American Thought Leaders - Is Social Security Reaching a Dead End?–Star Parker

Episode Date: August 30, 2024

“When [social security] was first established, you had 40 workers for every retiree. Today, we have three workers for every retiree. You also have people living longer, and you have all people forced into this system that they don’t own … and they can’t transfer it to their heirs,” says Star Parker. She is the founder and president of the Center for Urban Renewal and Education (CURE) and editor of the book “The State of Black Progress.”America’s social security system is broken, Parker says. And it’s not just social security. She argues that America’s welfare and safety net programs are all built on a one-size-fits-all model that fails to actually help the poor. Instead, they entrench generational poverty in certain communities, she argues.Views expressed in this video are opinions of the host and the guest, and do not necessarily reflect the views of The Epoch Times.

The general society believes that we should have social safety nets. Well, that's not what Social Security is. What we built is this one-size-fits-all program that actually has a disproportionate negative impact on the very poor that we're trying to help, black men. Star Parker is the founder and president of the Center for Urban Renewal and Education, CURE, and editor of the book, The State of Black Progress.

When it was first established, you had 40 workers for every retiree. Today we have three workers for every retiree. You also have people living longer and you have all people forced into the system. All of our welfare programs, over time, they do not work for anyone. That's why we have pockets now of very, very broken communities because we have concentrated poverty in those communities. YANYA KELLER, This is American Thought Leaders, and I'm Yanya Keller. STAR PARKER, Such a pleasure to have you back on American Thought Leaders.

YANYA KELLER, Well, thank you. It's good to be with you. STAR PARKER, We just hit, as we're filming today, I couldn't help but notice, $35 trillion in debt in the U.S. There's talk about interest rates going up, the population is aging, and there's a lot of questions about the social safety net, you know, that that's been erected over time. Is this something we should be concerned about? I think we should be concerned about the social safety net. In fact, one of the reasons that I founded CURE was so that we would revisit that time in American history, in particular black history, to where we got off course from the founding principles of freedom,

personal responsibility, faith. And we started down this course for government to solve all questions about every topic. And so we've just released a tome, a new tome, The State of Black Progress, to look at what has happened as a society for this particular group of people and can America work for this particular group of people, those based in a history of slavery, Jim Crow, and then the next step was a welfare state. But what happened in the process of that is economic realities began to change, including the expansion of what we call social safety nets, social security. In fact, it was in their 30s when there was this insistence that we must take care of the poor as a society. No one wants to not take care of the poor.

That's why we have nonprofits. That's why we have charity. And that's why people of America have always been generous in those areas. But when you try to build out a one-size-fits-all program to solve poverty, then you can run into problems. So for instance, in Social Security, trying to take care of widows and orphans, especially after wartime, you develop out a welfare program, Social Security, and over time it can have unintended consequences. I don't think anybody these days, or it's very rare for people to suggest

that there shouldn't be some sort of kind of guaranteed safety net for people if things happen, right, to people. Life can throw you all sorts of difficulties. And I guess in a compassionate, liberal democracy, I think we generally believe that we should be helping people. I mean, I think you believe that too, right?

I do believe that, but I also believe that we should reevaluate who should be doing that help. I'm one that believes the private sector has all answers to people that have need. However, you're right. The general society believes that we should have social safety nets. Well, that's not what Social Security is. And as we talk about in this particular tome, what we built is this one-size-fits-all program that actually has a disproportionate negative impact on the very poor that we're trying to help. Very disproportionate, because what the system is based in is current workers paying for current retirees. When this system was first developed during the 30s, it was taken to court. A couple people took it to court and said, wait a minute, there's nothing in the Constitution

that says that I can go in your pocket to help somebody else. I'll go in my own pocket and help somebody if I feel that they have need for that help service. But the Supreme Court did rule twice that Social Security was a tax. Congress could change it at any time, and therefore they do. So what has happened over time is Social Security is no longer what we might call a social safety net, which we can also

talk about some of these welfare programs and how they're also not working. But it's not a welfare program. It's an entitlement program. And it's an entitlement program that's taken tremendous impact on our society and our economy. It's 2 thirds of our budget when you add in Medicare and the expenses we pay in Medi-Cal.

So what has happened as a result is the American people have come to believe that this entitlement is something due them, that it's not a social safety net, that this is a retirement plan and an obligation of government to help them in their senior years. Well, the way that it's designed, current workers paying for current retirees, it cannot work over time. You just mentioned what kind of debt we're in. Most of the reason we're in that kind of debt is because we keep this Ponzi scheme going. We keep it going, even though when it was first established, you had 40 workers for every retiree. Today, we have three workers for every retiree. You also have people living longer, and you have all people forced into this system that they don't own. They cannot get a return decent, and they can't transfer it to their heirs.

So I think you started talking, but you called it a Ponzi scheme. I probably shouldn't have. But you know what? If it were a business in and of itself, a corporation, it is illegal for business to do these types of situations that we now have encouraged over time for our government to do. So you're right. It's probably a very harsh term for most people to digest, especially those that are retiring and already have retired. When you think about current workers paying for current retirees, a couple of dynamics happen in our society. Number one, we started seeing marriage collapse and childbearing decrease.

So the pyramid turned upside down. It is a pyramid, and that's why I call it Ponzi, because it technically, if it were another business, like a private sector business, it would be a scheme. You can't do pyramids. It's dependent on this group down here. Well, that group down there is smaller today and it's created a whole lot of social problems for us, but Social Security is one of the biggest ones that most politicians won't touch. Well, so without getting into whether this was a good idea at the outset, it worked

at the outset at some level, right? You said there were 40 to 1, or something like 40 to 1 at the beginning. Right, right. But the 3 to 1, today, that seems like a huge shift. That's an order of magnitude. It is a magnitude, but when you think about can something sustain over time, no, this could never have. So who gets hit the hardest by this particular scenario? Black men. Why? Black men, matching the 6.2% goes into a black hole because they can't transfer it to their heir and they've not really recovered what they put in.

Wow. And most Americans now are starting to feel that. As you get older and you start thinking about benefit, you look at what maybe your 401k gained you and or some other instruments that you may have invested in and then you look at what maybe your 401k gained you and or some other instruments that you may have invested in. And then you look at what Social Security is telling you that you're going to receive from, of course, current workers if they continue to pay into this tax system. And a lot more Americans, younger Americans in particular, are saying, I'm just not sure this is sustainable. And I'm not sure that I'm going to wouldn't have fared better had I put that same money into something, a safe mutual or an annuity.

So, Star, we're going to take a quick break right now, and we'll be right back. And we're back with Star Parker, founder and president of the Center for Urban Renewal and Education, CURE. How much of the budget, obviously it's a very significant portion of the budget, but how much does that contribute to the budget not being balanced, basically? Well, it's untouchable. It is the very reason. So that's why a lot of people don't take politicians seriously when they say, we're going to balance budget, we're going to do all these things, we're going to help your life, we're going to bring down costs of inflation, we're going to bring down costs of your food and your gas.

When you're looking at if you add the three entitlement programs and the interest on the debt, you're talking about three-fourths of the whole budget. So one quarter is what we're really fighting about. And that quarter is split almost equally between defense spending and general welfare, they call it, where those programs are all, I guess you could say, need to be re-evaluated as well, because these types of programs are hurting our economy as well. And we look at that in this particular term. The Center for Urban Renewal and Education, the reason we did this particular piece of

work is because the Urban League, who says that they speak for black interests, have been doing a work every year for the last 40 years or so. But they come to the same conclusions. America's systemically racist. We need to keep going into wealthy people's pocket to give to poor people. Well, we wanted to look and see if that's really true. And so we started a few years ago with the state of black America, Tom, but they sent us a cease and desist. They were going to sue us. So we changed the name to state of black progress just to see, does America work for African Americans? Not only does it work for African Americans, it's one of the reasons that we need to now move the discussions to how do you now own America? You won't burn down Wall Street if you

own Wall Street. You won't have a disdain for capitalism if you were a capitalist. And that's one way to do that, is allow for monies that are being forced into the IRS through Social Security, allow those monies to go into private IRAs or other types of instruments. So you have the 50 under, which includes all of Americans, African-Americans, Asian-Americans, Latino-Americans, white Americans, any and everyone

that are saying, how do I fare better over time and have a peaceful retirement, are now more interested in saying maybe a one size fits all government program is not the best for us. So a layout for me, you know, how this solution looks like you described it briefly earlier. You're basically the money follows the person doesn't go into just a big pot. Is that the idea? Right. Okay, so we have it we've have situations like this already. Okay, we can look into what's happened in school choice movement. It's been years and I've been working in those years, 30 years of trying to get to the reality that the Supreme Court has just given that we can send our children to schools parents won. Of course, you have to battle now in the states to get that but the Supreme Court has just given that we can send our children to schools parents want.

Of course, you have to battle now in the states to get that, but the Supreme Court ruled that it's not unconstitutional for money to follow children to schools parents want. And that has been a dilemma, especially from the progressive left forever, because unions are involved and they want to keep the one-size-fits-all educational apparatus so that they can keep themselves flush. It's the same kind of scenario, money following workers to a place they wanted to retire. But in order to do that, if you're very on the lower end of the economic scale, where do you get that money? Where do you get that money to say, I'm going to invest in my future. Now, most Americans have that opportunity because you can, you know, perhaps not shop as much, not go out as much and start

saving and investing. But the poor, those that are under $25,000 a year, those that are trapped in our most at-risk communities around the country, there's just not that income available. However, there's a pot over here that they are paying. 6.2% of their money, 6.2% of the boss has to match it, and they send it to the IRS. They do not send it to a trust fund. People have bought this idea that there's some big pot that, you know, congressional leaders have just been dipping into and stealing from us. No, there's never been such a trust fund. The Supreme Court ruled twice. It's a tax. It goes into the general revenues. We allocate some over here to Social Security. They send out checks to anyone that

turns 65 or whenever you decide that you're going to retire. Some go 62, some go 67. Now they're trying to talk you into stay longer, stay longer, get closer to your death age because we don't have any money. So they're coming up with all kind of ways to try to convince people that they should postpone retirement. And that type of scenario just cannot last over time, especially with fewer children. Did I mention that we have fewer children? Did I mention that in less than 14 years, all the data is in that we will have more people over 65 than under 18? We'll have more people in this country over 65 than under 18 in just 14 years. That system can't sustain. Well, there is definitely that huge demographic shift

with people having less children for all sorts of reasons. For all sorts of reasons, people have decided to do this in their lives, and we all have opportunity to make those types of choices. But then it begs the question, should we have ourselves in a situation where government then has us in a one-size-fits-all, any type of scenario. We don't just argue at CURE against what we're doing on Social Security and wanting private and personal accounts, but we also argue this on welfare programs. I mean, all of our welfare programs, our so-called real safety net programs, are built on that same model, one-size-fits-all. I lived in that before I got

my degree and started my own business and then began to work in social policy. I had believed all the lies of the left that my life was whatever I wanted it to be. And I ended up on welfare. We can go into all the details of that. But the rules were don't work, don't save, don't get married. And these rules are one size fits all. And over over time they do not work for anyone and that's why we have pockets now of very very broken communities 8,700 of them 20% of our zip codes because we have concentrated poverty in those communities everything their government controls and owns well let's talk about that a little bit basically you're telling me that the incentive structures are set up to have people not get out of that situation.

So maybe just explain that to me. You want a government house? Don't get married. You want to live in a housing project? Don't have a job. Come on. But do people really want to live in those places? Not really. I mean, over time, you can get on. But do people really want to live in those places? Not really. I mean, over time, you can get on this treadmill, if you will. And if you're relatively poor and the society says, well, we're going to help you, but we're not going to help you personally.

We're going to help you through a one-size-fits-all government apparatus. Then you go in to apply for that apparatus. And the next thing you know, you have to start decreasing your life you have to drain your life in order to get on Medicaid you have to make sure that you have no investment in your health plans in order to get on welfare you have to make sure that you have no investment in any place including in income if you work in a job they're going to take what you made on that job and put it back into the coffers if you're on a food stamp program you have certain requirements.

They're called means tests, and every government program has those means tests, but the means tests are negative. They severely impact the poor. That's why they're trapped, and now it's generational, because once you get in the system, it's incredibly difficult to get out, because every time you try to move yourself upward,

you're penalized by the very system that says they want to help you. It's incredibly difficult to get out because every time you try to move yourself upward, you're penalized by the very system that says they want to help you. What do you mean the means test is negative? The means, don't work, don't save, don't get married. Those are means tests. I see. If you have an able-bodied worker in a household, you are not going to qualify for certain benefits. If you work in those poor households, you are not going to qualify for certain benefits. If you work in those poor households, you are not going to qualify for certain benefits.

If you have any savings, you are not going to qualify for certain benefits. So you have to drain your life. Now for people that come in with nothing, you come in with nothing, but you will never have anything. There's no ownership in a housing project. There's no ownership in anything. And especially if you're now even dependent

on government for transportation, if you then say, well, maybe I should go to school, you're penalized. Maybe I should go get a job, you're penalized. Now, we changed some of those rules during the 90s under the leadership of Newt Gingrich and Bill Clinton signed welfare reform into law after 60 years of having it just that way. But it's still very difficult. I worked as a consultant on that project, but it's difficult because a lot of the bluer states don't like those rules. They don't want work requirements. They don't want time limits.

So they change the rules a little bit. They make things a little bit more flexible for people to just stay trapped in government. Is it because they feel like it's being too hard on the people? What is the thinking? It's interesting you would ask that question. In this particular tome, The State of Black Progress, Judge Janice Rogers Browns looked at that very question of a natural law. Do we believe people have the capacity to self-govern? So I think that there's this insistence of the elite that there are certain people that

just cannot manage their own lives. They don't have the capacity. They're looking through their own lens to say what they're not rocket scientists, therefore they have nothing to contribute. And so it's almost like it's a demeaning outlook on life for the poor and those amongst us that may be started with less. So it's a question for all of our society if we're going to do anything about these entitlement programs and our social safety net programs that are totally draining and killing our country. If we're going to do anything about it, the first question is do we think they have the capacity? Can they do something? Can any child learn to read, for instance? Why is it that so many fourth graders that are trapped in these zip codes where nothing works except government,

why can't they read? Why is it that other fourth graders can read and it doesn't matter what ethnic background you're from even though these social engineering programs have disproportionately hurt black people they've hurt black people because black people came out of slavery through Jim Crow through Jim Crow to a welfare state and so this is a very challenging decision that people have to make do I try to get something or do I live off the promises of government? So that would be the first question people have to ask. Do you believe that people have the ability to self-govern? Do you believe that people have the

capacity to do anything, just anything? And if we do, then we would be more benevolent when it comes to our own personal interests and our own personal passions than to try to build out one size fits all government programs or let them just continue to feed off of themselves, which is not only draining the budget, it's draining the human capacity of those very individuals that we keep saying we want to help. We should have flexibility and mobility. And the only way to do that is to move all of these so-called safety net programs to the states. Let them decide. Let's build out community based on location as opposed to a one-size-fits-all from here in Washington where $7 out of $10 that comes in here goes out immediately to a person through a program. Because then I guess you're suggesting that you could see the impact.

Well, you'll see the impact and you'll know, yeah, you'll not only see the impact. If it's working at all. I mean, look at this monster of HUD. Most people don't even know what it does. And we have to ask ourselves, is it working? Look what happened in homelessness. When homelessness was over at HHS, Health and Human Services, which is if you believe that homelessness is a human problem then that's where it belongs but

when Barack Obama came to town he believed it was a housing problem so he moved the budget to HUD and the budget's unbelievable and it's destroying entire populations and cities so you can't have a program just says they all just need a place to live you have to know no some are really drug addicted some are alcoholics some are economicallyressed. But others have mental incapacitation. Some are just lost. So we have to be able to segment that way. And that's only, the best place to do that is very, very local and very, very private through our charity programs.

Tell me a little bit more about your background. I'm very, I'd like to kind of recap that for our viewers who haven't been with us as long. Well, you know, I came to a lot of these ideas just because of my own personal experiences and bad choices that I was making after believing the lies of the left all through my junior years, and I guess preteen and teenage years, that America was racist, I shouldn't mainstream, that my problems were somebody else's fault, that I was poor because others were wealthy. And when you keep hearing this over and over and over again, you tend to believe it. And so you just kind of distance yourself from any type of desire for better, desire for purpose, desire for any kind of meaning in your life. So I just got caught up in

everything, reckless living, you name it, criminal activity, drug activity, sexual activity, abortion activity, welfare activity. And then God saved me. I was going to get a, I was trying to subsidize my welfare check. And I walked into this business trying to go get a little job where they would just pay me under the table so that I didn't have to tell my caseworker because if you, because if she found out, then I would get penalized. So I wasn't making anything. I was just working instead of watching TV. And so why, who wants to do that? So I was hoping that they would give me a little money on the table, and they didn't. Instead, they introduced me to the Lord. And that was the best decision I could have made to start refocusing on myself

to be responsible with the choices that I was making, to believe that I really did have the capacity to self-govern, that I have agency, that I have destiny. And once you start believing that and you start investing in that part of everybody's life, you'll start seeing growth. And it doesn't matter whether you're a homeless person, former drug person seeing it. The first way that you solve a problem is admit you have one. And that's something government can't do for somebody.

And we don't want them to. Government is to protect our interests, not to plunder our interests and not to pick winners and losers about those interests. Well Star, any final thoughts as we finish? Well I'm trying to think of everything that we said in our tone but it's a really thick book so I'm hoping everybody will go out and get it because I think that it's important, especially people looking in from outside of a community of people and looking in to where this discussion has always come from the left to say how we should think about the journey of African Americans. We have many a holiday.

We have many of everything. We have many of that, many of this. And it's good to hear the alternative side. You know, when you hear that there's another position, it will help build more continuity in our society, I believe, because then people will look at their neighbor very differently or look at our inner cities very differently to think maybe we can fix it. And that's what I want, a better attitude about helping people help themselves. So Star Parker, it's such a pleasure to have had you on. Thank you. I really appreciate being here with you.

Thank you all for joining Star Parker and me on this episode of American Thought Leaders. I'm your host, Janja Kellek.