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Social Security and the Free Society

Social Security has had a profound effect on the way Americans view the government’s role in society and on our confidence in the free society’s ability to solve difficult social problems. Make no mistake, the care of the aged is a difficult social problem that, in my opinion, cannot be solved through purely market means. To say that it cannot be addressed by means of economic exchange alone, however, is not to imply that public solutions are always preferable to private ones. Once we give the state the power to determine how the generations will relate to each other financially–which is the real issue with Social Security–we lose the ability to conceive of possibilities outside the purview of politics. Such myopia is a disability peculiar to those whose lives are consumed by politics.

A good start toward solving this problem would be to present a clear outline of some of the economic, social, and cultural consequences of Social Security. I offer the following not as a “policy wonk” but as a priest concerned with the moral fabric of our nation and our families.

One economic consequence of our current Social Security program is lower savings. Not only do Social Security taxes reduce how much income people have left over to save, but they also reduce the incentive to save today, based on the prospect of big payoffs down the road. The discipline of thrift does not occur in a vacuum, nor does it occur for purely ethical reasons. People save to overcome uncertainty, and to the extent that the state artificially reduces uncertainty, it reduces the perceived need to save.

A social consequence of Social Security is reduced inter-generational responsibility. It was once well-understood that the middle-aged have a moral responsibility to care for their aging parents, just as parents care for their young children. Such responsibility establishes a crucial social link between the generations, a link essential for continuity of values, traditions, and habits, as well as for establishing a basic sense of coherence and identity among people. Social Security has gone a long way toward severing such ties, making people feel that they are freed from the responsibility of caring for their parents. Further, it reduces an incentive for couples to have children, since parents no longer see children as a “safety net” for old age. Thus, Social Security devalues our culture’s view of the family.

Finally, a cultural consequence of Social Security is the crowding out of private charity by public welfare–a very old and very serious problem with all state benefits. In brief, why would private associations bother to solve social problems if that is widely understood to be the responsibility of the state? Why should people give generously and sacrificially to charities if they are led to believe that the needs of the poor are being cared for by the government?

The great tragedy of our age is that we have forgotten how to imagine the practical workings of a free and virtuous society. We have lost faith in our ability to solve difficult social problems on our own and, instead, have transferred our faith to public officials to solve our problems for us. Nowhere is this more true than with our Social Security policies. I realize that having a clearer understanding of the social, economic, and cultural costs of the program will not provide us with a blueprint for a seamless transition from the present system to a private one, but it will take us a very long way toward imagining a clearer path for the future, one more compatible with the American ideal of ordered liberty.