Tags: Samuelson | elderly | Social Security | income

WaPo's Samuelson: 'Stop Coddling the Elderly'

By Michael Kling   |   Tuesday, 05 Nov 2013 07:46 AM

The popular image of the elderly is someone who is poor, sickly and vulnerable. But it's just a stereotype, a huge myth that protects government subsidies, says Washington Post columnist Robert Samuelson.

The reality is many seniors are financially comfortable, healthy and self-sufficient, he writes, pointing to a study by the Federal Reserve Bank of St. Louis. The persistent stereotype supports spending for Social Security and Medicare.

Continuing the stereotype, Samuelson asserts, is a political propaganda that stymies debate and political reform of entitlement programs that are becoming more and more costly.

Editor’s Note:
Retirees Slammed with 85% Pay Cut (New Video)

"It discourages us from asking: Are they all desirable or deserved? For whom? At what age?" he notes.

"No one wants to be against Grandma, who — as portrayed in the media — is kindly, often suffering from some condition, usually financially precarious and somehow needy. But projecting this sympathetic portrait onto the entire 65-plus population is an exercise in make-believe and, frequently, political propaganda."

The St. Louis Fed study shows that the elderly are growing richer, while the young and middle-aged are growing poorer. Median incomes for the families under 40 dropped 12.4 percent to $39,644 in 2010 from 2007. Incomes fell 11.9 percent to $56,924 for those 40 to 61 years old. But seniors aged 62 to 69 saw their incomes increase 12.3 percent to $50,825, and those 70 or older saw their incomes increase 15.6 percent to $31,512.

The entitlements, he says, are increasingly become a wealth transfer from the disadvantaged young to the wealthy elderly.

Long-term gains have been even more startling, he adds. From 1989 to 2010, median income increased 60 percent for 62 to 69 years old, but dropped 6 percent for those under 40 and 2 percent for those 40 to 61.

Reasons for the trend are not clear, but the study's co-author suggests that Social Security payments and pensions are a factor.

"We need to stop coddling the elderly. Our system of aid to the elderly — mostly, Social Security and Medicare — has a split personality."

The programs are a safety net for the elderly yet also provide payments to financially comfortable seniors who could easily live without subsidies, Samuelson says.

"The idea that Social Security and Medicare spending should be defended to the last dollar — as advocated by many liberals — is politically expedient and intellectually lazy," Samuelson charges.

Sen. Bernie Sanders, I-Vt., takes a different view in an editorial for USA Today.

Social Security is not going broke, Sanders claims. It's projected to have enough funds for the next 20 years. To keep it solvent for the next 50 years, Sanders recommends applying payroll taxes on annual incomes over $250,000. The Social Security tax now stops at $113,700.

To reduce Medicare and Medicaid costs, he argues, we should make health care more efficient and implement a national health care program.

Editor’s Note: Retirees Slammed with 85% Pay Cut (New Video)

Related Stories:

© 2015 Newsmax Finance. All rights reserved.

1Like our page

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved