Sunday, January 11, 1998

Not the time to hit the panic button

By Ken Hargis

It is not a "Social Security mess," and nobody has acted like "drunken sailors with our precious, hard-earned money." So, just for the record:

-- Alan Milne states in his Jan. 2 letter that he has "unwillingly contributed in excess of $300,000 to the federal government." Perhaps he has, but only a fraction of that amount could have been paid in Social Security taxes. Milne states that at age 50, he has worked since age 16.

If a person worked for wages during those 35 years and paid FICA taxes on the maximum creditable amount (and Medicare taxes on the same amount), then the taxes paid amount to $71,766.54. That's a lot of money, but it is $228,333.46 short of $300,000.

-- Milne is correct when he says some Social Security funds are loaned to the federal government. Then I think I get confused. Remembering that Social Security has reserves in the billions of dollars, what should be done with all that money?

Maybe lock it up and don't let anyone use it, don't get any interest on it? That does not appear to be fiscally responsible. Maybe put it in each person's own individual account and pay only their benefits out of their account? Seems good, but what happens when all the money in their account is gone?

Do we stop their retirement check? Or their disability check? Or their children's check? Maybe it doesn't sound so good after all.

The way it does work:

Social Security collects billions of dollars in interest each year. Yes, there are IOUs -- backed by the same government that will cash your IRS refund, your savings bonds and your treasury notes.

It is true that Social Security has some financial problems and changes will be necessary. But it is not time to panic and make crisis-like decisions.

It is time for all generations to express their opinions and their expectations. As we change the system, let's change it responsibly and for the better.

Kenneth Hargis is Field Office Manager of the Social Security Administration in Abilene.