As speculation is rising that Obama may well betray past promises and join in with Republicans to cut Social Security, purportedly in order to "save" it, it's worth highlighting the fact that benefit levels are already quite low compared to most other countries. The following chart put together by the Center of Budget and Policy Priorities is from the January 11 report, "Social Security Benefits are Modest " by Kathy Ruffing and Paul N. Van de Water:
As you can see, Social Security actually averages about 2/3rds of the international average--around 40% of wages compared to about 60% as the international average. That's a tremendous shortfall. Meanwhile, our super-rich continue making far, far more than similarly-situated individuals in other countries, while contributing nothing extra at all to Social Security.
The report's key findings:
In assessing Social Security proposals, policymakers need to keep five key facts in mind:
1.Social Security benefits are quite modest.
2.The majority of beneficiaries have little significant income from other sources.
3.For most seniors, Social Security is the only income they will receive that is guaranteed to last as long as they live and to provide full inflation protection.
4.Social Security benefits in the United States are low compared with other advanced countries.
5.Future retirees already face lower benefits (relative to their past earnings) than current retirees as a result of a rising Social Security retirement age and escalating Medicare premiums.
All of those facts argue for limiting any cuts in future benefits - a position that the majority of the public appear to support.
Clearly, we should be talking about increasing Social Security benefits, rather than cutting them. If most other countries find a way to make their retirement insurance programs 50% more generous than ours (60% = 1.5 * 40%), then surely we can too. Our greatest deficit is a deficit of political will.