Assessing the “Inevitability” of Social Security’s Insolvency - Morningstar.com
So much of today’s economic and political rhetoric, as well as many studies of Social Security’s steady financial decline, focuses on the predictable consequences of the program’s deficit situation. Many solutions are on the table, and someday they will get the attention of lawmakers responsible for preserving what has grown to be arguably the most successful social program in U.S. history. The real question is what will be done to avoid the draconian outcomes that would accompany the absence of corrective action.
In the meantime, Americans are left to worry about Social Security’s future and the impact that legislative changes could have on their retirement. Financial writer Brent Arends, in a post on morningstar.com, summarizes the results of a recent Transamerica Center for Retirement Studies survey that measured attitudes of 10,000 citizens on these very issues, concluding that 71% have been persuaded that cuts to Social Security – potentially deep cuts – are either likely or inevitable. The study also noted that 35%, of the survey participants said that “cuts to Social Security are their single greatest retirement fear – far more than, say, fear of isolation or getting dementia.”
Arends challenges the inevitability of the most frequently advanced legislative changes, e.g., tax increases and benefit cuts, and suggests that there are other, ways to address the problem. Arends goes on in his post to outline several areas of focus that should be considered to right the ship, including addressing the euphemistic “tax gap” and reducing wage inequality, and comes around to the obvious conclusion that taking no action would be politically, socially, and economically worse than any of the legislative remedies available.
This is an interesting perspective on Social Security’s problem, and poses some thought-provoking ideas. Read the full post here.