There was a U.S. Supreme Court case from the early 1960’s – Flemming V. Nestor – which heldt hat Social Security contributions are in fact just another tax, and that US citizens have NO property right to Social Security benefits.
The case held Congress had the inherent power to reduce (or eliminate?) Social Security benefits at any time, notwithstanding the fact that individuals may have paid FICA taxes for a lifetime.
This is still the law of the land, which raises some interesting questions for Democrats who claim to want to protect the Social Security benefits of seniors: why haven’t they done anything to protect benefits by giving us a property right to them, e.g., their vehement opposition to so-called “private accounts”?
This also raises some interesting questions when one considers that the RI General Assembly appears to adopt the public sector unions’ refrain that pension benefits can only be cut for new hires, that once one is employed as a teacher or state employee the benefits in effect on that first day can only be raised, but never lowered.
In other words, this is another example of the gross disparity between benefits of private-sector workers and those employed in the private sector financed public sector.
If you had the political will, the General Assembly could freeze the state pension benefits today – no one would be deprived of benefits to which they were already vested, but henceforth teachers and state employees could join the real world (like the rest of us) and participate in a 401(k)-type plan.
In turn, this would greatly alleviate (if not eliminate) Rhode Island’s $4-5 BILLION unfunded pension liability, though worst per capita in the entire country!