New Posts

Heritage: 3 Simple Solutions for Fixing Social Security

New Posts
@stevenfoley

A former U.S.Marine, he is the Creator of The Minority Report Network. He is also the Founder and Managing Editor of the Network’s flagship site, www.theminorityreportblog.com, Former Director of New Media for Liberty.com, Former Director of New Media for Liberty First PAC, and the Former Chief Managing Editor of 73Wire.com. Steve is a well respected national conservative blogger who’s dedicated the past several years of his life advancing conservatism online. Recently Steve was instrumental in the development of Liberty.com, Liberty First PAC, The Patriot Caucus, the national campaign trail and grassroots news site73wire.com.

Originally posted at The Foundry by Rob Bluey

Later today the Republican-led House of Representatives will vote on “Plan B,” the latest unsatisfactory proposal put forward by Speaker John Boehner (R-OH) to avoid the fiscal cliff. Boehner’s plan would protect most Americans, except for millionaires, from a tax hike. But even this is a poor fix because it ignores the real problem: spending.

While lawmakers from both parties squabble over tax rates, a fiscal crisis is looming on the horizon. Entitlement programs — Social Security and Medicare to be precise — have unfunded obligations of $48 trillion. By comparison, the fiscal cliff carries a price tag of roughly $650 billion. As lawmakers talk about another debt-limit increase, they need to think seriously about America’s long-term obligations.

So what can our elected leaders do about it?

The first step is recognizing the problem exists, which for some Democrats is mighty difficult. A story in Politico reveals that liberals are having “heartburn” and doing “some painful soul-searching” over a relatively simple fix to Social Security’s annual cost-of-living increases.

Heritage’s David John, senior research fellow in retirement security and financial institutions, believes the time is ripe for a few Social Security fixes. Any fiscal cliff settlement, John writes in a new Heritage report, should address Social Security’s grim financial future.

The Problem

Over the next 75 years, Social Security will owe an estimated $11.3 trillion more in benefits than it will receive in payroll taxes. It has been running deficits since 2010, according to the Social Security Administration.

To make up the difference, Social Security will need “massive annual injections of funding in addition to what the program receives from payroll taxes,” John writes. Don’t believe the liberal myth that Social Security is on solid financial footing. The numbers don’t lie. It’s very much part of the spending debate facing Washington.

The longer Congress delays action, the harder it will be to solve the problem.

The Solution

There is already bipartisan support for two of the three ideas recommended by John. All three are simple fixes that should be included in any fiscal cliff deal.

1) Fix the annual inflation adjustment. The current index used to determine Social Security’s yearly cost-of-living adjustment does an inferior job of measuring inflation. A better solution is a “chained” index, which more accurately measures inflation. This change would immediately result in savings for Social Security. And it’s easy to do — the new index can be implemented quickly and without complication.

2) Increase the full retirement age. Americans are living longer thanks to advances in medicine. And yet Social Security has not kept pace. The important number here is the how much longer people who have reached age 65 will live. That number is trending upward, by nearly a year, according to recent government data. Congress should gradually increase the full benefits age to 68 and then index it to life expectancy in the future.

3) Focus benefits on those who most need them. It’s time to return Social Security to one of its original purposes: protecting seniors who face economic hardship. In order to make Social Security a true insurance program, upper-income seniors would face reduced benefits or none at all. This would strengthen the program’s finances and prevent future tax hikes on younger workers.

There’s more to do beyond these three solutions, but they would provide a solid foundation for future reforms. Heritage’s plan, Saving the American Dream, redesigns Social Security and other entitlement programs to guarantee assistance to those who need it — and keep the American dream alive for future generations.

Read More:

Three Social Security Fixes to Solve the Real Fiscal Crisis

Saving the American Dream: Social Security

Six Bipartisan Entitlement Reforms to Solve the Real Fiscal Crisis

More in New Posts

Air_Force_One_over_Mt._Rushmore 4

Obama Star-Grazing Trip Costs A Cool Million

Streetwise_ITDec 18, 2014
14-1218 - Transparency

IRS Watchdog Continues to Hide Records on White House Leaks

Michael BeckerDec 18, 2014
14-1218 - Hands Up

The “Hands Up Don’t Shoot” Movement Needs to Cause Trouble

Michael BeckerDec 18, 2014
kim-jong-un-super-soaker

#EveryoneMakeFunOfKimJongUnDay

stix1972Dec 17, 2014
there-goes-our-movie-sony-pict

Is America wimping out? Sony and Major Theaters in U.S. won’t show “The Interview” because of threats.

tmradminDec 17, 2014

The Minority Report is a network of websites devoted to Conservative & Libertarian politics in the United States.

On this site you'll find posts & links to some of the best and most comprehensive center-right news and opinion on the net...

December 2012
M T W T F S S
« Nov   Jan »
 12
3456789
10111213141516
17181920212223
24252627282930
31  

Archives

Copyright © 2014 The Minority Report Network