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If you warn of disaster for long enough, people eventually stop listening to you - even if you were right the whole time just really, really foresighted. Easily predictable disasters can be bigger problems than surprising ones, because human nature being what it is, we can get so used to accustomed threats that we just learn to live with them and ignore them. It's like the giant cliff over town that everyone says will fall in and kill us all but never has - until one day, it does.
So it is with Social Security. The looming bankruptcy of Social Security has been a political issue since we were kids, and in all that time next to nothing has been accomplished to fix it. The Republicans look at the numbers and say "It's gotta be cut!" Then the Democrats roll campaign ads showing Republicans throwing Granny off a cliff, win the next election, and that's the end of that.
Old folks don't see why their promised benefits should be cut - didn't they pay for them in taxes for decades while they were working? And the Republican doomsayers must be wrong - after all, last month's check came OK, and the one before, and the one before that. Social Security checks have never been seriously late or ever bounced.
But Social Security is going bankrupt, and someday the checks will bounce. We've talked several times about the mathematical "why" - simply put, we have too many old people living and collecting for too long, and too few working younger people making too-small salaries to pay the bills.
What's more interesting is the sociological "why." Social Security was put into place in a very different time, based on a unique set of cultural and economic assumptions. Those assumptions were true then, but they hadn't been true until, say, a century before. And they aren't true anymore.
On the face of it, a plan for young people to pay the retirement bills for old people has some pretty serious problems. Everybody has two parents; it would be obviously unaffordable to expect one person to pay enough taxes to provide for two old people and have any left to take care of themselves and their own family.
This is actually the situation we see in China, which has enforced a "one-child" policy for half a century and now is facing a truly appalling demographic cliff. In China, it's not uncommon to find one individual in the prime of working life, who has two parents approaching retirement age, and four grandparents already retired, and eight great-grandparents (maybe a couple less) - and our one working man is the only descendant of that entire family tree! The economics are impossible, and the only way China's getting away with it is because they don't really have a public pension program or universal medical care. Outside of the wealthy major cities, old folks just die unless they can somehow persuade their descendants to personally and directly take care of them.
In America it's not so bad; even today most children aren't only children. Still, with most adults living past eighty and wanting to retire at sixty, we can easily foresee an America in which each working person must support one retired person. That's why the fights over lavish government-union pensions are so vicious; the amounts involved are too vast for the towns and states to ever pay, and too vast for the retirees to do without or make up some other way.
When Roosevelt created Social Security, the math worked quite differently. We're all aware of how much life expectancy has grown since 1930; at the beginning of Social Security, its official retirement age was older than the average life expectancy. America could afford Social Security back then because most Americans would croak before they ever collected it; now that most Americans do live long enough to collect, often for decades, we're in deep trouble.
But the bait-and-switch of life expectancy wasn't the only mathematic fact in Roosevelt's favor. Even in the teeth of the Depression, both Roosevelt and most Americans expected the future to be brighter; it always had been, and still was.
Consider the worst-case scenario, a young man born in 1915 who turned 18 and entered the workforce in 1933 at the Depression's lowest point. For several years, he no doubt had a terrible time making ends meet; but by 1939, with war factories firing up, good jobs could be found. There was a brief recession at the end of the 1940s, and then again at the end of the 1970s right when retirement beckoned for him, but our Depression worker can be expected to have had a generally successful working life overall.
How about his own father, born in 1890? Most of America worked on small farms in those days; the golden era of middle-class jobs in giant factories were decades in the future. At best, 19th-century Dad might have enjoyed a few well-paying years working in a war plant immediately before retirement, if his age and health were good enough after a lifetime of hard work on the farm.
To sum up: over his lifetime, our Depression worker earned a whole lot more money than his father did over his life - and would have expected to do so even in the midst of the Depression. The money required to keep Dad alive at retirement was a small fraction of what Son was earning. Multiply this wealth effect across all of American society, and FDR's Social Security starts to make sense.
It may be painful for conservatives to admit it, but FDR was right: America could, in fact, afford to provide a pension to its elderly. America has, in fact, managed to do so for eighty years, and only in the last handful of years has Social Security started to pay out more than it takes in. What other government program can say the same?
So let's glance at the generations. The American man born in the 1890s earned much more in his life than his father born in 1865, at the end of the Civil War, who earned a lot more than his father born in 1840 when industrialization was just beginning to stretch across America, who certainly earned a ton more than his father born in 1815 when the Industrial Revolution was only just getting started in England and had a long, long way to go before reaching down to a backwoods American. Over all that time, each succeeding generation of Americans was far richer, far more successful, far more comfortable, far better-provided-for in every material way than their parents were - so to provide for their parents in the much lesser style to which they were accustomed was no big drain on the economy.
This remained true through much of the 20th century. The example we started with, an American man born in 1915 who entered working life in the teeth of the Depression, still did far better than his father. His son, born in 1940 right before the war, would have done even better, riding up the slope of the Baby Boomers that followed right after the war. He would have entered working life in 1958, or maybe a little later if he went to college, reaping the boom of the 1960s and early 70s, probably being a bit too old for the Vietnam draft. By the time of the Carter recession, he would have been well-established in life, and then the 80s and 90s certainly made up for whatever was lost. Odds are he retired shortly before the crash of 2008.
But what about his son, born in 1965? He almost certainly went to college, graduating in the late 1980s just before the tech boom. A very auspicious start, for sure - but since then America's economy has stagnated, and that generation has certainly not done better overall than their parents. While the 1965 man may be able to afford to help out his parents, they're roughly equal economically and there's no obvious reason why he should have to - especially since the older generation has already spent their whole life earning money and the younger generation hasn't.
Then there's his son, born in 1990, who is just coming out of college now into a truly disastrous economic environment in which half of college grads can't find any work at all, and most of those that do are serving coffee or doing other work that doesn't even need a degree. Unlike previous generations, they're crushed under student-loan debt and also face the monumental national debt that will have to be repaid by them after their seniors pass on.
Could the situation improve for our modern-day college grad? Sure it could - life looked pretty grim for his great-grandfather starting out in the Depression but it worked out OK in the end. But we've now had two generations that haven't done markedly better than their parents, the last of which giving every indication of potentially doing considerably worse.
The bottom line: Expecting the working young to pay for the retired old works only if the young are making loads more money than their parents did, and most of their parents are dead already. Neither of these requirements are true today.
Throughout most of history, the young weren't expected to provide financially for the old. They were expected to provide physically, if need be - Granddad might move into a spare bedroom and eat from the family bean pot - but there'd be one oldster at most, the others being dead.
More commonly, the old would help out the young, since the old had more money - they'd had their entire lives to earn it! When we see unemployed college grads moving into Mom's basement and struggling families taking withdrawals from the Bank of Mom and Dad, it may seem un-American, but it's actually just a return to the way life worked throughout much of history in most places. Only in the most recent few centuries has technological progress and wealth growth been so strong as to allow for any other system.
In fact, early America was set up on the older assumption. Who has paid for public schools since they were first created in the 1600s? Property owners - virtually all of whom are too old to ever benefit from those schools themselves. The old are directly transferring financial benefits to the young, not the other way around.
If the technological and economic growth curves return to the tremendous uphill climb we saw throughout the 19th and 20th centuries, Social Security will be OK with a few tweaks to the retirement age. Our grandkids will be as unimaginably richer than us as the 1940 baby was over his 1890 granddad.
But if not - and, frankly, there don't seem to be signs of any growth these days much less fast growth - Social Security is done for no matter what our politicians do.