be created, developed, and produced. This was done by people who sincerely wanted an expansion in the scope of government. Social Security was sold as an insurance scheme. There is very little relationship between social security and traditional insurance. The amount of money that someone makes doesn’t depend on his or her poverty or his or her indigence but depends on the type of industries that he or she works at. Freidman says that a tax on wage is up to a maximum. It is a tax on work that discourages employers from hiring people and that discourages people from going to work. It is born on lowest wage group. The people who pay more taxes will receive more social security benefits than those who do not. If someone is at retired age but chooses not to retire and chooses to work, he or she receives no benefits but has to pay taxes in what he or she makes. If the person chooses not to work, he or she will receive benefits. Social Security subsidies are categorized as benefits. Today, we have a system where people have been taxed to pay to the people who are receiving them. That is, the young are taxed to subsidize the old. Social Security taxes are not invested in a system that allows employers to save for their own retirement benefits.


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    • ladyguitarpicker profile image

      stella vadakin 19 months ago from 3460NW 50 St Bell, Fl32619

      Where did this video come from? It is not telling the truth and should be removed. People in 1932 and after World War 11 were in sad shape, and the nation needed a plan for its people.

    • teaches12345 profile image

      Dianna Mendez 3 years ago

      I am certain we will see additional changes regarding Social Security over the next few years. It is not what it used to be in providing security to society. Let's hope they get it all figured out soon.

    • The0NatureBoy profile image

      Elijah A Alexander Jr 3 years ago from Washington DC

      I completely concur with your addition and want to add to it. To be "The United States of America" there can be no classes, gender discriminating, ethnic discriminations, political parties nor sexual orientation recognition because this is a nation, which is not considered a religion, so the differences caused by religion has no place in The United States of the Americas.

      As for the remedy to the working Social Security retired, I haven't concluded what should be done in any form. I don't believe one should be paying into something they will not get any benefits from but I Have not as yet considered what can be done about it. As for me, my income is a paupers but since I am not a person desiring things I'm living well within the means of it. But, if I desire to work again I don't see why I should have to pay into something I will no longer be able to benefit from.

    • MizBejabbers profile image

      MizBejabbers 3 years ago

      Theonatureboy, I have to agree with most of your statements. I would like to add one thing to your statement about the "SUPPOSED TO BE United States of America". It seems to me that the disunity among the states about basic human rights constitutes discrimination among classes of people.

      I do wonder about your statement "The part about being retired and working is true... I have been given information revealing that truth and am working toward the remedy." Do you mean that you are working to put a stop to working and drawing at the same time? To stop older workers from working and drawing would cut millions of dollars paid into SS. Just remember those of us who are working and drawing are also still PAYING into the fund, and the more money we make, the more money we pay in. Workers never stop paying in (unless they are working under the table). This helps those who come after us. Retirement is great, if you don't mind living as a pauper.

    • The0NatureBoy profile image

      Elijah A Alexander Jr 3 years ago from Washington DC

      Milton Friedman sounds like he is a part of the campaign to eliminate Social Security (SS). He presented a mixture of facts and fiction, leaning more toward fiction than facts, with just enough facts to make the fiction sound believable. Because government has introduced addictive substances to man causing many people to neglect the unalienable life sustaining rights for substance(s) of addiction, Corporations are wanting to abolish SS. It is from that perspective Milton Friedman speaks rejecting it.

      With the Bill of Rights saying man has "Unalienable Rights to Life" and the Preamble to the Constitution suggesting equality among all Citizens of these SUPPOSED TO BE United States of America, the basic substances for supporting life is to be uninhibited or priced, and that includes the use of anything the earth produces with, such as farming, or without the aid of man. However, the nation allowed "Free Enterprise" to put a monetary price on food, and now water, so a means to the basic rights to life had to be provided for the many people who lost their jobs and had no means of obtaining them, because of the monetary price, thus, SS was instituted. Also, because man are mentally conditioned to need shelter and clothes it was also implemented to assist us obtaining those conditioned into us life requirements.

      The part about being retired and working is true, how to correct that is something I have not, as of now, discovered how it cane. Since I've just found myself retired -- although I prefer living as a pauper -- I have been given information revealing that truth and am working toward the remedy.

    • tirelesstraveler profile image

      Judy Specht 3 years ago from California

      I would really like to know who MizBejabber works for; she has something really nice going for her. Employers who don't pay SS into their account and all their employees accounts get friendly with the IRS in a big hurry.

    • The0NatureBoy profile image

      Elijah A Alexander Jr 3 years ago from Washington DC

      Social Security (SS) is not what Milton Friedman described, he is a proponent of the push to dismantle Social Security. SS was implemented because the depression of 1932 left man a people without society's basic social needs {food was no problem but the purchasing power of what "free enterprise" deems are need}. Because the Bill of Rights states we have "unalienable rights to life" air, food and water are not to cost money for anyone but since "free enterprise" has been allowed to make a market out of food the government provided a means for everyone to have access to those needs and a few socially conditioned into us desires we believe to be needs. Had government prohibited food and water being sold, as the "Bill of Rights" states, SS would fall under the conditions Milton Friedman made. What he said about working after retirement age is completely correct and is the only thing about SS which should be corrected. I have not yet figured out how it can be correct but given time enough I will discover how to do it.

    • profile image 3 years ago from upstate, NY

      Social security is an elaborate shell game concocted by leftists politicians to buy votes and increase dependency on government. It's really a wealth redistribution scheme and another way to tax the public to increase the power of the political class.

    • rebelogilbert profile image

      Gilbert Arevalo 3 years ago from Hacienda Heights, California

      This coming election season there will be plenty of debates about our tax system. Many people are concerned employers have to spend an extra amount of money for hiring people. And are in deed nervous about it. So they don't hire. I've heard plenty of complaints about it on CNN and Fox News. Our economy is making progress but we have a long way to go. I've also heard that younger people are getting taxed to help the old. In fact, that's an important component of Obama Care.

    • MizBejabbers profile image

      MizBejabbers 3 years ago

      Where the heck did that come from? Not a word of it is true. I am still working and simultaneously drawing my SS. I am also paying in and my SS goes up every year because of the money I pay in. Employers can pay into their own SS accounts. He is so full of horse pucky.

    • paulynice roldens profile image

      Roldens Paulynice 3 years ago from Boca Raton, Florida


    • B. Leekley profile image

      Brian Leekley 3 years ago from Kalamazoo, Michigan, USA

      As can be expected of a propagandist of the free [of responsibility and morals] market philosophy of capitalism, Friedman's lecture is mostly, if not entirely, falsehoods underlined by advocacy of the sin of individualism.