A recent Politico-George Washington poll conducted in “battleground” states asked respondents how they would reduce the federal budget deficit.
A significant majority of voters indicated strong support for two proposals: raising taxes on households earning more than $250,000 (60% favor), raising taxes on corporations (64% favor).
Voters also opposed raising the retirement age for Social Security benefits, with 64% against the idea. Interestingly, strong opposition came from young people age 18-29, 66% of whom opposed raising the retirement age. Opposition was strongest among Gen Xers (30-44) and those nearing retirement (45-59), at 69%.
Such strong opposition to raising the retirement age may be read as self-interest, but I think there’s something else going on here, especially among younger generations. Young people want their parents to have economic security in retirement, and Social Security is the foundation of that security. Many Americans nearing retirement had their savings decimated by the recession, fewer have access to pensions, and home values – which represent much of the wealth of middle class families – may not return to pre-recession levels anytime soon.
This leaves Social Security as the only guarantee in retirement, and Americans of all ages are willing to stand up and defend one of the best systems in America. That and they don’t want their parents moving in with them.
As a Certified Credit Counselor who does retirement planning for client’s raising the retirement age is INSANE and unnecessary. There were a range of option from Left – Right organizations to “reform” SS that were evaluated on recommendation from the Trustees who sent them to CBO for evaluation. Google “Social Security Policy Options August 2010″ and you will see several options which some actually will work. The one I personally like is Option # 2 which would raise the SS FICA Payroll tax by 1/2 of 1/10th of 1% each year for the next 30 years which in terms someone can understand would mean someone making $40K per year would pay 40 Cents more in payroll taxes each week and that much increase each year. However, if wages rise by the historical average of 1.2% (actually it is 1.8% but CBO uses the lower figure to be more Conservative in forward looking projections) a workers wages should go up about $8 per week and SS FICA taxes by 40 Cents. Another option is do nothing until about 2025 and then raise the SS FICA Payroll tax by 2% all of once and adjust in the 2030′s as needed. Either of these combined with adjusting the SS wage CAP to capture 90% of wage earners income and then adjust for inflation which would raise the CAP from around $110K to around $160K would also prevent any need for raising the retirement age to 70 and allow for an increase in the minimum monthly payout to $1,200 per month RIGHT NOW. I aks why we can’[t have an honest debate on these choices instead of being fed from the Right SS is bankrupt and from the Left the nothing needs doing????
Garry,
Thanks for your comment. I would suggest scrapping the cap altogether. Everyone pays the same rate for the same guarantee, and that’s that. Of course, you would have to add another bend point at the top for high earners. If this simple fix were done 5 years ago, there would be no talk about raising the age – and benefits could have been expanded!
- Alex