01 May 2005 Social Security Reform for All Retirees, Present and Future, by Ak’bar Shabazz
Social Security is in dire condition. Most agree that benefits for present retirees should be protected. At the same time, it’s equally important to make sure younger generations – future retirees – see a return on the billions of dollars withheld from their paychecks.
Many Americans are rapidly approaching retirement age and Americans generally are living longer, yet the income Social Security generates won’t provide sufficient benefits for future retirees. Workers nearing retirement are understandably resistant to reform and nervous about being left out in the cold without Social Security, but who and what will protect tomorrow’s retirees?
While some liberals believe the government should simply raise taxes or print more money to pay for benefits, these actions would not solve the problem. What we have here, ladies and gentlemen, is a basic conflict of ideology, a microcosm of a larger philosophical debate. The question is, whose money is it?
Liberals think that money collected by the government belongs to the government instead of to those who earn it. This view may seem reasonable to those wanting to control another’s destiny, but it hardly makes sense to one who strives to control his own.
Working Americans relinquish enough hard-earned money in taxes. Some of it should be used to build wealth.
“Allowing individuals to build their own wealth is an integral part of a market economy. Economists believe that Social Security provides a disincentive to save,” writes Norbert J. Michel, a policy analyst at The Heritage Foundation and an expert on how policy decisions affect saving, spending and investment practices. Relieving the tax burden and providing savings alternatives would encourage younger workers to invest their hard-earned money.
Most taxpayers “investing” in the current Social Security system, especially African-Americans, will never fully realize their return. According to the Cato Institute, the average worker will probably get a rate of return of less that two percent. Unfortunately, some politicians choose to ignore the facts for fear of making an enemy of the largest, most powerful special interest organization in the country, the American Association of Retired Persons (AARP).
AARP is quite clear in its intention to fight the personalization of Social Security.
William Novelli, AARP’s chief executive officer, said his organization is “dead set against carving out private accounts out of Social Security taxes.” The AARP has already invested millions in advertising to denounce President Bush’s plan. These members of “The Greatest Generation” apparently believe their own retirement security is more important than future generations.
Savvy legislators aware of voter statistics realize seniors are the most reliable voters. Seniors are more likely to pay attention to current affairs and go to the polls. In contrast, many young Americans are apathetic and unaware of important policy debates that affect them. As video games and music videos consume their attention, they dismiss things that directly affect their future.
Politicians may hold up a finger to the wind and realize it’s blowing harder toward AARP than other groups. MTV seems the closest thing to a young person’s special interest group. The chances of developing a national youth movement to combat the AARP’s anti-reform campaign are slim. Consequently, some politicians want to brush Social Security reform under the rug, pacify AARP, maintain the status quo and hope someone else solves the crisis.
Ignoring the need to reform Social Security threatens the future of our youth and the entire country. A mandate to current workers to finance the retirement of older workers while discounting their own future is an irresponsible one. People must have the choice to allocate at least a small percentage of their Social Security withholdings to fruitful and inheritable investments.
Present retirees should not be the sole arbiters of retirement policy. Forcing today’s workers into tomorrow’s bad financial plan will produce a higher retirement age and lower retirement savings. Politicians must disregard the AARP’s pandering and help secure positive retirements for all Americans.
Don’t count on MTV to provide this kind of leadership.
Published by The National Center for Public Policy Research. Reprints permitted provided source is credited. New Visions Commentaries reflect the views of their author, and not necessarily those of Project 21.