Social Security

Stephen Goss, the Chief Actuary of the Social Security Administration once said, “The concepts of solvency, sustainability, and budget impact are common in discussions of Social Security, but are not well understood.” Social Security is an important federal program that provides a stable source of income to individuals who no longer have a constant salary due to retirement, disability, or death. This program, not only keeps millions of families out of poverty, but it also plays a vital role in the national economy. According to the research report, “Social Security’s Impact on the National Economy”, by Gary Koenig and Al Myles, Social Security supports millions of jobs. The importance of this program is clearly evident in both the national economy and in the economic stability of each individual state. However, the future of the Social Security program does not look very stable and the right decisions need to be made in order to ensure the solidity of the nations’ economy.

The baby-boomer generation is aging and adding more beneficiaries’ at an increasing rate than ever before and is estimated to impact the federal deficit by over 17% by 2020. Many other countries have National Healthcare that provides better care at a much lower cost. Medicare was the motivation for a universal healthcare plan and a program for the U.S. could have a positive impact. (Starr, 2011).

In “The Social Security Problem”, Max Moore discusses the fearful reality of Social Security running out of funds. He states that the U.S. Department of the Treasury predicts that Social Security funds will run out by 2041 and action must be taken in order to prevent this (134). In his essay, he explains how the depletion of Social Security funds are a result from a decreasing retirement age, decreasing fertility rate, and shrinking work force. These things contribute to an increased population relying on Social Security, an increased population of the elderly, and a decreased ratio of workers paying for those beneficiaries (135). Moore explains the proposal of George W. Bush to make Social Security partially privatized; allowing young workers to invest their retirement savings into their own account. This would result in people putting their retirement on the line in

Medicare Part D Drug Plan was created by Congress in 2003 to aid the elderly, disabled, and sick persons in affording their medication. Coverage for the drug plan went into affect January 1, 2006. This plan was called the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA) (Cassel, 2005). The final bill that passed, was influenced by drug-company and health insurance lobbyists and focused mainly on the needs of those industries instead of the seniors it was meant to serve (Slaughter, 2006). These plans are operated by insurance companies and some private companies that have been approved by Medicare. Part D is optional only if a person carries health insurance that includes prescription coverage. If at retirement

It has been recognized that ever since its passage into law the Affordable Care Act frequently known as Obamacare has and will continue to attract criticism and scrutiny. This is the America`s major and mainly well-liked social indemnity programs. Despite the fact the Affordable Care Act is a highly multifaceted piece of legislation featuring many regulatory and intergovernmental provisions meant to deal with lack of health insurance coverage affecting a variety of diverse groups, Medicare and social security are much more focused programs providing benefits primarily to the aged. Social security and Medicare were in the beginning implemented more without difficulty and with a little of bipartisan support, because in 1935 and 1965 democrats

Notably, the elderly populace is growing rapidly, and will reach 3.4 million or 12.8% of the population. Eventually, in the next thirty years older adults will comprise of 20% of the total population due to the aging of 76 million baby boomers (Olson, 2001). Seeing that, entitlement programs and means-tested benefits, are presented, in order to bolster this increment of older adults. Accordingly, around 96% of the American workforce is secured by Social Security and it is likewise estimated that 58 million American will receive a total of $816 billion in Social Security benefits (Moody and Sasser, 2015). In fact, today 56 million or 17% of the population is enlisted in Medicare (Leonard, 2015). Therefore, this has presented an open deliberation about the eventual fate of Medicare and Social Security and regardless of whether changing Medicare and Social Security to means-tested benefits, instead of entitlement programs can resolve the policy issues.

Social Security is facing pressure to lower benefits… due to longer life-spans, an overall population increase …the Baby Boomers beginning to reach retirement age, and the increase in the number of people receiving Social Security and Medicare benefits. If the system continues as-is, the total benefits will eventually surpass the amount of taxes paid into the system by younger workers. If the system is not altered at some point full benefits will not be paid as promised. (13)

In 2003, Congress approved what is known as Medicare part D which allowed for Medicare participants a prescription drug benefit. Up until this point one-quarter of beneficiaries had no coverage for their medications. Which is a crucial part of their healthcare. There are two plans under Part D, Prescription Drug Plan, for drug coverage only, and Medicare Advantage plan, which covers both medical services and prescription drugs (Poisal J., 2000).

Social security has become the largest governmental program in the United States, accounting for 24% of total US federal spending by 2015(Word cited). A proposal to replace the current social security of the government is the mandatory privatization in pension system, which will allow employees to manage their retirement funds through individual investment accounts. But due to the fact that privatized pension system will only be more detrimental including higher national debt, lower assured benefits than the current system, and the requirement of a new bureaucratic government.

Due to the upcoming presidential election, the two major political parties, and their candidates, have been focusing on the primary problems that the nation will face. Chief among those problems is the future of Medicare, the national health-insurance plan. Medicare was enacted in 1965, under the administration of Lyndon B. Johnson, in order to provide health insurance for retired citizens and the disabled (Ryan). The Medicare program covers most people aged 65 or older, as well as handicapped people who enroll in the program, and consists of two health plans: a hospital insurance plan (part A) and a medical insurance plan (part B) (Marmor 22). Before Medicare, many Americans didn't have health

The Social Security system, the people’s retirement system, is running out of money and it is time for it to be privatized. Since being created in 1935 by President Franklin D. Roosevelt, people have grown more dependent on Social Security for their retirement and the system can only be sustained for so long. In a 2015 Gallup poll, 46% of those polled said they “personally worry about the Social Security system.” The same Gallup poll also found that 36% of retirees expected Social Security to be a “major source” of their income in retirement. People are worried with good reason. The current system cannot sustain itself.

The growing concern regarding the financial security of Medicare is one of particular interest to the nearly 72 million baby boomers that become eligible for this government-assisted, and tax-payer bolstered, program over the next two decades. According to the U.S. Census Bureau (2010), there will be a rapid increase in baby-boomers between 2010 and 2030, as the entire baby boomer population move into the 65 years and over category (p.3). Political and financial revisions must be made to ensure the security of Medicare as the numbers of individuals paying into this program are soon to be surpassed by the number of individuals drawing-off this program (U.S. Census Bureau, 2010). The elderly are also at a disadvantage with transportation to health care visits, picking up prescriptions, and rehabilitation services. There needs to be an establishment of access not only to primary care providers, hospitals, and rehabilitation services, but access to other aspects of the health care system for the elderly population.

In reading the book “Social Security and the Family” I learned a lot about the system that I had no idea about before. The book was fact filled and almost fun to read the need to know information. I gained much knowledge in the specifics of why the social security system is in need of reform, and why it will be inadequate in the years to come. One of the reasons our social security system isn’t working is because, “Social Security was modeled on the single-earner, married-couple family” (1). Times have changed dramatically since then.

The reason Social Security promises to pay current and future workers much more than it takes in, this is because of the system’s generosity to early birth cohorts, generations of workers now retired or deceased (U.S. Department of Treasury, 11). Social Security paid these workers, benefits that exceeded their lifetime contributions by more than 13.6 trillion, and in order to finance this gap, later birth cohorts must receive benefits whose value is lower by the same amount (U.S. Department of Treasury,

(5) Currently SS funds are collected and distributed on a pay - as - you -go (PAYG) system in which Social Security taxes from individuals are immediately distributed by the means of the SS Administration as it sees best fit. This means that taxes collected are not reserved for the individual who has paid them: in Rose 2 the current state he or she must rely on those persons paying SS taxes during the time of their retirement (Becker). For a number of these characteristics and future issues, the Social Security System must be reformed or completely abolished to meet the needs of tomorrow. The leading concerns of Social Security that merits the immediate initiation of reform are the demographic and economic circumstances in the coming century. Even though "forecasting the economy and budget over such a long period is uncertain" there remain many "certainties" regarding problems facing Social Security in the first half of the 21st century (OMB, Budget Perspectives 23). The Federal Government's responsibilities extend well beyond "the five- or six-year window" that has restricted the focus of recent budget analysis and debate. Of these "certainties" are the mounting challenges posed from the baby-boomer generation. This generation, born in the years after World War II, is aging