Rasing the Social Security age

In a clear example of how dysfunctional our current Federal government can be, changes to Social Security are on the table when considering if we should default on our national debt.

So far I have heard of three different items being in play with regards to changes to SS. The first is raising the retirement age, the second is changing the cost of living adjustment, and the third is means testing.

As a Democrat I would be fine with means testing. My personal preference would be removing the Social Security Wage Base. This would help the solvency of SS while requiring much fewer regulations to maintain and essentially have the same result as means testing for budget purposes. Unfortunately this is the least likely of these three items to happen.

Changing the cost of living adjustment would help to make SS more solvent however it would do it at the expense of lowering the benefits to retirees. Ironically Republicans want to cut taxes to get money back in people's pockets yet this proposal is essentially a tax increase since it is lowering the amount of money citizens would have to spend and keep more money in the hands of big government.

The item that I actually have the biggest issue with is raising the age for SS benefits. When John Boenher talked about this idea last year he said "We're all living a lot longer than anyone ever expected," . This seems to be the strongest argument for raising the retirement age. Unfortunately this statement is only partially true.

Boenher is looking for an increase of 5 years over the current retirement age. The belief that we are living longer is based on the data showing that around the time of implementation of SS, life expectancy was around 62 years while we are closer to 77 years today.

To some extent this statistic is a misnomer since one of the biggest reasons for the increase in life expectancy is a drop in infant mortality. If you look at the change in life expectancy starting at age 65 we have only realized an increase in 4.5 years since 1950.

To make matters worse the increase in life expectancy of the those in the top half of the earnings distribution is increasing faster than those at the bottom. The top half have seen an increase in life expectancy of 6.5 years since 1972 while the bottom half can expect to live a shade under 2 years longer.

So a system that was set up as a social safety net will be modified by Republicans in a way that will mainly benefit those who need it least. In essence we will "fix" SS on the backs of the poor and protect it for the well off since they will have a greater chance of being alive to utilize the system.

From tax cuts to health care to union busting, Republican legislators have shown that they will fight tooth and nail to keep money in the pockets of the rich at the detriment of the poor. And they do all this to support their version of Reaganomics which is vast departure of the actual supply side economics Saint Ronnie supported.

The good news is that Washington is in no mood to deal so changes to SS probably won't happen. The bad news is that the president shows no willingness to say no to the Republican agenda that kills jobs and stagnates the economy. Americans may be suffering but at least both sides think they are winning the political posturing battle.