I'm glad to be participating as a panelist and thought I'd take a stab at trying to answer some of our moderator's opening questions. As you can see even though it's Tuesday, I'm still working on Monday's questions.
Before I get started, if you would like to know more about the work of my organization, the Institute for Women's Policy Research, please visit our web site at www.iwpr.org. We conduct research and analysis of many policy issues affecting women.
Maureen asked us about the purpose of the Social Security system, whether it was a safety net, a forced savings plan for retirement, or a form of elder care in the absence of the extended family? And if it is insurance, it is individual insurance or insurance for society as a whole?
I think the answer to all these questions is "yes."
It is clearly a safety net, since low earners get a higher proportion of their benefits back than high earners and since, for those still below poverty even with Social Security benefits, it can be supplemented with SSI (which comes for general revenues, by the way, not payroll taxes).
It is also a forced savings plan for retirement, at least for society as a whole, since the tax is mandatory. And because the employer pays 1/2 the tax, employers are forced to contribute. Many employers do not offer any other pension plan than Social Security. So, the mandatoty tax is a way that society is forced to provide enough for the retirement of older workers.
And it is the way the young take care of the old. Whether or not any elder has any relatives, her or his Social Security benefits will keep coming because all workers (young included) are paying into the system.
Maureen also asked if we could come up with some ways to give those who die young a better "pay off" and I hope we do think about that over the course of this panel.
Maureen, who is a very prolific questioner, also asked if men are paying too much since they die young? They are paying more, but not too much, since their benefits are going to surviving spouses, women. It is a system in which funds are transferred from men to women. Since we view marriage as an equal partnership, it makes sense to me that women not be left high and dry when their spouses die. Even with the spousal benefits, older single women are much more likely to be poor than older men.
