The Social Security Administration operates on less than one percent of its annual budget, maintains offices in every major city of the country, and has never failed to deliver payments to the retired and disabled precisely on time. Not once has there even been a delay.

The Social Security Administration is in the insurance business just like any private sector insurance company. The only difference is that this insurance company is under the umbrella of the federal government, a not-for-profit institution that is not supposed to engage in private enterprise.

The Social Security Administration also pays benefits out of the current receipts from new and not yet retired subscribers to the program just as any successful private sector insurance company. All private insurance companies must continually sell new policies and collect premiums from current subscribers. To be successful, these premium payments are sufficient to pay current benefits plus produce a profit which, in turn is invested in salaries, commissions, and property that the company hopes will not be used to cover benefits. The government, however, forces its insured to pay premiums, does not have to sell the program, produces profits and calls this a pay-as-you-go or "paygo" system, primarilly to make the public believe that it's a different form of insurance.

Thanks to the 1983 increase in payroll taxes that were far beyond what was required, and which the Social Security Administration had nothing to do with and did not recommend, this supplemental insurance program has been producing tremendous profits. Profits which the federal government pretends to borrow, but actually steals.

The Administration also handles all the actuarial research and data of any good insurance company figuring the odds on how long people will live and so forth. With more than 60 years of continuous service it has certainly lived down any connection to Ponzi schemes or pyramid scams that do not survive beyound the fifth tier because they fall in on their own bloated weight. If Social Security were a Ponzi scheme, all of the currently retired would be billionaires.

And yes, there are probably some actuarial differences that need to be addressed. Things like African Americans not living as long as their counterparts, widows being forced to choose between their husband's and their own benefits, the constant complaints of people "in the cusp" who feel cheated, and other points. But none of it adds up to throwing the baby out with the bath water, the silly notion that some hold about "privatizing" the entire system.

Social Security was never meant to be more than supplemental retirement. Born in the Great Depression when it was obvious too many had absolutely nothing set aside for a rainy day, the system was never meant to be anything more than assurance that no one who had worked in this country would be penniless in their golden years, would at least have walking money, and would not be forced into the very real "poor houses" of earlier times.

It was only the success of the Social Security system that allowed it to be expanded under the Eisenhower administration to include the disabled, those who because of injury could no longer work. And it was the same success that fostered the Medicare program during the Johnson administration. All additions to payroll taxes.

With all the scare stories bandied about by politicians and half-baked reformers, a review of the historical economics based on actuarial changes is in order:

The Beltway Bandits will often claim that the program is in trouble because of the dwindling number of premium contributors to retirees, and they will site cases where original benefactors had up to forty workers contributing to the benefits paid out, but they will never tell you that at the time these workers were only contributing one percent of their salaries or that the "self employed" didn't pay payroll taxes.

As a teenager during the Forties, working a paper route, setting pins in a bowling alley, or as a soda jerk making huge sundaes and thick milk shakes for my friends or anyone who treated me kindly, and for many years afterwards I was able to reach the maximum and stop paying premiums by mid-year or thereabouts. Few can do that today.