A rare political comment

Megan McCardle has some typically insightful things to say about national debt under the headline "How Should the U.S. Break Its Promises?"

She means money promises and she is not advocating that it should but discussing which promises should get broken first if it comes to that. And the key paragraph, the one you should print out and tape to your bathroom mirror soyou have to read it every day is this one:

The first thing to point out is that legally, changing social security benefits would not be default, because (as the Supreme Court has already ruled), beneficiaries have no legal, contractual right to their benefits.  They enjoy them at the sufferance of Congress, and Congress has the perfect right to change them.

Let me repeat that: no one has any legal right to social security.  McCardle says the Congress has the right to change benefits paid out and that is right but, just so we all understand, Congress has the right to change them to zero dollars and zero cents starting tomorrow if it wants. If you read the whole thing, you will find she has a lot of fascinating things to say about the lack of financial consequences of Congress doing so.

And a very similar situation obtains in Canada where I live.

Now you may say, who cares about what Congress has a legal right to do as it would be political suicide and therefore it will never happen? Well, it would be political suicide right now but I wouldn't quite say never here.

I have about twenty nephews who are graduating into a brutal job market right now. They are making some damned hard compromises as a result. People qualified for serious research work are going into sales jobs. And they will be paying big taxes all their lives to support social security they have very little chance of benefiting from.

If you are under fifty-five years of age, you may want to think the dynamics through pretty seriously here. Because the demographics here favour people in the first half of the baby boom but they are going to shift brutally against those of us in the second half. And Gen Xers well, they have been complaining all their lives anyway so ....