Essay - Social Security Introduction for Decades the United States Has Run...

Social Security

INTRODUCTION

For decades the United States has run a program currently called "Social *****." While most people think of it as retirement funds for older workers, less than 70% of payments go to retirees. 17% go to disabled ***** and/or their dependents, and another 14% go to the children of workers who have died and *****ir guardians (Toner, PAGE). When social security was first conceived, the world was in ***** throes of a devastating depression. Many people, including those who had previously been well *****f and ***** had anticipated no financial difficulties in their old age, suddenly had no savings and no investments. While other workers in the country could at least try to find a job, for those *****o old to work, *****y faced destitution.

PROBLEM

The problem with social ***** is that the depression did end, and the United States moved into a new era of prosperity, which contributed to a population boom. Today *****re are about 37 million people 65 or older. By the year 2035, there ***** number will have grown to 75 million, and those ***** can expect to live ***** the average age of 85. Thus m*****e people will receive social security benefits, resulting in more benefits paid. However, the number ***** younger people will ********** rise nearly as much (Reynolds, PAGE), so a lot more money will be ********** out of ***** social security system ***** ***** be coming in. Right now, ***** every person 65 or over who is retired, five younger ***** contribute ***** security taxes. However, by 2030 the numbers will have shifted to 3:1, and by 2080, the ratio will be close ***** 2:1. Unless we change how social security is ***** and funded, eventually the number of workers will ***** to pay twice as much in social security taxes ***** they do now to support the program (Reynolds, *****).

This "pay as you go" ***** worked well at first, with current workers pay*****g for the retirement benefits of older Ameri*****s, ***** the ***** confident th***** when it w***** time for them ***** retire, other *****orkers would provide the money ***** their benefits (O'Donnell, PAGE). And, it did work will until the United ***** experienced high levels of both unemployment and inflation in the late 1970's ***** early 1980's. Because social ***** ***** *****crease as wages incre*****e, as inflation drove wages up, it also drove up the cost of ***** security. By 1982, ***** trust fund balance was only about 90% ***** what was needed to pay current benefits. Social security had more debt than it ***** ***** and so was virtually bankrupt. The solution then was to change the system from "pay as you *****" to funding in advance. This *****ed well, ***** by 2008 the ***** fund should be over two trillion dollars (O'Donnell, *****). However, ***** spite of that growth, the balloon effect of retirees on the horiz***** along with a decrease in workers will ***** leave social security approaching *****cy again. *****'s discussions