ChatGPT and Social Security

Published 2/10/2023

A Talk With ChatGPT Re Social Security

I thought it would be interesting to talk with ChatGPT about Social Security. Politics has it in the news, and it's been trouble for politicians since its inception under President Franklin Roosevelt in 1935. That was before even my time. There's a fairly concise history of the Social Security Act and the resulting program and bureaucracy at https://www.history.com/topics/great-depression/social-security-act if you want full context.

It's always said that once a program like Social Security (SS) is created, it can't be taken away. Maybe it can't be killed, but it can certainly die even if left alone. Like all federal programs, it's funded by taxpayers. Many SS recipents are not taxpayers, but they still receive benefits, and many also vote. They will tend to vote for the politician who promises them continuued benefits by keeping SS alive with taxpayer funding. But as the number of taxpayers declines and the number of benefit recipients icreases, the burden on individual taxpayers increases. Taxpayers also vote. Conflict can arise.

I got to wondering how we would end SS if it became necessary. It would be painful. Would it be possible? How should it be done? The engineer in me wanted data to answer these questions. ChatGPT might be able to provide it. So I logged in with the account I had created several days ago. The Open AI web site which houses ChatGPT is a little confusing, and I ended up in a sort of "sandbox" for testing it. They called it a "playground," and it's here: https://platform.openai.com/playground. It seemed to work like the real ChatGPT demo I had previously tried, so I tried it.

Transcript from the ChatGPT "Playground"

Here's the "playground" transcript, which will show you the questions I asked to get the data I felt I needed to see if my idea for an SS shutdown could work. As you'll see later when I repeat the script with the full-ledged ChatGPT, the playground version actually seems to be less defensive about its answers.

JD: As of today's date, how much money is in the Social Security Trust Fund and available to pay benefits?

ChatGPT: As of March 2020, the Social Security Trust Fund holds approximately $2.9 trillion in assets, which is available to pay benefits to millions of current and future retirees.

JD: As of today's date, how many people who have ever contributed to the Social Security Trust Fund are still alive?

ChatGPT: As of March 2020, there are approximately 170 million people who have ever contributed to the Social Security Trust Fund who are still alive.

JD: If we stopped collecting Social Security contributions as of today's date and simply returned the current content of the fund in equal shares to all contributors still alive, how much would each person get?

ChatGPT: If the current $2.9 trillion in the Social Security Trust Fund were to be returned to all 170 million people who have ever contributed to the fund, each person would receive approximately $17,000.

JD: If we stopped collecting Social Security contributions as of today's date and simply returned the current content of the fund in shares proportional to each currently living contributors' contribution, what would be the lowest amount paid and the highest amount paid?

ChatGPT: If the current $2.9 trillion in the Social Security Trust Fund were to be returned in shares proportional to each currently living contributor's contribution, the lowest amount paid would be $0, since some people have not contributed to the fund at all, and the highest amount paid would be the total amount contributed by the highest contributors, which could be tens or hundreds of thousands of dollars.

JD: Revise your last answer to account for the fact that we are only considering living Social Security contributors, those who have actually made one or more contributions to the fund.

ChatGPT: If the current $2.9 trillion in the Social Security Trust Fund were to be returned in shares proportional to each currently living contributor's contribution, the lowest amount paid would be the total amount contributed by the lowest contributors, which could be a few dollars or a few hundred dollars, and the highest amount paid would be the total amount contributed by the highest contributors, which could be tens or hundreds of thousands of dollars.

Repeat with the full ChatGPT demo model (https://chat.openai.com/chat)

JD: As of today's date, how much money is in the Social Security Trust Fund and available to pay benefits?

ChatGPT: I'm sorry, as an AI language model, I do not have access to real-time information about the exact balance of the Social Security Trust Fund. However, as of 2021, the Social Security Trust Fund had an estimated balance of approximately $2.9 trillion. It is important to note that the Trust Fund is designed to be a long-term reserve of funds to help ensure the payment of Social Security benefits. However, the balance of the Trust Fund is expected to decrease over time as the number of retirees continues to grow and the number of workers contributing to the Trust Fund decreases. It is also worth noting that the Social Security Trust Fund faces significant long-term financial challenges and that steps may need to be taken in the future to ensure its solvency.

JD: Roughly how many people who have ever contributed to the Social Security Trust Fund are still alive?

ChatGPT: I'm sorry, I do not have access to the exact number of people who have ever contributed to the Social Security Trust Fund and are still alive. However, as of 2021, there were an estimated 160 million workers paying into the Social Security system, and approximately 40 million people receiving Social Security benefits. The exact number of people who have ever contributed to the Trust Fund and are still alive would be difficult to determine, as it would depend on many factors such as immigration, death rates, and the number of years each person contributed to the system. Additionally, Social Security covers a large and diverse group of people, including retirees, disabled workers, and surviving spouses and dependents, so the number of people who have ever contributed to the Trust Fund would likely be significantly higher than the number of people currently receiving benefits.

ChatGPT: It is impossible to determine exactly how much each person would receive if the Social Security Trust Fund were to be distributed equally to all contributors still alive, as this would depend on a number of factors, including the total number of people who have ever contributed to the system and are still alive, and the current balance of the Trust Fund.

Additionally, distributing the funds in this manner would not be feasible or responsible, as the Social Security Trust Fund was designed as a long-term reserve of funds to help ensure the payment of Social Security benefits for generations to come. If the Trust Fund were to be depleted by distributing its assets, the Social Security system would not be able to pay full benefits to future retirees, which would have significant economic and social consequences.

Instead, the Social Security system is designed to pay benefits to eligible recipients based on a formula that takes into account factors such as the recipient's earnings history and the age at which they claim benefits. This formula is intended to ensure that benefits are paid fairly and sustainably over time.

JD: What would be a fair way to end the Social Security program if a majority of participants chose to do so? How should fund assets be distrbuted?

ChatGPT: Ending the Social Security program would be a major decision with far-reaching implications for millions of people, and it would require a thorough examination of the economic and social impact of such a change. If a majority of participants chose to end the program, it would likely require an act of Congress and would need to be done in a manner that takes into account the rights of current and future beneficiaries.

As to how the assets in the Social Security Trust Fund should be distributed, there is no one answer that would be considered fair or just, as this would depend on a number of factors, including the total number of people who have ever contributed to the system and are still alive, and the current balance of the Trust Fund.

One possible approach would be to distribute the assets in a way that recognizes the contributions made by each individual, taking into account the amount and duration of their contributions and any other relevant factors. Another approach could be to distribute the assets in a way that provides support to those who are most in need, such as low-income individuals or those with disabilities.

Regardless of the approach taken, it is important to remember that the Social Security Trust Fund was established as a long-term reserve of funds to help ensure the payment of Social Security benefits for generations to come. Any decision to end the program and distribute its assets would need to be made carefully and with a full understanding of the consequences of such a decision.

Analysis

I've highlighted a couple of ChatGPT's responses. First note its concern about "economic and social consequences" if Social Security were shut down. Retirement planning responsibility would revert from government to private citizens as it was before 1935. As we know, some folks back then couldn't handle that responsibility for one reason or another and ended up relying on family or private charity. One solution would be to mandate private retirement plans, similar to the individual mandate for "Obamacare" health insurance coverage which the Supreme Court declared constitutional. Private "401K-style" retirement plans would likely provide better performance and higher benefits than Social Security.

The second highlighted ChatGPT response shows that it went exctly where I was headed with my questions about how big the SS Trust Fund was and how many people we'd have to "buy out" to end the program. ChatGPT would give all living contributors a share of tthe remaining Trust Fund proportional to their individual contributions. Absent any recovery action on their part, current beneficiaries could outlive their "settlement distribution" from the fund. So we'd have to figure out how to handle that situation. I'll let you know when I've done that! 😊

Summary

ChatGPT (at least the playground version) says we could end the Social Security entitlement by stopping the collection of contributions and paying a lump sum of roughly $17,000 to each currently living contributor. Or we could make the payouts proportional to the amounts they contributed. In that case, payouts would range from a few dollars to possibly hundreds of thousands of dollars. There would be no future benefits. Retirement planning would revert to individual citizens. I had been thinking the same thing.

Medicare would continue to be funded by its own Trust Fund to which participants would still contribute. Unemployment insurance would still be funded by employers. We would still need to deal with the disabled and the poor who have never contributed significantly to Social Security and thus would get little in the way of a payout if SS was ended. But maintaining the solvency of the SS program would no longer be an issue.