After President Obama's debt commission, Social Security is becoming a popular target for fiscal hawks. But Social Security will never add a dime to the debt, and Washington ought to be paying more attention to an actual crisis: the retirement income deficit.
Washington is panicking over the national debt. Powerful members of Congress, spurred on by recommendations made by some members of President Obama’s recently concluded fiscal commission, are planning an aggressive legislative agenda to balance the books. Part of this strategy is attacking Social Security.
Workers and retirees alike should be alarmed.
Focusing on Social Security cuts is misguided on two counts. First, it wrongly assumes that Social Security is going broke and causing a long-term fiscal crisis. Second, it ignores a much more urgent financial crisis in our midst: the retirement income deficit – representing the gap between what people have saved for retirement today and what they would need to have saved by today to meet a basic threshold of adequacy in retirement.
If the new Congress is serious about both protecting economic security for older Americans and getting the economy back on track, the last thing we should do is cut Social Security. We should strengthen it, and work to create a new reliable private retirement income system on top of it.
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