DEBATING SOCIAL SECURITY REFORM – Coursework Example
Social Security It is notable that the Social Security Fund is performing poorly in America. Many debates have been conducted on how to improve its performance. Any concrete debate on the Social Fund may consider the following points:
Raising the Retirement Age
Proponents of this explanation argue that life expectancies have grown. This implies that the beneficiaries collect benefits for longer time and thus they should also work longer. Increasing the eligibility age for the whole benefits is a method that is logical but could mean hardship for some ageing persons. These people have jobs that they do not want to do at the age of 68. In this case, it is controversial that this solution will not affect the age at which people retire, but reduces the amount of benefit they get at a given time.
Changing the Cost Of Living Calculation
In America, Social Securitys cost of living alteration is currently determined by using the customary Consumer Price Index. The CPI, however, attempts to expose how consumers change their spending styles in response to changes in prices of commodities. While this will suggest smaller benefits, it could specifically hurt older beneficiaries.
Privatizing the System
Though the logistics of changing over to private sector as the custodian of social security fund, it is one of the ideal ways of dealing with the issue at hand. Privatizing the fund would basically means that people are allowed to invest their money by themselves. By making private investment, they could bargain for higher rate of return. Though privatization would bring redemption to the government, the current retiree would suffer as they are already covered by the current state of affair.
Raising the Payroll Tax Cap
Having high earners pay a larger share into the system and Raising that cap could help to close the existing Social Security gaps. In this, the Social Security body will have enough money to investor in sectors with high returns.
Ronald. Dark Forces against Social Security: Princeton, N.J.: Princeton UP, 2008.