Since we’re talking about Social Security

August 26, 2010 at 9:26 AM (Uncategorized) (, , , , , )

I got this stuff from http://www.actuary.org  (link is to PDF)  …which also has what proponents and opponents say about each idea. as well as the percentage of the ‘solvency’ gap that each piece would ostensibly fix. (It comes out to over 100%, so each piece could also cut  a bit less and still (at least on paper) have the program clear.

This is something that I’ll get flamed for because it will please no one in the so-polarized-we-are-about-to-spontaneously combust environment.

I’m listing the stuff below, but with a caveat:

In my world *all* pieces would have to be a part of the puzzle, or none would be enacted.

And a lot of the things I like end up hurting beneficiaries who are older women, so it feels pretty bizzare….

But, my group of fixes avoids taxing benefits,  avoids ‘means testing’, (something I have no problem with but I know would never, never, never pass) avoids private pension cuts for those who have them, and avoids ‘gambling with the money of the marginalized,’ aka dumping benefits into the Wall Street arena, aka privatization.

1. Increasing the retirement age to 67 and indexing it thereafter  ostensibly corrects 26% of the funding imbalance.( If it’s so much per year how about a 13% correction of the funding imbalance by only increasing the age to 66? I’d prefer that.)

2. Reduce the COLA adjustment by 1 percent… which may fix up to 37% of the funding imbalance.

(I believe everyone had to do without a cola adjustment entirely in 2010, )

3. Raising payroll tax on employers and employees by gradually phasing in a 1 percent increase (from 12.4 to 13.4 percent ) could correct as much as 53 percent of the funding imbalance.

Who sacrifices:

Employers
Working people
And beneficiaries

(but, if the increase in the retirement age is left out of the equation only 76 % of the imbalance gets addressed.)

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