By Susan Nielsen
I 'm a Generation Xer with 30 years until retirement, houseguests on the way and a Christmas tree still up in the living room. Brooding about Social Security isn't a top priority for me, like most others in my demographic.
So thank goodness for the senior citizens fighting the latest proposals to dismantle Social Security. While those of us in our 20s and 30s stay busy balancing work and family, celebrating the return of carbs and watching "Desperate Housewives," retirement-age people are watching our backs.
The proposed changes wouldn't affect today's senior citizens, as President Bush and other would-be reformers repeatedly say. But the AARP and other groups that speak for retirees, elderly women, minorities and disabled people are fighting back anyway. Older generations know better than younger ones what Social Security is supposed to be: Society's insurance against poverty for the elderly and disabled.
Not a get-rich plan. Not a personal entitlement.
It's a collective benefit that guards against individual hardship. And it works. Social Security is more successful, easier to understand and in better financial shape than any other major federal program. It also has fewer built-in advantages for wealthy people or white men than your typical government benefit.
On second thought, maybe this attack shouldn't be so surprising.
Social Security's biggest crisis came in the early 1980s, when Generation Xers were still kids wearing parachute pants and watching Michael Jackson's "Thriller" video. The system was in trouble, with too many retirees, too few workers and too much inflation. Congress fixed the problem by raising payroll taxes and tweaking benefits.
Workers and business owners hated the tax increase, but the reforms allowed Social Security to do two jobs at once: Underwrite the old age of the Greatest Generation while setting aside extra billions to subsidize the looming retirements of baby boomers.
Little of this registered with us Generation Xers, other than as white noise: Blah blah Social Security blah blah crisis blah bankrupt. We headed to college, rocked out to Pearl Jam and entered the work force.
The mid-1990s brought more talk that Social Security didn't have enough money to cover the long-living boomers. Generation Xers greeted that news flash with a big whatever, since this doom-and-gloom talk was all we'd ever heard.
In the later 1990s, some wanted the government to invest Social Security funds in stocks. That idea didn't fly. Enough people remembered that Social Security, signed into law by President Roosevelt in 1935, came in response to the unexpected collapse of the stock market.
Meanwhile, tortoise-like Social Security stockpiled billions. The Congressional Budget Office now says the program's extra revenue will cover all benefits though 2052 -- and most benefits after that. Surviving baby boomers will be in their 90s and 100s. Generation Xers will be in their 70s and 80s. (My Christmas tree should be down by then.)
Isn't this odd? Other parts of the federal government aren't fully funded through tomorrow, let alone for another half-century. Yet President Bush has singled out Social Security as the nation's biggest crisis.
Bush hasn't revealed his specific plan yet, but he speaks favorably about two changes. One would divert part of workers' payroll taxes into private accounts. That would come with an estimated $2 trillion in so-called "transition costs" that would push the nation further into debt. Backers of this idea say private accounts would more than make up for the cuts in regular Social Security benefits -- assuming the stock market acts like it did in the 1990s.
The other big idea with Bush's support is to change the way people's benefits accumulate during their working years. People retiring several decades from now would see much smaller checks under this cost-cutting change.
But don't worry, Bush tells people in their 50s and above. "First, nothing will change for those who are receiving Social Security and for those who are near retirement," he said in a December radio address.
It's a interesting tactic: Lull the parents and grandparents to sleep, then lunge for the jugulars of the children and grandchildren. Fortunately, it's not working.
Last week, the senior-citizen advocacy group AARP kicked off a massive ad campaign opposing any deep cuts to benefits for future generations. Groups representing women, disabled people and minorities also warned against deep cuts or stock-market gambles: These people depend on Social Security as their sole income more often than able-bodied white men.
Enough opposition from senior citizens will kill Bush's plans. That could turn attention to the more reasonable ideas in Congress. One idea with bipartisan backing would apply the payroll tax to all wages up to $200,000, up from the new ceiling of $90,000. That's a fair way to make Social Security solvent even longer -- by asking the wealthy to pay the same rate as the middle class.
I'll stop now, before boring my fellow thirtysomethings with plans that will change dozens of times before any of us retire. But right now, the system works pretty well: Gen Xers pay a higher payroll tax to finance the retirements of our elders, and our elders fight for us when they see us and our Gen Y friends likely to get creamed down the road.
By looking out for each other, everyone stays out of deep poverty.
Bush may not like it. But Roosevelt would be proud.
I 'm a Generation Xer with 30 years until retirement, houseguests on the way and a Christmas tree still up in the living room. Brooding about Social Security isn't a top priority for me, like most others in my demographic.
So thank goodness for the senior citizens fighting the latest proposals to dismantle Social Security. While those of us in our 20s and 30s stay busy balancing work and family, celebrating the return of carbs and watching "Desperate Housewives," retirement-age people are watching our backs.
The proposed changes wouldn't affect today's senior citizens, as President Bush and other would-be reformers repeatedly say. But the AARP and other groups that speak for retirees, elderly women, minorities and disabled people are fighting back anyway. Older generations know better than younger ones what Social Security is supposed to be: Society's insurance against poverty for the elderly and disabled.
Not a get-rich plan. Not a personal entitlement.
It's a collective benefit that guards against individual hardship. And it works. Social Security is more successful, easier to understand and in better financial shape than any other major federal program. It also has fewer built-in advantages for wealthy people or white men than your typical government benefit.
On second thought, maybe this attack shouldn't be so surprising.
Social Security's biggest crisis came in the early 1980s, when Generation Xers were still kids wearing parachute pants and watching Michael Jackson's "Thriller" video. The system was in trouble, with too many retirees, too few workers and too much inflation. Congress fixed the problem by raising payroll taxes and tweaking benefits.
Workers and business owners hated the tax increase, but the reforms allowed Social Security to do two jobs at once: Underwrite the old age of the Greatest Generation while setting aside extra billions to subsidize the looming retirements of baby boomers.
Little of this registered with us Generation Xers, other than as white noise: Blah blah Social Security blah blah crisis blah bankrupt. We headed to college, rocked out to Pearl Jam and entered the work force.
The mid-1990s brought more talk that Social Security didn't have enough money to cover the long-living boomers. Generation Xers greeted that news flash with a big whatever, since this doom-and-gloom talk was all we'd ever heard.
In the later 1990s, some wanted the government to invest Social Security funds in stocks. That idea didn't fly. Enough people remembered that Social Security, signed into law by President Roosevelt in 1935, came in response to the unexpected collapse of the stock market.
Meanwhile, tortoise-like Social Security stockpiled billions. The Congressional Budget Office now says the program's extra revenue will cover all benefits though 2052 -- and most benefits after that. Surviving baby boomers will be in their 90s and 100s. Generation Xers will be in their 70s and 80s. (My Christmas tree should be down by then.)
Isn't this odd? Other parts of the federal government aren't fully funded through tomorrow, let alone for another half-century. Yet President Bush has singled out Social Security as the nation's biggest crisis.
Bush hasn't revealed his specific plan yet, but he speaks favorably about two changes. One would divert part of workers' payroll taxes into private accounts. That would come with an estimated $2 trillion in so-called "transition costs" that would push the nation further into debt. Backers of this idea say private accounts would more than make up for the cuts in regular Social Security benefits -- assuming the stock market acts like it did in the 1990s.
The other big idea with Bush's support is to change the way people's benefits accumulate during their working years. People retiring several decades from now would see much smaller checks under this cost-cutting change.
But don't worry, Bush tells people in their 50s and above. "First, nothing will change for those who are receiving Social Security and for those who are near retirement," he said in a December radio address.
It's a interesting tactic: Lull the parents and grandparents to sleep, then lunge for the jugulars of the children and grandchildren. Fortunately, it's not working.
Last week, the senior-citizen advocacy group AARP kicked off a massive ad campaign opposing any deep cuts to benefits for future generations. Groups representing women, disabled people and minorities also warned against deep cuts or stock-market gambles: These people depend on Social Security as their sole income more often than able-bodied white men.
Enough opposition from senior citizens will kill Bush's plans. That could turn attention to the more reasonable ideas in Congress. One idea with bipartisan backing would apply the payroll tax to all wages up to $200,000, up from the new ceiling of $90,000. That's a fair way to make Social Security solvent even longer -- by asking the wealthy to pay the same rate as the middle class.
I'll stop now, before boring my fellow thirtysomethings with plans that will change dozens of times before any of us retire. But right now, the system works pretty well: Gen Xers pay a higher payroll tax to finance the retirements of our elders, and our elders fight for us when they see us and our Gen Y friends likely to get creamed down the road.
By looking out for each other, everyone stays out of deep poverty.
Bush may not like it. But Roosevelt would be proud.
