Raising Social Security age not a fair fix
Would raising the Social Security age fix the system?
Not in an equitable manner, says Gary Burtless, a senior fellow at Brookings Institution, armed with data showing that lower-income people tend not to live as long, and thus do not collect as much from Social Security.
In fact, Social Security favors the “One Percent,” who have more income and better health care. As a result, high-income Americans live longer and thus reap more benefits from Social Security.
Full benefits begin at 65 or 66 for those born between 1943 and 1954. Americans can begin collecting as early as age 62, but with benefits reduced up to 30 percent, according to the Social Security Administration.
Retirement planners advise waiting until age 70 to claim Social Security, but lower-income Americans argue that they can’t afford to.
The life span gap between rich and poor is widening, according to the study by Burtless, Barry Bosworth, and Kan Zhang.
They found life expectancy for the bottom 10 percent of male wage-earners turning 66 has risen 0.7 years compared with what was expected for their low-income counterparts 30 years ago. For the top 10 percent of male wage earners, however, their life spans rose 8.1 years in the same period.
The richest Americans gained three years of life expectancy from 2001 to 2014 alone, while the poorest had little gain (0.3 years).
“Improvements in life expectancy have been highly unequal, and low-income workers have experienced much smaller gains in life expectancy when compared with workers further up the income scale,” said Burtless, co-author of the report “Later Retirement, Inequality in Old Age, and the Growing Gap in Longevity Between Rich and Poor.”
“This argument (raising the retirement age) would be more convincing if increases in life expectancy were spread evenly across the workforce. They are not,” he said.
“It seems unfair to ask low-earners to take a benefit cut to pay for the added benefits high-earners enjoy because of longer life spans,” Burtless said.