Rand Paul on Social Security

Summary

Rand Paul does not believe that the social security system, as currently implemented is sustainable. He believes that those paying into the system now, will be faced with higher retirement ages and lower overall benefits in the future. The reason for this is that the government has spent the money from the social security trust fund. To prevent this from happening to future generations, he has proposed privatization or allowing people to opt out of the system. 

Social Security is a Ponzi Scheme

Throughout the late 1990s, Rand Paul was a frequent guest on a Kentucky television show debating politics. In one of those debates, he discussed the fact that those paying into social security now were not likely to see a return on that payment. He also noted that the system is functioning in the same manner as a ponzi scheme, where income from new enrollees is funneled to older members. The system collapses when the number of new enrollees is less than older members.

Lack of workers in social security

In a May 2010 interview with Real Clear Politics, Rand Paul spoke about the looming problems with social security and the low numbers of workers

KING: If we don't deal with Medicare and Social Security, you don't get to the big picture here. What would you do? How high would you raise the retirement age, for example? And what about Medicare for the next generation, not those who are on the verge of retiring but for the next generation? What should -- what would they look forward to if you had your way in Washington to a new Medicare program.

PAUL: Well, I think it's sort of like being an alcoholic. The first thing you have to do is admit you have a problem. And Washington needs to admit that they're sort of an alcoholic drunk on spending. We have to admit that Social Security and Medicare have demographic problems. There used to be seven workers for one retiree and for many years there was a surplus.

But now, for the first year, Social Security will spend more than it takes in and that's a real problem. So, you have three choices. You either keep borrowing the way we've been borrowing. I don't think that's a good choice.

Or you raise taxes. Some think tanks have said you might have to have a 40 percent payroll tax. I think that's crazy and I won't vote for that.

Or you look at eligibility over a long period of time, mainly people who are not close to retirement age. But you do have to do this.

Voting Record

Temporary Payroll Tax Cut Continuation Act of 2011

In February of 2012, the Senate voted on accepting the conference report for the Temporary Payroll Tax Cut Continuation Act of 2011. The legislation extended unemployment benefits, forced a decision on the Keystone Pipeline project, and provided for certain medicare levels. Mainly, the legislation continued the 2% employer side reduction in payroll taxes for social security. This reduction is funded by bringing money into social security from the general revenue fund, thus adding to the debt. The legislation passed the Senate 60-36. Rand Paul voted against the legislation.

Sponsored and Cosponsored Legislation

This representative has not been identified as sponsoring or cosponsoring significant legislation related to this title.

References

[1] Website: Real Clear Politics Article: Interview with Senate Candidate Rand Paul Author: NA Accessed on: 07/15/2010

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