Archive for Sunday, July 11, 2010

Lawmakers float idea of raising Social Security benefits age to 70

July 11, 2010

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— Young Americans might not get full Social Security retirement benefits until they reach age 70 if some trial balloons that prominent lawmakers of both parties are floating become law.

No one who’s slated to receive benefits in the next decade or two is likely to be affected, but there’s a gentle, growing and unusually bipartisan push to raise the retirement age for full Social Security benefits for people born in the 1960s and after.

The suggestions are being taken seriously after decades when they were politically impossible because officials — and, increasingly, their constituents — are confronting the inescapable challenge of the nation’s enormous debt.

Social Security was created in 1935 with a retirement age of 65, but since then life expectancy at that age has increased by about six years, according to the National Center for Health Statistics.

Today the full Social Security benefit retirement age is 66 for people born from 1943 to 1954. It then increases by two months for each birth year (66 years and two months for those born in 1955, 66 and four months for those born in 1956 and so forth), until those born in 1960 or later get full benefits at age 67.

Raising the age eventually to 70 could prove to be politically acceptable because it wouldn’t have an immediate social impact, but it would demonstrate that politicians are resolute enough to mend one of the government’s most popular social programs and to tackle the national debt.

If they did, they’d have substantial academic backing.

“For a while, there’s been a consensus among economists that raising the retirement age makes a lot of sense,” said Richard Johnson, a senior fellow and the director of the Retirement Policy Program at the Urban Institute, a Washington research group.

Still, there are potential downsides.

“There are some incredible ramifications to raising the age,” said Barbara Kennelly, the president of the National Committee to Preserve Social Security and Medicare. “Not everyone can work until they’re 70.”

Despite such concerns, the trial balloons are firmly anchored.

Last month, House Majority Leader Steny Hoyer, D-Md., launched his in a major address to a Washington budget conference.

“We’re lying to ourselves and our children if we say we can maintain our current levels of entitlement spending, defense spending and taxation without bankrupting our country,” he said.

“We could and should consider a higher retirement age or one pegged to life span, more progressive Social Security and Medicare benefits, and a stronger safety net for the Americans who need it most.”

Soon after, House of Representatives Republican leader John Boehner of Ohio told the Pittsburgh Tribune-Review that the age “eventually” could be raised to 70.

“Raising the retirement age — going out 20 years and not affecting anyone close to retirement, and eventually getting the retirement age to 70 — is a step that needs to be taken,” he said.

Comments

jmadison 5 years ago

Social Security is the biggest Ponzi scheme going. Congress would be in jail if they had to adhere to the generally accepted accounting rules regarding how to report retirement benefits. Expect more shenanigans once the government implements Obamacare.

Ron Holzwarth 5 years ago

But - is it really a Ponzi scheme when you can just print more money to pay off the early investors?

I think a Ponzi scheme assumes a finite supply of money. But when more can be printed at will, perhaps that definition no longer has merit.

Inflation? What's that? Haven't you read that the definition has been changed to "core inflation," which disregards energy and food prices?

independant1 5 years ago

SSA fund - IOU's in a lock box

Once a man wants to hold a Public Office, he is absolutely no good for honest work. (Will Rogers)

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