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mothballedyesterday at 3:41 PM1 replyview on HN

The Social Security system relies on creating a debt of unborn children to older people based on those older people having already paid now dead people, so keeping it solvent requires more meat for the tax machine.

A pyramid inversion means the old keep voting for OPM from the young, using their numbers to crush them, meanwhile there are fewer and fewer young to actually pay it. Eventually creating instability, couple this with entitlement "I paid that dead guy, so that kid owes me!" (of course, abstracted, as "the government owes me" to hide the kinetics) and you are in a bad spot.

---------- edit: reply to below since I am throttled -----

yes under any system youth are needed. But SS creates a tragedy of the commons. Because retired get benefit obligation of children whether they have/adopt/foster the children or not. In most other systems, the link is more direct, so there is greater incentive to have or adopt child and provide investment in the child, as their success is directly linked to yours. In SS system you can reneg on most of the responsibility of creating the engines of the next generation but still simply scalp that investment off someone else, and indeed still get roughly the same share without making the investment. Obviously there is great moral hazard to simply scalp the benefit of children without having to make the investment yourself, and SS is all to happy to provide that.


Replies

anonymarsyesterday at 3:52 PM

Mentioning Social Security and government implies there is some other form of retirement that doesn't inherently depend on younger people still working, doesn't it? I mean, who else going to grow the food and sweep the streets?

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