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Why Is Social Security Regressive?

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Why Is Social Security Regressive?

National Affairs January 3, 2022
EconomicsOther

In 1971, two short, balding, middle-aged Americans (one the son of a dry-goods merchant, the other a son of a grocer) met in a hotel to discuss Social Security. But because this was Washington, D.C., and the two men were Milton Friedman and Wilbur Cohen, the ballroom was packed with men and women eager to hear them speak.

Friedman, who would receive the Nobel Prize a few years later, observed that "social security combines a highly regressive tax with largely indiscriminate benefits and, in overall effect, probably redistributes income from lower to higher income persons." "[A]s a way to distribute government assistance to the needy," he added, "the structure of benefits is not defensible and is not defended even by the proponents of social security."

Continue reading the entire piece here at National Affairs

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Chris Pope is a senior fellow at the Manhattan Institute. Follow him on Twitter here.

Photo by Kameleon007/iStock

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