Will Social Security Last for Gens
X, Y, Z?
Some say no; Some say fixes are minor
Posted May 07, 2012 07:40 am
By Stephanie Carroll Carson
WASHINGTON, D.C. - Social Security is going broke three years earlier than last year's projection, according to the annual report by the Social Security Board of Trustees. Some are sounding the alarm bell for major changes, while others say needed fixes are minor.
Links of interest:
•
Social Security Works
•
Daniel Patrick
Moynihan "The Fox Is Back In The Chicken Coop"
The report released last week predicts that trust
fund will be exhausted by 2033, compared with 2036 in
the 2011 projection.
However, Social Security Works co-director Nancy Altman
says the program's foundation is strong, and can be made
solvent with some modest changes.
"There are many, many ways to bring that additional
revenue in. It is a program that works and we should be
strengthening it and building it, rather than
dismantling it."
One suggestion by some policymakers is to increase the
tax cap, which now stands at $110,000 per year; no
contributions go into Social Security for annual income
above that amount.
According to the National Academy of Social Insurance,
three in four Americans - across age groups and party
lines - say it is critical to preserve Social Security
even if it means asking working Americans to pay higher
taxes to do so.
Some economists and policymakers suggest keeping the
current program for those 55 and older, while offering
younger workers the chance to invest over one-third of
their Social Security taxes into private retirement
plans. Altman sees this as the wrong approach, adding
that the program is efficient the way it is.
"It covers everyone on a mandatory basis. So, if you
start allowing people to opt out, it sounds good, but it
would ultimately cause the whole system to unravel."
Altman believes the program is strong, and provides
guaranteed benefits - unlike people's 401(K)s and home
equity.
Links of interest are added by the Observer