The Socialist’s Retirement
I recently read an article in the CBS Connecticut affiliate concerning the low-level of retirement funds for half of Americans at their point of death. The article and the study state that 46% of Americans upon death have less that $10,000 in assets. Honestly, that surprised me with the obsession about retirement. It would be no surprise to read this story in 2022 when the cultural radicals begin to “retire” – since they are the first generation to not embrace frugality as an aggregate. Nevertheless – it got me thinking – what are the incentives and realities to retirement? What does it mean to “retire”? Where did this notion come from?
A quick internet search reveals, as I suspected, that the notion of wide-spread retirement plans came into existence during the latter quarter of the nineteenth century as a part of the Progressive Era. I could break down the specifics of the types of plans and for whom they served – both public and private. However, my point is that this particular entitlement has never been a fundamental pillar and part of society – it has been manufactured and maligned.
Perhaps I look at the idea of retirement differently. My understanding of pensions are that you contribute a fraction of your income during your working years and the company does likewise. That money is then invested on your behalf – largely out of your control. The contract you enter into provides a percentage of your working income for a finite amount of time or upon other termination terms. It can be said the worker contribute a finite number of dollars into the pension, right? Who is to say that the exercise of that pension exceeds the amount the individual contributed – obviously a reasonable assessment would conclude the beneficiary always exceeds what he/she contributed. This is the attraction and the lure of pensions.
You might ask yourself – yeah, what is wrong with that? I suppose I am too much of a rogue independent spirit to think there is something wrong with relinquishing control of my wealth building capabilities to future fund manager’s leadership. Of course they are benevolent stewards of the money, why certainly? Regretfully, I have seen the mis-use and mis-management of company retirement mutual funds and pensions left and right during recent years. The question I have you is – How does that gamble measure against the “evil” concept of private equity, better or worse? A perfect example of this is the largest pension plan in the country – it is called Social Security.
Of course my generation and several previous generation have no knowledge what industrial life was like before 1935. Without Social Security no one would or could retire with dignity, right? The issue that I take with Social Security is it is done by force, there is no form or terms of agreement. If you enter into work that is accountable to the IRS – you pay the Social Security tax. My concern is that the money that I have contributed, and will contribute, to the hollow Social Security “Trust Fund” will not exist in a capacity to provide a positive return on my investment. Mind you an investment I had no choice in entering into. I suppose a basic understanding of the time value of money would convince most that the government is a horrible place to grow your money. The clever premise that what built into the cake was that current workers would pay for benefits at present dollars to past contributors at past dollars. This system is self-consuming. You are only guaranteed to get a rate of return on your investment equal to that of inflation – also known as no growth. Of course this utopic system only works if we all have skin-in-the-game and move regressively forward together, as a collective. For not, could we be allow a choice to return more – that is dangerous and socially irresponsible!
Again – back to my perception of retirement. I full-heartively believe in the American Dream. The dream of endless possibilities and limitless individual prosperance. By the grace of the Almighty God and genuine moral character, any individual can be successful – irrespective of color, creed, or station. A notion that the worthiness of one’s life is measured by what is left to the next generation; this being the meaning to the word ” Posterity” in the Preamble of the Constitution. So how do I, personally, elevate my station in life for future generations? Leaving them an inheritance or burdening them with debt or little to no assets? I will strongly argue that it is only with wealth creation, meaning the retention of income and investments, that any elevation can be done. Certainly there have been Progressive measures put in place to prevent me from accomplishing this – The Progressive Income Tax, The Death Tax, Capital Gains Tax, et al. Do not be fooled there is nothing progressive about these measures – their true intent is wealth restriction through redistribution. Their goal – to keep me in my station – from birth to death.
There should be no doubt that the individual, given the proper education and sovereignty, is the best master of their fate. Our culture should embrace the concept of personal capital accumulation over the selfish and materialistic idolatries currently on stage today. I would advocate the personal autonomy to do what you wish with your money but certainly no government should be given the power to deem what is acceptable or “fair”.
Using your self-generated wealth for your “golden” years is something to be proud of – not ashamed of. The ability to use the interest income to live off of and retain the principle would be an outstanding goal. Private charities and such would thrive with such endowments. Our goal as a society should be to cultivate noble citizens that are humble in nature and philanthropic at heart – instead of attempting to subjectively levy judgement on “fairness” and forced equality with other people’s money.
Stay tuned to future posts where we will further expound on the notices of the Social Contract and their true meanings all the while exposing the flawed premises of the “general will” and “general welfare” tenets.
I will conclude with a quote from William George Jordan’s The Majesty of Calmness as to my outlook on civic retirement:
“You cannot buy a substitution, you cannot win a reprieve, you can never be placed on the retired list, the retired list of life- is death. The world is busy with its own cares, sorrows, and joys and pays little heed to you. There is but one great password to success–self-reliance.”
As always … your thoughts?!?