DAILY SUMMARY May 5

[National Dialogue Moderator <moderator>]

Title: Daily Summary May 5, 1999

Daily Summary May 5, 1999

 

Moderator's Question:

Wednesday, May 5: Bob Rosenblatt noted that the retirement age for full benefits will climb gradually from 65 to 67. His question is whether the age should be boosted to 69 or 70, effective in the years 2040 and beyond. He also asked whether the increase should be combined with an improved disability program for those with demanding physical jobs.

• John Rother opposes a further increase until the effects of the increase to 67 have been thoroughly analyzed. He also said any increase should be accompanied with policies promoting expanded job opportunities for older workers and incentives that encourage older workers to extend their working careers.

  He said most people retire early and will continue to do. The increased retirement age would, therefore, result in an across-the-board benefit cut.

  He also noted potential inequities: African-American men would be disproportionately hurt due to their below-average life expectancies; women would be disproportionately affected due to their greater reliance on spousal benefits; people in poor health and in physically demanding jobs would be hard pressed to continue working to the higher age; and age discrimination and lack of job opportunities would make it difficult to work longer.

• Ann Combs noted that life expectancy has increased drastically since the Social Security program was established. If the retirement age had been indexed to increases in life expectancy, the current retirement age would be over 70. But she noted that the public wants to retire earlier – not later.

  She recommended a more flexible policy toward retirement that includes an option to retire with the deferred collection of benefits. The incentives could include increased benefits for delayed collections, partial benefits (combined with private pensions), and the repeal of the earnings limit for retirees.

• Sam Beard said an option to consider is to eliminate or accelerate the hiatus on raising the retirement age so that by 2011 the retirement age will be 67. He said the essential safety net should be strengthened to protect low income workers with manual labor intensive jobs.

 

Public comments:

• noted that minorities have lower life expectancies than those in the "majority" and that those in the lower 20 to 40% of the economy would have less of a chance to survive until the retirement age.
• stated that 16% of the population (and increasing) lacks health care (insurance?), such that improved medical care will not improve the life expectancy of everyone.
• noted senior citizens' difficulty in getting and retaining jobs: "'Corporate America' just loves to fill their open positions with those in the 60 to 65 (or older) age group."
• the life expectancy differential between low- and high-income workers pretty much wipes out the progressivity of Social Security -- people with low incomes get proportionately higher benefits when they retire; but they don't live as long.
• recommended that Social Security be privatized, allowing each worker to choose their own retirement age.
• recommended privatization, stating that patching the on-size fits all unfunded system will revert back to the current situation with deteriorating demographics, eroding returns on contributions, and government control over the freedom and security of workers during retirement.

 

Ashley Schannauer