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Schlaes: Early Retirees Killing Social Security

By    |   Thursday, 22 Oct 2009 10:54 AM

Columnist Amity Schlaes says that the U.S. is facing a Social Security crisis this fall as the number of early retirees is unexpectedly surging.

“In the 12 months ended Sept. 30, 21 percent more seniors opted to begin collecting their Social Security benefits than in the year-earlier period,” writes Schlaes on the Bloomberg wire.

“This was higher than the 15 percent increase actuaries forecast. Many signed up to collect cash at age 62, forgoing the significantly higher pension due to those who retire later in their sixties.”

The government may need to adjust the benefits to cope with this, but has not done so yet.

The Bush administration tried to reform social security during its first term but punted and worked instead on expanding Medicare prescription benefits.

Time ran out, however, and now there is the new Obama administration, which hasn’t put forth a reform plan either, just a patchwork payment of $250 per retiree this fall, and a spiking of the cost of living (COLA) adjustment for retirees.

Another reason a crisis is emerging now is that there is very effective political opposition to change from seniors, writes Schlaes.

“Bush’s largess for Medicare and inability to get through a Social Security fix reminds us is that seniors aren’t willing to consider even sound reform. They will go to the mat for a raise every time,” Schlaes notes.

This resistance to real change is “turning social security into welfare,” not a retirement program, writes David C. John, a senior research fellow at the Heritage Foundation, at Heritage.org.

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Columnist Amity Schlaes says that the U.S. is facing a Social Security crisis this fall as the number of early retirees is unexpectedly surging. “In the 12 months ended Sept. 30, 21 percent more seniors opted to begin collecting their Social Security benefits than in the...
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2009-54-22
Thursday, 22 Oct 2009 10:54 AM
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