Social Security: A wildly successful antipoverty program. Can that continue?
By any calculation, Social Security’s role in greatly reducing poverty rates among America’s seniors cannot be disputed. David W. Rasmussen’s article notes that poverty rates among Americans aged 65+ were as high as 78% in 1939, down to 35% in 1959, and just 10% by 1995. The question is, can poverty rates continue to remain low among this demographic? They may not be. Rasmussen points to Social Security being one leg of Americans’ three-legged retirement stool, with the others being widely available defined benefit retirement plans (i.e. traditional pensions) and personal savings supported by strong economic growth. However, each year fewer Americans have traditional pensions, as businesses began moving toward 401k and defined contribution plans years ago. Further, most economists project lower growth rates than historical norms in the upcoming decades. All of this means the onus is on workers to save vastly more sums than is now happening. Add in Social Security’s looming insolvency in 2034 and there is great risk that poverty will once again come back to haunt America’s seniors. This article concludes with options for saving Social Security long term, such as taxing all wages rather than the current cap at $128,000 and higher taxes on the wealthy to use general revenues to continue funding Social Security, though that would smack of “welfare” to many. Read the full piece here.
The Association of Mature American Citizens (AMAC) has a different approach, making modest changes in cost of living adjustments and the retirement age, without the need for any tax increases on workers. AMAC advocates for a bipartisan compromise, “The Social Security Guarantee Act,” taking selected portions of bills introduced by Rep. Johnson (R-TX) and Rep. Larson (D-CT) and merging them with the Association’s own well researched ideas. AMAC is resolute in its mission that Social Security be preserved and modernized and has gotten the attention of lawmakers in DC, meeting with a great many congressional offices and their legislative staffs over the past several years. Read AMAC’s plan here.
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