At 77, Social Security confronts its own mortality
We have technologies to help us celebrate the program, but we still have to reinvent the way we think about aging.
How odd it is that we have technologies in this current century to help us celebrate the policies of Social Security (which turns 77 next week) and Medicare (which just turned 47), both formed in an earlier century. We have birthday cakes on Facebook pages and tweets from all quarters about both of these entitlement institutions.
And how interesting it is, too, that topics normally left to policy wonks inside the Beltway or among academics from Cambridge to Palo Alto have made their way into social media. Or that we are now being invited to take to the streets by the Alliance for Retired Americans in their summer campaign with the slogan, "Let’s Not Be the Last Generation to Retire." The group's goal seems to be to amass signatures on a petition calling for America to keep Social Security and Medicare far into the future. Not exactly the inspiration of the good old American work ethic and our understanding of virtue. And not anywhere in the vicinity of our current demographic realities which, as we live well into our 80s, hardly square with outdated ideas of retirement.
Yet the same crowd that so easily adopts this century’s newest communications technology is hopelessly stuck on ideas and institutions that were invented in – and for – an earlier time. And they are not alone, as was so clearly revealed in the groundbreaking AEGON Retirement Readiness Survey, which questioned 9,000 people across eight European countries and the U.S. who believe they’re worse off today and fear they will not be able to retire in 20th century style.
As we dramatically reduce birthrates across the globe, where there will soon be more of us over age 60 than under 14, it is the reverse that must begin to animate our thinking: What does a working life look like in the 21st century when there are two decades beyond 20th century traditional retirement age?
The campaign for retirement is not only peculiar in light of our longevity – how many people really want to play golf or garden for twenty years or more? Living for decades without an active income is also fiscally unsustainable in light of the dramatic demographic shift of what would be "working to retirement."
Sure, the Social Security and Medicare programs worked when they were invented. But even the vaunted UK National Health Scheme on which U.S. Medicare was modeled is unable to meet the demands of an aging population. And that’s against basic reforms year after year, including a change to the once-uncontested principle that you were either "in" or "out." Today, if you don’t like the health care you’re getting and can afford something on the outside, it’s OK.
In the hotly contested presidential campaign, there’s been barely a word from either of the candidates about these entitlement celebrations. Only in newly minted socialist France does there seem to be any public display of keeping 20th century retirement, but the confiscatory taxes that follow underscore the disconnect. Surely the demographic realities of our 21st century demand something more than retread 20th century policies.
Some may not want us to be the "last generation to retire," but the generations of the 21st century know they must reimagine and reinvent how they will live in their century.
Michael Hodin is a contributor at The Fiscal Times. Subscribe to The Fiscal Times' free newsletter.
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Remember that social security is an addition to some other income that you created during those active years of your life. During those years we paid a social security tax as did our employers on our behalf, and at age of 62 we all should be able to collect some reduced benefit which supplements any other income, and which we count on to make our golden years better.
You know, many paid into it for four or five decades, they actually have a fortune being taken care of by the USA government. If the president, senators, and representatives have believed that the SS fund is there to be raided every four years, that is their problem. It is time for them to pawn their property, to forgo their salaries, and to sell their fat behind because the SS fund IS NOT AN ENTITLEMENT, it is our money and we want it back!!!
When I started working in the 50's nothing but SS was offered and I paid into it all of my working life. Did not get into a company pension till in the 70's and that did not even match what I paid in UNION DUES to work for that company.
Did not get into a good retirement plan with a 401K till I moved to NC and got employed in 1993 with a GREAT COMPANY, everything was going fine and really built up a retirement chest, than came 9/11 and lost part of my 401K, than the GOV. signed the free trade acts and my JOB WENT TO CHINA, there went my chances of a good retirement.
Luckily my company pension was protected and has been a great help in my retirement.
I believe the GOVERNMENT does not want the BLUE COLLAR or MIDDLE CLASS WORKERS to be financially stable in retirement, I believe they want us to keep working till we DIE to support there life lifestyle's and provide for the ones that don't want to work and contribute to society.
What is happening with our new American Citizens who has never worked but when they get 65 years old they start receiving benefits?
As Johhny2001 stated "PLEASE, PLEASE STOP CALLING SOCIAL SECURITY AN ENTITLEMENT. IT IS NOT. WE PAID IN ALL OUR LIVES FOR IT." Personally I have paid in $134,283.61 to S.S. and also $28,299 to Medicare since they itemized it on my pay stub in 1991. I have paid less into my 401K and it's worth almost triple my contribution, if the Government would quit dipping into it it would easily be fully funded with wise investing of the monies paid in by those of us contributing.
Were we just giving the government our money then, in addition to the taxes we are required to pay. I personally have contributed to SS for 22 years. If the government can't sustain SS then will we have all of our money returned? I would say not. Our government needs a complete overhaul. Kick all of the politians out of Washington and start over with limited terms for Congressman. And no pension plan! I bet they will still receive their pensions when we are being screwed out of SS.
First, social security is designed to be a supplement to a defined benefit plan (think pension, an endangered species) or a defined contribution plan (think 401(k) - the key word being contribution - your contribution). Social security is not meant to fund retirement in its entirety. If you are thinking on relying on social security for the bulk of your retirement you are in for a rude awakening. If you have time to change course, do so and do so now. And for goodness sakes, don't bank on being able to work into your seventies as a 'retirement plan'. If you think working now is difficult, imagine doing the same in your 60s and 70s - not a pretty picture, is it? Take some measure of control - don't risk your entire future on the decisions of filthy politicians - you and you alone have your best interests at heart. You will thank yourself later....
Now, for the system....
Let the threshold be raised a touch to help shore up the SS fund in the short term. For the long term, however, we are expected to be able to handle our individual financials in a realistic manner - we should expect, rather, DEMAND, our sloth-like behemoth of a government do the same. Really???? Yes, really.
Government should be downsized - government should govern - a democracy is not designed to grow to such a size that it becomes able to care and provide for all. The more it provides the more it takes - moving evermore away from the definition and purpose of a democracy.
Foreign aid should be downsized - where in society do you see an individual borrow funds to be able to give to charitable organizations?
Someone has got to look into the health plans enjoyed by our elected - the elected ought to be subjected to the insane system the private sector is subjected to. Really - who can argue with that?
We need to stop functioning as the world's police department. Help, sure, shoulder the majority, no.
...and on and on
Looking at a few of these expenses and lowering them (similar to an individual reviewing their budget but on a much larger scale) might serve to protect our seniors from being raped and our youth from being robbed blind.
Lastly - vote. Vote enough reasonable and practical individuals in (party aside) good change can happen. Chip away, little by little.
Happy birthday, social security - here's to many many more healthy years.
Social security is not an entitlement, it is full funded and the system has worked better than any (overcharging for management fees) private ran insurance- partial retirement account. If Americans would just grow some balls and put a stop to the overpaying of our below average CEOs and a health care system that is much more concerned with huge profits than patient care we wouldnt be reading this article about the mortality of social security.The Author of this article above, should cantact his old college Alma Mater and ask for his money back as he obviously has learned nothing about journalism. He is just spewing garbage thought up in some corporate funded think tank.
The government is now referring to our Social Security checks as a “Federal Benefit Payment.” This isn’t a benefit – its earned income!
Not only did we all contribute to Social Security but our employers did too! It totaled 15% of our income before taxes. If you averaged $30K per year over your working life, that's close to $180,000 invested in Social Security.
If you calculate the future value of your monthly investment in social security ($375/month, including both your and your employer’s contributions) at a meager 1% interest rate compounded monthly, after 40 years of working you'd have more than $1.3+ million dollars saved! This is your personal investment.
Upon retirement, if you took out only 3% per year, you'd receive $39,318 per year, or $3,277 per month.
That’s almost three times more than today’s average Social Security benefit of $1,230 per month, according to the Social Security Administration (Google it - it’s a fact). And your retirement fund would last more than 33 years (until you're 98 if you retire at age 65)!
I can only imagine how much better most average-income people could live in retirement if our government had just invested our money in low-risk interest-earning accounts.
Instead, the folks in Washington pulled off a bigger Ponzi scheme than Bernie Madoff ever did. They took our money and used it elsewhere. They “forgot” that it was OUR money they were taking. They didn’t have a referendum to ask us if we wanted to lend the money to them. And they didn’t pay interest on the debt they assumed. And recently, they’ve told us
that the money won’t support us for very much longer. But is it our fault they misused our investments?
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