Over the past two weeks, I’ve taken brief looks at four programs that I predict will receive (or need to receive) substantial amounts of money from the government in the near future.  It all started with the Postal Service, which is bleeding so much red ink that it seems multiple bailouts will be a certainty in the coming years.  From there, I looked at the Department of Homeland Security, which seriously needs to reevaluate the way they spend our tax dollars in the name of keeping us safe.  Then I looked at the Public Library and Public Education, both of which need to get with the times and reexamine the way things are done to stay cost-effective.

In all of these posts, I was careful to note that these are “off the top of the noggin” ideas, and are meant more to start a discussion than as final solutions to our problems.  The purpose is to illustrate that we will need to keep an open mind if we ever wish to get government spending under control -- and that this is not necessarily a bad thing.  And I reiterate that today, as I turn my sites on Social Security.

No discussion of government spending would be complete without taking a look at Social Security.  The program takes up over 20% of the federal government’s budget on its own, and that percentage will only increase as America’s population ages demographically.  If you are worried about how much money the government spends on interest each year, then you should be at least equally concerned with how much we spend on Social Security.

The problem with attacking Social Security, aside from the fact that is makes you massively unpopular with the subset of the population that actually votes on the regular, is that a large number of people rely on it right now.  This is not some future benefit that they’re looking forward to.  This is something that means the difference between solvency and bankruptcy right now.  To cut it across the board is simply not feasible.

Of course, this is not the case for everyone.  Social Security comes to you whether you need it or not.  It cannot be denied, although if you really feel strongly about not needing it then I’m sure you could make a donation to the government for the same amount you received each year.  So that might be a nice place to start -- make Social Security voluntary to receive (and only to receive).  Many well-off Americans might take it as their patriotic duty to turn the money down, keeping the program just a little further from the chopping block.

Not like that would make an enormous difference, but every little bit helps (a lesson the government could really stand to learn one of these days).  Another possible solution would be to adapt Thomas A. Firey’s idea for reducing future pension costs by offering people who have not yet begun to receive benefits a buy-out.  Most people prefer income now than in the future (especially these days), and the government might be able to significantly reduce the number of future beneficiaries while maintaining the same number of people paying into the system.

Finally, we need to admit that the entire premise of Social Security is not as efficient as it could be.  We are paying premiums now to cover the current payments to beneficiaries.  This worked many years ago, but the demographics of the nation have changed rather dramatically.

We need to find a way to transition towards putting the money paid now into interest-earning accounts.  This transition might result in a temporary increase in the money required to pay Social Security payments, but will solve the problem entirely in the long term.  And if the government plays its cards right during this temporary increase by making good use of the ideas above (and maybe comes up with a few more of its own) then there may even be no need to raise taxes or drastically cut spending in other areas.