The Great Depression was a terrible time for everyday Americans,but particularly devastating for the elderly. In response to this,and at the urging of President Roosevelt, in 1935 Congress passedthe Social Security Act.

This completed the transition from Americans taking care oftheir own retirement in the first century of our nation’s historyto complete dependence on third-party institutions (corporatepensions and now the federal government).

While the original intent was laudable, Social Security hasmorphed into an insatiable monster that’s systematically erodingour financial fitness (see “Social Security – A Promise Breaking?”FiduciaryNews.com, September 12, 2017).

When it started, Social Security was meant to provide retireeswith a few years of supplemental income -- not to cover all theirretirement expenses, but just a minor fraction. Many people like tocite how the worker-to-retiree ratio has shrunk considerably sincethe beginning of the Social Security program.

That’s not the important stat, though, this is: In 1935, SocialSecurity benefits started at age 65, when the average American hadbeen dead for 3 years (for women) or 7 years (for men). Today,benefits start at 62, giving the average American between 14 years(for men) and 19 years (for women) of Social Security benefits.

If we started Social Security today with the same assumptionsused in 1935, the age benefits would start at 84 years.

To give you a sense of scale as to what this age differencemeans, according to the U.S. Census, there were 43 million peopleover the age of 65 in 2012. Of that, fewer than 6 million peoplewere over the age of 85. Stated another way, today one SocialSecurity retiree is supported by only 3 workers.

If the eligibility age were 84, each Social Security retireewould be supported by 21 workers.

Don’t get too impressed, though. In 1945, there were twice asmany workers (42) for every Social Security recipient. So, yes,inflating the benefits age would help restore financial stabilityto the Social Security program, although it still wouldn’t be assolid as it was in 1945.

True, the program would be downright robust from a monetarystandpoint. In 1945, the maximum taxable earnings was $3,000 with atax rate of 2%. Today, the maximum taxable earnings is $127,200with a tax rate of 15%. That’s a huge difference, and one of theprimary reasons why the eligibility age hasn’t increased.

Unfortunately, the trajectory of this trend has been apparentfor quite some time. The U.S. Chamber of Commerce conducted a studyin 1950, extrapolating the then-current trends, and predicted thepayroll tax would be 18% by 2020. They may not be far off.

Of greater interest was a column in 1946 fromCongressman-turned-journalist that exposed the Achilles’ heel ofSocial Security. He outlined how the program could easily devolveinto an unintended Ponzi scheme. Many today describe the Federalgovernment’s retirement benefit as precisely that. While it’spretty clear Social Security was not intended to be a Ponzi scheme,as the worker-to-retiree ratio continues to shrink, it doesn’t takea math degree (or a criminology degree) to see Social Securityproducing the same results as one.

Everyone agrees Social Security is in trouble. To date, however,the only politically correct “solutions” amount to nothing morethan kicking the can down the road. Right now, it’s a slow-motionvideo of a car careening into an inevitable crash. With each lameeffort, that video is speeding up.

The very real question everyone must ask themselves is this:Where will you be when that crash occurs?