Social Security is a very “hot-button issue” this year because many economists believe it could really help stabilize the U.S. economy. In terms of international standing, many argue that fixing social security could build confidence among the international community and especially with foreign lenders. The whole point here is to assure that interest rates do not go up too high so the U.S. has more time to deal with other economic issues like tax, healthcare and budget reform.
The issue is that this year, social security is believed to be taking in less revenue than it is paying out in benefits, a first for the nation – and it does not look any better in the future. CNN highlights that within the next few years social security is going to permanently go into “the red”. Though many government and economic officials have argued that this is a problem that can be dealt with later, it seems that it is essential to start implementing policies to save the social security system NOW. The article gives a variety of options to make sure that social security does not run out: increasing the retirement age, reducing growth in benefit levels and raising the payroll tax.
2 comments:
I think increasing the retirement age is the first option we should consider. Imagine if the average life expectancy ballooned to 200 years. Would the social security system be expected to support United States citizens past age 65 until they pass away? Certainly not. As the years that social security payments are withdrawn increases (with increasing life expectancy), the amount of money put into the system needs to be increased. Increase the retirement age required to reap benefits and the system will be closer to effectiveness.
The problem with social security should be dealt with immediately. This is because all of the people in there 20's and 30's have invested a lot of money into this account. It would not be fair to just take care of the problem later. This means that the working people now will never reap the benefits of social security. This is what most people in the U.S. live off of when they retire. How will we be able to support each other when we retire? The government should raise payroll taxes and should reduce the amount that the retired are currently receive. It is only fair considering that most of the baby boomers are retiring around this time too.
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