The working class in America (specifically the lower segment) is surprisingly opposed to social protections, which is strange considering they live in the wealthiest country in the world while also being the most unprotected among Western democracies.
Social protections are something that not even conservative parties in Europe can challenge (at least for now, we’ll see if the US trend spreads there though).
As a European who has spent a decade in the US and has always had a speech for expanding the social safety net (and, BTW, I’m on the fortunate side of US society), it seems impossible to me that some people will ever understand this, especially and shockingly, those who need it the most.
This is the center of every issue in America that people need to understand. Poverty is seen as personal failure. You were lazy or a bad person thus you are poor. By that token, the rich are moral, just, and what we should aspire to be. But the biggest Trump supporters are the biggest consumers of welfare and social services, how can that be? It's not their fault! It's the blacks,immigrants,gays,trans,dems and whatever boogeyman we need that are causing their suffering. Vote for us and we'll solve that and you too can be rich and powerful.
> it seems impossible to me that some people will ever understand this, especially and shockingly, those who need it the most.
After many years of denying it, I've come to the realization that to solve social welfare in the United States we need to first solve racism and religion. So I agree it seems impossible.
What do you mean when you say we need to "solve religion?"
I don't mean my question to come across as combative or challenging, I just don't understand what you have in mind.
> The working class in America (specifically the lower segment) is surprisingly opposed to social protections
Probably because we stopped distinguishing between the hard working poor and the indolent poor, among other reasons.
Nobody trusts the government not to throw the money away giving it to their friends who administer NGOs, or staff up huge offices of administrators, or give it away to encourage lifestyles the majority disapprove of strongly enough that they’re willing to go without themselves to prevent it.
> The working class in America (specifically the lower segment) is surprisingly opposed to social protections
It is not that they are opposed to social protections. It is just that the Republican party has succeeded in distracting them with more important topics: Guns and Jesus.
> the Republican party has succeeded in distracting them with more important topics: Guns and Jesus
Trump voters were not significantly moved by these sells. The pushes were immigration and anti-wokeness, the latter intentionally ambiguously defined. (Compare Graham’s earlier works to this self-congratulatory nonsense [1].)
> (specifically the lower segment) is surprisingly opposed to social protections
They are already in a weak social position and were taught that asking for any kind of protection or assistance is a bad thing. The last thing you want when society is already looking down on you is give more reasons for it.
There's certainly a cultural element that a certain sector of society has been enabling to prey on. That's why Bernie Sanders was so important; for the first time, someone was telling all of these struggling workers that they weren't the problem and didn't have to be ashamed.
> working class in America (specifically the lower segment) is surprisingly opposed to social protections
A lot of social protections for them were shams. Worker retraining after signing NAFTA, for example. Unions that turn into hereditary job pools outsiders can’t break into. Hell, public-school taxes for universities they can’t afford because their public-school teachers couldn’t teach their kids math.
I don't really know how to tell you this delicately, but you're in an information bubble.
If you have to go reaching back 30 years to a jobs program for an example of a sham social protection program, they are probably in great shape (a jobs training program isn't even really a social protection).
I know some unions have nepotism problems with jobs in the union (which is different than union jobs). I wonder if they are particularly worse than other political arenas though, where many value loyalty and control more than merit. And, of course, unions are not social protection programs. They are a response to the lack of social protections.
School funding isn't even tangentially related to social protections.
But many other social protections - the comparatively huge ones - are ones that workers value a lot: Unemployment Insurance, Disability benefits, Medicare, Medicaid, Social Security.
But unfortunately many workers have taken those as a given and therefore untouchable, rather than a societal choice.
In order to save, you need to earn enough to do so.
The average salary in the U.S. is $66,622, and the average household income is $80,610.
The average housing cost is $2,715 per month, or $32,580 a year. Average food costs for a single person are around $9,000 a year. Average total utility costs are $7,200. Average healthcare costs per person are $14,570. Average car ownership costs are $12,182 per year.
These average expenses total $75532 per year, meaning the average single person with an average salary is $8910 in debt. You can do the math for the average two-car household yourself.
And we haven't even accounted for taxes. Or the costs of raising a child.
Now, admittedly, this average person/average houshold most likely does not exist. But simply looking at averages points out the problem that most people are already stretched financially too thin to stock away something for retirement.
Over half the United States population earns less than $100k a year, and the median income for all earners (the middle point, right smack in the middle of all earners of all ages and genders) is roughly $40k.
I'm sure all you folks earning over $150k a year with stock options are doing fine, but realize you guys are in the top 20% of income earners in the U.S. whether you feel like you are or not.
66k/80k for income sounds like a median, whereas $2,715 sounds like a mean housing cost.
A quick search found between $1,500-$2,000 a month for median rent prices.
If you adjust for a $1,600 rent, your above person is left with 3k, before considering that all the other expenditures are absolutely insane.
Options:
- Live in a city, ditch the car. This gives you a $2,600 rent budget under the same other expenses.
- Eat less expensive food. $9,000/year (>$8/meal) for food for a single person is high. No takeout.
People like to pretend the situation is worse than it is - some people have it bad, but tighten your purse and live less lavishly. Work on getting a better job (if you need to or can), and when you make more money don't increase expenses.
I think it takes a bit of a mindset shift. If your salary is $X, you can't start your expense plan with how much your apartment costs. There are expenses A. that are ironclad-mandatory, in that you must make them or you're really fucking yourself: Taxes and debt interest are examples. They need to come out of your salary before any other calculations are done. Your actual income (that you can spend) is $X-A. Then you have B. expenses that you have to pay, but you have at least theoretical control of by shopping around, like the cost of your apartment, cars, child care, groceries, and so on. Those come out next. Then, you have C. discretionary spending, everything left over. Often this is zero or negative :(
Too many people put retirement savings in bucket C, where it actually should be considered bucket A. It needs to come out before you even consider anything else. Your money left over after taxes, paying interest, AND savings, is what you have left to decide whether you can afford this apartment or that car.
I think there are a lot of people for whom this is true, but also a lot of people for whom this is terrible advice. Your not likely to reach retirement age if you take your retirement savings out before your apartment or food and wind up evicted or starving.
I think you've overstated housing costs, as crazy as that sounds. The places with really high rent pay more and also see people get with roommates. So the average rent/mortgage is not the same as the average person's housing expenses.
Most people cannot afford to save a lot of money for retirement, especially while paying into Social Security or other government programs. But that has never been possible in the entire world, and it generally still isn't. Even in cases where it was, such as the boomers, it still didn't really happen. To be fair the boomers fully expected that their taxes would go toward Social Security in their old age.
Americans will do anything but remove the cap on taxing income over $176k.
It's a bizarrely unique American notion that those who can most afford it are given the exemption and the burden falls to those who can least afford it. And that those who profit most from the system are given a pass on having to actually pay for it.
Income over $176k is definitely taxed, at progressively higher marginal rates. If you won the lottery you'd lose half of the jackpot to taxes. Only one specific type of tax has a cap, not that the buckets really mean anything. Courts have found that Social Security is not an entitlement, it is a welfare program. You can collect more than you ever paid in, and be denied benefits for arbitrary reasons. However, practically speaking, they treat it like an entitlement in that paying in more money generally increases the amount of your benefits, up to a limit. If people were to be denied benefits on a large scale, then people paying into it might vote to eliminate it.
> Americans will do anything but remove the cap on taxing income over $176k.
Point taken, but just to be clear to folks who aren’t familiar with American taxes, this cap is only for “social security tax” and does not apply to federal income taxes.
This problem is unsolvable, because we don't want to solve it. Social Security is under attack, while keeping 23 million people out of poverty and being one of the most efficient value transfer and benefits system in the world. We don't want to raise taxes to improve funding for it. Wall Street is chomping at the bit to get access to worker retirement funds. Pensions are unpalatable, even though they could be accomplished with Australia's superannuation model, and are necessary for workers to get investment cashflow to obtain exposure and fiduciary management of the investments.
Broadly, wages are too low relative to living expenses, so people can't save on their own.
There's probably an argument that social security actually subsidizes low wages, as is often made with Medicaid. That isn't to say that we shouldn't have social security -- it's that it should be funded by corporate profits, shareholder returns, and executive pay.
in the USA, most expenses related to raising a family got increasingly expensive, probably because aggressive business models saw that those are "essential" so people will have to pay. That is the logic that got us to plus-fifty percent of household income going to rent and food here in California. The investors in rental units are making a fortune. It is uncontrolled predatory capitalism playing out.
The only reason we are in this situation is extreme wealth inequality. And the only way to fix it is to tax the wealthy appropriately.
We are currently taxing the young when they already are struggling on every front as compared to the previous generations. This problem will only get worse.
What a just society would do would be to add taxes to the wealthy and raise income for the poor, slowly and gently transferring wealth from the rich to the poor in a way that doesn't destroy the system.
The fact that not only are we not doing that but that we are violently opposed to doing that is a fair weather barometer of our current justice quotient.
Social Security only applies to the first ~$176k of your income (inflation adjusted annually). What percentage of young people are at that income level? This is not young vs old, but the median vs the very wealthy.
Intentional or not, this is a bad misdirection. Young people do not have enough income to tax. Those making half a million or more can bear a sharp increase in their tax burden.
Private equity. Only ~4300 US companies are public, so money managers want to juice management fees by expanding accessibility into alternative asset classes.
He's talking about social security revenue. Obviously, the government is much better at this than your 401k plan even though they pissed away decades of surpluses by buying treasuries with them that would require the government to massively increase future taxes to ever be able to pay those back (let alone with interest). Instead, he would prefer, I suspect, that social security withholdings be increased, taxes increased, all so that 23 million people can continue to receive poverty-level checks of $1950 a month, though you won't be allowed to collect yours until you're 70 or older.
Social security doesn't work though, unless there are a dozen workers paying into it for every retiree, and no one's having enough children for that to ever be the case again.
> We’re apparently fine raising taxes if we just call them tariffs.
Of course, because the current tariff strategy is intended to be a regressive sales tax targeting the broad populace who is already being extracted from, to avoid income tax increases.
> Then press secretary Karoline Leavitt told reporters directly that if Canada wants to avoid tariffs in the future, it should become the fifty-first U.S. state. She revealed it: Trump’s tariffs aren’t about fentanyl or any supposed unfair treatment of the U.S. They’re about forcing Canada, with no justification whatsoever, to submit to his will.
"Pensions are unpalatable". You don't have pensions in the USA? Meaning like an account into which you can put pretax money and in exchange you can't take it out until later in your life (but can invest it)?
A "pension" means an employer-funded pool of money that pays out fixed payments after a certain age. What you're describing exists (somewhat unevenly) in the US, but it's employee funded. The employee must take active steps to contribute, which means they lose part of their income until they retire and there may or may not be employer contributions. People who can't afford to contribute, or put it off for a few years (most people) end up with insufficient funds at retirement, which becomes a social problem.
We have tax advantaged retirement accounts, which have weird contribution rules that assumed companies would replace spending they were doing on pensions with contributions to these accounts (spoiler alert: didn't happen) that keep contributions limited to pretty low levels unless your employer kicks in huge amounts, which almost none do (that is, there are limits on what you can contribute, and separate limits on what your employer can contribute, and the latter is significantly higher). Also some of them require your employer to have such a program, or else you can't participate, which further limits your max contributions if yours doesn't.
Further, since individual contributions aren't mandatory, that money is freed up for zero-sum competition over things like good schools for your kids (that is, housing in good districts) so if you don't choose "defect" and spend the money instead of saving it, your family's overall worse off than it would be if everyone had to contribute.
Also, a tax-advantaged savings/investment account isn't the same thing as a pension.
we have a concept called a 401k (and for non-profits a 403b). You contribute some % of your paycheck and your employer matches some amount of that (potentially with a vesting schedule)
The money can be invested, and then at some age (55.5 i believe?) you can access the money without being taxed. There is a maximum you can contribute per year etc etc.
I am not old enough to ever have had a pension option in my entire life, but I believe 401Ks are overall worse, because pensions come w/ some amount of guaranteed payout + someone managing the fund to ensure that happens. a 401K can go to zero, and you can forget to contribute (and most of the money is your own money anyways)
I think we should revisit the policy of an actual forced savings account - rather than the bad proxies for it: social security, home equity, 401k.
The general population is not smart enough to understand a 401k and raids it as soon as they can.
The Obama administration was big on the “gentle nudge” policies - so that for example they would enroll you in retirement, but you could opt out, but I don’t think that’s strong enough.
Forced savings is someone else saving for you. How would you feel if I ran your savings and then screwed it up? Or if you had a once in a lifetime investment opportunity and I wouldn't let you dip into your savings? Or a once in a lifetime calamity and I said no, you can't touch it?
Firstly you'd rightfully realize that whatever I said they weren't your savings, rather it was my money that I was agreeing to let you have at some future date. Secondly I would come to the same realization.
>I think we should revisit the policy of an actual forced savings account - rather than the bad proxies for it: social security, home equity, 401k.
I think social security is a far better setup than forced savings account. The fact that it's much harder to raid, that it's not really 'your money' locked up somewhere is a big reason why it has lasted as long as it has.
Removing that money from contention over things like housing would be great. As it is, you either save for retirement and send you kids to worse schools than you could if you spent it instead, because other people are choosing to bid up housing rather than save for retirement, or you join them and don't have enough for retirement.
"Forced savings account" is a bad proxy for a public pension. Why, for instance, do I need to bear the risk that I might live to 100, and therefore have to save for living to 100 even though statistically I'll probably die before 85?
A public pension is a "forced savings account" that pools a whole bunch of risks together across the entire population. It's forced savings plus an insurance policy.
Now someone will probably say that everyone should be forced to save with a private account and also forced to carry "old age insurance" or something, but hopefully people can see that's just a public pension but worse, because you're at the mercy of middle men and grifters.
There is a significant need for a lower cost of living and wage increases to even entertain the notion of retirement savings first. Get back to me when you solve that problem first.
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Social protections are something that not even conservative parties in Europe can challenge (at least for now, we’ll see if the US trend spreads there though).
As a European who has spent a decade in the US and has always had a speech for expanding the social safety net (and, BTW, I’m on the fortunate side of US society), it seems impossible to me that some people will ever understand this, especially and shockingly, those who need it the most.
After many years of denying it, I've come to the realization that to solve social welfare in the United States we need to first solve racism and religion. So I agree it seems impossible.
Probably because we stopped distinguishing between the hard working poor and the indolent poor, among other reasons.
Nobody trusts the government not to throw the money away giving it to their friends who administer NGOs, or staff up huge offices of administrators, or give it away to encourage lifestyles the majority disapprove of strongly enough that they’re willing to go without themselves to prevent it.
It is not that they are opposed to social protections. It is just that the Republican party has succeeded in distracting them with more important topics: Guns and Jesus.
Trump voters were not significantly moved by these sells. The pushes were immigration and anti-wokeness, the latter intentionally ambiguously defined. (Compare Graham’s earlier works to this self-congratulatory nonsense [1].)
[1] https://paulgraham.com/woke.html
They don't decrease poverty. They increase dependence on the government, and they are funded by money that is taken from you at gun point.
They are already in a weak social position and were taught that asking for any kind of protection or assistance is a bad thing. The last thing you want when society is already looking down on you is give more reasons for it.
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A lot of social protections for them were shams. Worker retraining after signing NAFTA, for example. Unions that turn into hereditary job pools outsiders can’t break into. Hell, public-school taxes for universities they can’t afford because their public-school teachers couldn’t teach their kids math.
If you have to go reaching back 30 years to a jobs program for an example of a sham social protection program, they are probably in great shape (a jobs training program isn't even really a social protection).
I know some unions have nepotism problems with jobs in the union (which is different than union jobs). I wonder if they are particularly worse than other political arenas though, where many value loyalty and control more than merit. And, of course, unions are not social protection programs. They are a response to the lack of social protections.
School funding isn't even tangentially related to social protections.
But unfortunately many workers have taken those as a given and therefore untouchable, rather than a societal choice.
The average salary in the U.S. is $66,622, and the average household income is $80,610.
The average housing cost is $2,715 per month, or $32,580 a year. Average food costs for a single person are around $9,000 a year. Average total utility costs are $7,200. Average healthcare costs per person are $14,570. Average car ownership costs are $12,182 per year.
These average expenses total $75532 per year, meaning the average single person with an average salary is $8910 in debt. You can do the math for the average two-car household yourself.
And we haven't even accounted for taxes. Or the costs of raising a child.
Now, admittedly, this average person/average houshold most likely does not exist. But simply looking at averages points out the problem that most people are already stretched financially too thin to stock away something for retirement.
Over half the United States population earns less than $100k a year, and the median income for all earners (the middle point, right smack in the middle of all earners of all ages and genders) is roughly $40k.
I'm sure all you folks earning over $150k a year with stock options are doing fine, but realize you guys are in the top 20% of income earners in the U.S. whether you feel like you are or not.
A quick search found between $1,500-$2,000 a month for median rent prices. If you adjust for a $1,600 rent, your above person is left with 3k, before considering that all the other expenditures are absolutely insane.
Options: - Live in a city, ditch the car. This gives you a $2,600 rent budget under the same other expenses. - Eat less expensive food. $9,000/year (>$8/meal) for food for a single person is high. No takeout.
People like to pretend the situation is worse than it is - some people have it bad, but tighten your purse and live less lavishly. Work on getting a better job (if you need to or can), and when you make more money don't increase expenses.
Too many people put retirement savings in bucket C, where it actually should be considered bucket A. It needs to come out before you even consider anything else. Your money left over after taxes, paying interest, AND savings, is what you have left to decide whether you can afford this apartment or that car.
Most people cannot afford to save a lot of money for retirement, especially while paying into Social Security or other government programs. But that has never been possible in the entire world, and it generally still isn't. Even in cases where it was, such as the boomers, it still didn't really happen. To be fair the boomers fully expected that their taxes would go toward Social Security in their old age.
It's a bizarrely unique American notion that those who can most afford it are given the exemption and the burden falls to those who can least afford it. And that those who profit most from the system are given a pass on having to actually pay for it.
Point taken, but just to be clear to folks who aren’t familiar with American taxes, this cap is only for “social security tax” and does not apply to federal income taxes.
The wheels will keep coming off the cart.
https://www.gao.gov/financial-security-older-americans
https://www.visualcapitalist.com/a-visual-breakdown-of-who-o...
https://en.wikipedia.org/wiki/Superannuation_in_Australia
Broadly, wages are too low relative to living expenses, so people can't save on their own.
There's probably an argument that social security actually subsidizes low wages, as is often made with Medicaid. That isn't to say that we shouldn't have social security -- it's that it should be funded by corporate profits, shareholder returns, and executive pay.
We are currently taxing the young when they already are struggling on every front as compared to the previous generations. This problem will only get worse.
The fact that not only are we not doing that but that we are violently opposed to doing that is a fair weather barometer of our current justice quotient.
https://www.ssa.gov/benefits/retirement/planner/maxtax.html
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What do you mean by this? My 401k is.... publicly traded stocks? What am I missing?
Private equity to lobby Trump for access to savers’ retirement funds - https://www.ft.com/content/dddd1752-789a-40b6-9aa8-d7cf6f408... | https://archive.today/HrDgt
The stock market is shrinking and Jamie Dimon is worried - https://www.cnn.com/2024/04/09/investing/premarket-stocks-tr...
Shrinking public markets mean growth in private markets - https://fsinvestments.com/fs-insights/chart-of-the-week-2024...
Interesting fact: As of the end of 2024, the Magnificent Seven stocks made up 35.4% of the S&P 500's value.
Social security doesn't work though, unless there are a dozen workers paying into it for every retiree, and no one's having enough children for that to ever be the case again.
Key word: “for it.” We’re apparently fine raising taxes if we just call them tariffs.
Of course, because the current tariff strategy is intended to be a regressive sales tax targeting the broad populace who is already being extracted from, to avoid income tax increases.
Edit: It's also about control it appears.
Trump Press Sec Accidentally Blurts Out Real Goal of His Tariff Scam - https://newrepublic.com/article/192391/trump-press-sec-accid...
> Then press secretary Karoline Leavitt told reporters directly that if Canada wants to avoid tariffs in the future, it should become the fifty-first U.S. state. She revealed it: Trump’s tariffs aren’t about fentanyl or any supposed unfair treatment of the U.S. They’re about forcing Canada, with no justification whatsoever, to submit to his will.
https://bsky.app/profile/atrupar.com/post/3ljnnnf5hvh23
Further, since individual contributions aren't mandatory, that money is freed up for zero-sum competition over things like good schools for your kids (that is, housing in good districts) so if you don't choose "defect" and spend the money instead of saving it, your family's overall worse off than it would be if everyone had to contribute.
Also, a tax-advantaged savings/investment account isn't the same thing as a pension.
The money can be invested, and then at some age (55.5 i believe?) you can access the money without being taxed. There is a maximum you can contribute per year etc etc.
I am not old enough to ever have had a pension option in my entire life, but I believe 401Ks are overall worse, because pensions come w/ some amount of guaranteed payout + someone managing the fund to ensure that happens. a 401K can go to zero, and you can forget to contribute (and most of the money is your own money anyways)
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The general population is not smart enough to understand a 401k and raids it as soon as they can.
The Obama administration was big on the “gentle nudge” policies - so that for example they would enroll you in retirement, but you could opt out, but I don’t think that’s strong enough.
Firstly you'd rightfully realize that whatever I said they weren't your savings, rather it was my money that I was agreeing to let you have at some future date. Secondly I would come to the same realization.
I think social security is a far better setup than forced savings account. The fact that it's much harder to raid, that it's not really 'your money' locked up somewhere is a big reason why it has lasted as long as it has.
Unless you're the government and can 'borrow' the money, from yourself, as part of some creative accounting scheme. Thanks Reagan.
https://www.fedsmith.com/2013/10/11/ronald-reagan-and-the-gr...
A public pension is a "forced savings account" that pools a whole bunch of risks together across the entire population. It's forced savings plus an insurance policy.
Now someone will probably say that everyone should be forced to save with a private account and also forced to carry "old age insurance" or something, but hopefully people can see that's just a public pension but worse, because you're at the mercy of middle men and grifters.
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