You know – that big pile of IOUs sitting in Al Gore’s Social Security “Lock Box” down in Tim Geithner’s basement.
Between people retiring earlier and dropping social security taxes, the “We’re out of money” date has moved forward five years to 2024. We’re already where the “Trust Fund” will be redeeming its “Special issue” Treasury Bonds, which means Congress can no longer offset money going into the trust fund to mask a spending deficit – in fact, this will create a need for the U.S. Treasury to replace those bonds with real bonds just to keep the US Debt at its current level.
Shazaam…. Surprise, Surprise, Surprise…. who could have seen that coming?
Quick, tax the rich and the oil companies!
Seems to me the easiest way to fix this is to raise the benefits age (I hate to call it the “retirement age” as one who properly prepares may retire at a time of their choosing). An American male born in 1930 had a 61.7 year life expectancy. American Male born in 1949 was the first to have more than a 65 year expectancy. Current numbers for males are over 74 years for life expectancy.
Raise the benefits age to match the life expectancy for the year of birth and don’t allow early claims. Late claims with higher payouts should be fine. Stop paying the earned income tax credit as a pre-benefit and keep the money in the Social Security system to be claimed (or not if the payer dies) when it’s supposed to be.
This, combined with a deterioration in our health care system under single payer and increasing obesity rates, will allow enough people to die to keep the system solvent. Sounds a little cold, but that’s how it plays out. Not enough workers paying in to support all the freeloader retirees who started collecting at 63 and are currently 84.
There are only two ways I can think of to fix it: increase the amount of money coming into the system by raising taxes or reduce the amount of money being paid out.
I am 100% in favor of paying less money for a shorter duration of time. Should go a long way toward fixing things.