Jay Bookman

Opinion columnist and blogger with The Atlanta Journal-Constitution, specializing in foreign relations, environmental and technology-related issues

Pushing retirement back to age 70?


Jeb Bush has joined Chris Christie and Marco Rubio in advocating an increase in the Social Security and Medicare retirement ages in order to "save" both programs.

"We need to look over the horizon and begin to phase in, over an extended period of time, going from 65 to 68 or 70," Bush said on "Face the Nation" Sunday.

I'm not sure if Bush is aware of the fact -- his comments suggest that he is not -- but full retirement has already been extended beyond age 65. Thanks to the last effort to "save Social Security" back in 1983, the full retirement age is now 66, and it is scheduled to rise gradually to 67 by 2022. And while early retirement is still available at age 62,  the financial penalty for taking that option has increased significantly.

Bush made the statement about Social Security during an interview with Bob Schieffer, the 78-year-old CBS newsman who was taping his last episode of "Face the Nation" before his own retirement. Schieffer's longevity would seem to make him a good example of extended, healthier American lifespans, a trend often cited by those who support pushing back the retirement age. But I would argue that such an example is deeply misleading.

With all due respect to Schieffer, sitting in an air-conditioned office staring into a TV camera at age 68 or even 78 is significantly easier on the body than working as a carpenter, retail clerk, truck driver or other blue-collar profession at an advanced age. For a lot of Americans, working past age 65 would be a considerable physical and emotional hardship.

In addition, lower-income Americans already live significantly shorter lives than their wealthier fellow citizens.

At age 55, an American male in the top 10 percent of the income scale will on average live almost 11 years longer than an American male of the same age at the bottom 10 percent of the income scale, and that lifespan differential is growing. The increase in average lifespan that is often cited to justify later retirement is almost exclusively a phenomenon among those at the upper end of the payscale.

The story among American women is even worse. Among women in the bottom 40 percent of the income scale, average lifespans are actually falling, rather than increasing. A woman at the bottom end of the income scale who turned 55 in 1995 can expect to live two years LESS than her mother did at the same age, for reasons that we can only guess.

These are the people who would be most affected by the changes sought by Bush and his fellow Republicans. These are people don't have 401ks, hefty savings or pensions to fall back upon to finance an early retirement without Social Security; if they're lucky, they have Social Security and a house with a paid-off mortgage. (Fewer than 45 percent of American workers even have a 401k account, and most who do are woefully underfunded.)

To Bush and his colleagues, however, asking such folk to "save" Social Security by working another two or three years, to age 70 -- a tax on life itself, so to speak -- is clearly preferable than some of the alternatives, most of which involve slight tax increases on income. You could, for example, increase or even eliminate the cap on income subject to Social Security payroll taxes, which now disappear after the first $118,000 in earned income. Earlier this year, Sen. Bernie Sanders proposed a variation on that idea by keeping that cap, but reinstating the payroll tax to income above $250,000. Other proposals include gradually raising the 6.2 percent payroll tax to 7.2 percent or slightly adjusting the cost of living formula, which President Obama has been open to discussing.

Bush and Christie have also suggested means-testing Social Security, thus reducing benefits for wealthier Americans and saving a considerable sum of money. Personally, I don't have a problem with that idea, depending on its details, but defenders of Social Security worry that means-testing would make the program look more like a welfare program than a social insurance program, and thus undercut its long-term political support.

I wish I could say with certainty that such a change wouldn't matter, but given the state of modern politics, I do see their point.

 

 


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About the Author

Jay Bookman writes about government and politics, with an occasional foray into other aspects of life as time, space and opportunity allow.