Is Philanthropy Enough? A Case of the United States and the Future of Social Security

October 19, 2011

Political economy

The future of social security in the United States can best be described as uncertain. There is overwhelming evidence that the current system is no longer sustainable and that changes within the next few years are absolutely necessary. The program has been in place in the United States since 1935 and a track record of over 70 years of success is nothing to be ashamed of. Conditions have changed within the United States though and with these change in conditions comes a necessity to change the current social security system.

Many groups within the United States have their own ideas on exactly how we should restructure the social security program. Certain groups (many consider them radial and their ideas unrealistic) have proposed a restructuring that would utilize philanthropy as the main funding behind social security. Crazy idea, right? Who in their right mind would believe that the citizens of the United States would never be willing to donate that much money? Tocqueville may have a different idea.

In discussion section a couple weeks ago, my group was asked to analyze the following quote by Tocqueville:

“Although private interest directs the greater part of human actions in the United States as well as elsewhere, it does not regulate them all. I must say that I have often seen Americans make great and real sacrifices to the public welfare; and I have noticed a hundred instances in which they hardly ever failed to lend faithful support to one another”.

We were then asked if we believed the observations by Tocqueville were still applicable and observable in society today. Our group argued that Tocqueville would still make the same observations in today’s society because of the countless number of charity organizations within the United States and the amount of money Americans as whole donate on a yearly basis. We as a society are often willing to donate some of our wealth and sacrifice a small amount for the greater good of those less fortunate than us and for society as a whole.

If the members of my group and the members of our discussion section as a whole were able to agree that society is willing to donate money for the greater good, why is it so unreasonable to argue that philanthropy can be used as a main source of funding for social security? Obviously we would have to count on the generosity and willingness of our nation as a whole.

It is just an interesting observation that so many individuals seem to agree with Tocqueville and say that he would observe the same levels of philanthropy within the United States but find the idea of philanthropy funding social security such an unreasonable idea.

Why do you believe this paradox exists?


About TylerJHughes

Financial analyst at the University of Michigan's Medical School

View all posts by TylerJHughes


Subscribe to our RSS feed and social profiles to receive updates.

2 Comments on “Is Philanthropy Enough? A Case of the United States and the Future of Social Security”

  1. jonkeren Says:

    You are definitely on track when you say that the future of Social security is uncertain. The main reason why many people and myself believe that social security will not last much longer is because people are living much longer than they used too. When Social security was first created the US did not have the advanced medicines it has today. As a result of these advanced medicines, people are living longer lives. The way I see it, the best way to solve the problem with Social Security is to raise the age that people first start receiving it. Additionally, it makes sense to say that the Social Security problem could be resolved through philanthropic actions by wealthier Americans. Although this could solve the issue, the real question is would this ever happen. In my opinion this would never occur. The Majority of people would not be willing to donate money knowing that it is going to pay for someones retirement. In the current system the United States has, citizens who work are required to pay social security because it is taken straight out of their paychecks. Therefore American workers are essentially forced to pay for Social Security. If Social Security was solely left up to Americans Willingness to pay for it, there would be very little left of it in a matter of a few years. Overall the bottom line is that America cannot rely on the willingness and goodness of American citizens to pay for Social Security.

  2. dkap7 Says:

    Social Security has been under dispute for some time, and as a member of our Countries Youth I feel it is unfair that I will start to pay taxes that will benefit the elderly, but when I am older I will not be provided the same benefits because the social security program that is in place will not withstand the continual advancement in science and medicine that is allowing people to live longer and longer. Assuming that the average life expectancy in 1935, the year the social security bill was enacted, was in the high 50s and low 60s and today’s life expectancy nears 80 and will continue to increase as long as technology advances, it is safe to assume that the social security backing will begin running out of money to pass out. Therefore, the government needs to implant a new proposal for how social security works to ensure that younger generations like mine, are not stuck paying taxes that benefit the elderly, only to come to the point where social security no longer exists and we are gipped of any benefits.

    Having social security run through the philanthropy of the citizens could potentially work. About 2% of Americans that make up around 40% of America’s wealth. These two percent would have to donate a ton of money for this plan to work, making it extremely difficult to implement. This said, most philanthropy work would not be centered around social security, making it difficult to gather enough money to equally spread a beneficial amount of money to these elderly people in need. Social Security is important to our society. however, the plan that has been in place since 1935 is outdated and no longer relevant to modern day society. People are living longer and the population has increased in size. Therefore the government needs to take charge and bring about a more effective plan for social security. The idea and goal behind social security is extremely important, however the actual plan behind reaching this goal no longer can work in our country today.

%d bloggers like this: