There's no need to force people to work longer by raising Social Security's retirement age. Many Americans already are doing so -- by choice.
President Obama's debt commission appears set to recommend a gradual increase in Social Security's retirement age, perhaps to 70, to help bring the system's finances into long-term balance. But why use sticks when carrots could do? Making it easier and more appealing for more people to keep working could help balance the system's books while minimizing any benefit cuts.
The continued tax revenue from longer working lives makes such a voluntary initiative a serious policy option. Raising the median age at which Americans actually leave the workforce to 67 -- already Social Security's "normal retirement age" for those born in 1960 or later - would cut Social Security's long-term shortfall nearly in half, according to Stephen Goss, Social Security's chief actuary.
Of course, most people won't extend their working lives in order to rescue Social Security. They'll stay on the job, or find a new one, to bolster their personal financial security. Or to stay connected, make a contribution or pursue a passion.
The trend is well underway. In 1988, about 55 percent of Americans aged 55 to 64 were still in the labor force; now, nearly 65 percent are. Among people aged 65 to 74, the percentage who are still working (or seeking to) has climbed from 16 to 25.
"Folks are making these employment arrangements already," Sen. Max Baucus (D-Mont.), chairman of the Senate Finance Committee, said at a hearing in July on "Choosing to Work During Retirement and the Impact on Social Security" that was called to "examine whether we can make it easier for these arrangements to happen."
Unlike an across-the-board increase, a voluntary initiative would take advantage of the increased longevity and better health that allows many people to work longer, without disadvantaging those who can't or don't want to.
Small changes in Social Security could nudge people to re-up rather than retire. Employers could adopt more flexible arrangements that allow employees to work part-time or part-year. Reformed pension rules could enable people to draw partial benefits as they reduce their hours.
New "encore career" opportunities that last seven, 10 or even 15 years could boost the average retirement age even more dramatically. Investments in career-transition programs at community colleges and new financial services -- call them "Individual Purpose Accounts" -- could help people prepare for their encore transitions. "Encore fellowships," such as those authorized in last year's Edward M. Kennedy Serve America Act and those already offered by a handful of companies could help people make the switch.
A public-private encore career initiative could catalyze accessible and attractive work opportunities by making the talent and experience of older Americans central to fulfilling national priorities in health, education, energy and other areas. Patient navigators, adjunct teachers, job trainers, youth mentors and the like could help reduce health care costs, increase graduation rates, cut energy use and meet other common goals.
By emphasizing personal satisfaction and social contribution, encore careers help redefine working longer as an aspiration, not a punishment. The debt commission, which is due to issue its report in December, can accelerate the beneficial trends by calling a generation to its encore.
The commission may understandably be loath to credit any revenue windfall from such a dramatic shift in social behavior. But what if the commission let us put our labor where our mouths are? By delaying any recommended hike in the retirement age, policymakers could see whether Americans are indeed opting to work longer on their own.
By choosing to work longer, those who are able and willing could help themselves and their communities, and help preserve Social Security as well.
David Bank is vice president of Civic Ventures, a think tank on boomers, work and social purpose.
The original intent of the Social Security program, begun during the Great Depression, was to get older people out of the job market in order make room for hugh number of people with families to feed and no employment. That need is almost as great today as it was then.
So Wal-Mart (among others) hire older people at minimal wages and doesn't have to supply them with benefits because they have Medicare and Social Security to supplement their income. But that keeps jobs from going to younger people who have neither Medicare nor Social Security (although I have read that the pay is so low that many of them have Medicaid).
We do not need to improve the financial status of Social Security. That program is doing just fine. We do need to fix Medicare, but that can be done only by bringing general medical costs under control and that will happen only when the insurance companies are not taking such a large proportion of our health care budget.
Full disclosure: I am a 68 year-old woman with a good full-time job who loves working.
You are already working at 68 and you love it. Some are willing to take the cut in their benefits to quit work at 62.
It is silly for the government to push for age 70 retirement because the young will need them out of the way so they can have their jobs.
Sixty Minutes produced a segment on the 99ers - focused on long-term unemployment and impacts on older workers. Interestingly, it was framed in the center of the high tech industry and one of the apparently most stable, populous and prosperous regions in the country. This underlying story was discouraging, and it provides an epilogue to your discussion of the downward slide of the middle class.
As you and usna73 suggest, the domestic economy is a mess - but the mess is not limited to the United States. As I see it, we have two choices: we can resign ourselves to the natural conclusion of the dismal course that we are following, or we can invest in creating a rosy future. (We can hope that our own little worlds hold together until we are gone, or we can work towards solutions). My own preference is to press for a new level of accountability in manufacturing and financial industries (as well as markets that include journalism, media and politics).
Along with the author's, my thinking may be unrealistic and impractical but constructive direction seems to have far more potential than the alternative.
You have good ideas, but they are the chapter that comes after the national industrial policy necessary to change the course of disaster we already face.
It won't though ; it will simply delay the inevitable for a few more years.
And it only acheives temporary balance because more elderly unemployed will die before they can claim their SS.
"Raising the median age at which Americans actually leave the workforce to 67 -- already Social Security's "normal retirement age" for those born in 1960 or later - would cut Social Security's long-term shortfall nearly in half, according to Stephen Goss, Social Security's chief actuary."
Half a massive number is still a massive number.
Most all of us know someone in that situation who has been told that she is overqualified or that he will be unhappy working with/for a younger manager, most likely for less money hand he earned previously.
But these excuses are simply convenient ways to discriminate against the aging portion of the workforce who are penalized because they can neither collect Social Security early or enjoy the "luxury" of earning a wage and additional Social Security.
That's the biggest flaw in this plan of working us all to death. There just aren't enough jobs for Americans to keep working until they're 70.