Good morning! About to rain yet again, here in the Catskills. March was mild here, as if it were April, and April has been March, with freezing nights and days in the forties.
In the news this week was that the Social Security fund has been dropping quicker than expected, and is expected to run out by 2033, rather than last year's 2036 estimate and much sooner than the 2050-ish extimate that was around for years. A Los Angeles Times editorial this morning, "Fix Social Security, Now" (good luck!), mentions the possibilities of raising Social Security taxes 20% or cutting benefits 16%.
The jobs crisis has, of course, put pressure on Social Security cash flow. Many people who never expected to retire anywhere near this early have seen no alternative to diving on their benefits at the earliest age they can take them, 62. The ranks of these involuntarily retired will only increase, and by the time the baby boom generation, with its inflated population, gets completely past that age, it will be 2026. So where do we go?
In my first book, dissertation Prospects for Increased Post-65 Career Employment for the Baby Boom Generation (2007), I named the possible solutions to Social Security funding as follows:
- Increased taxes
- Reduced benefits
- Increased immigration
- Needs-based reimbursement
- Subdivision into personal or private accounts
- Raising retirement ages.
I advocated the last solution, and still do. One plan that would maintain the same share of population that was over 65 between 1980 and 2000, which was 13%, would increase standard retirement ages to 67 in 2015, 68.5 in 2020, 70.5 in 2025, 72 in 2030, and 72.5 from 2035 to 2050.
Considering that one study of life expectancy and aging characteristics, back in 1988, said we could have a straight increase to 75, the plan above does not seem too extreme. After all, American longevity at age 65 has increased from 11.7 years in 1900 to 17.6 in 2000, and is going higher, with overall health improving at least proportionally. And since adoption of retirement at age 65 in the 1880s, U.S. life expectancy has increased so much that if indexed in the same way now, retirement would be at age 98.
Of course, Social Security has long been regarded as the "third rail" of politics - touch it, and you die. But we're coming up on the time when we will have no choice. Can we get it together to maintain the social security system, which is more valuable than ever with the lack of jobs? You tell me.