At least one economic forecaster believes that Social Security is decades from an actual crisis.
According to economic policy expert Dean Baker, "There has been a real effort to scare people by calling it a crisis, and the reality is that the Social Security program is a model program."
Yesterday, Baker and Rep. Chaka Fattah (D-Pa.) spoke at the Law School to dispel rumors and common misconceptions about the program.
Baker is the co-director of the Center for Economic and Policy Research -- a nonpartisan agency that presents findings of professional research to inform the public on issues in major policy debates. He has been studying the Social Security issue for more than six years.
President Bush is currently traveling the country promoting his Social Security reform plans. He says that by 2031, there will twice as many elderly as there are today, putting a strain on the program. The administration also believes that inaction may have far-reaching implications for today's youth -- in the form of increased taxes, decreased benefits or both.
Yet Baker says that the current program does not need to be fixed.
"According to the Congressional Budget Office, the program can pay every penny of benefits right through the year 2052 if we did absolutely nothing," Baker said.
He added that there is already a government plan in place to handle the increased number of retirees.
In the last major reform of the Social Security system, in 1983 under former President Ronald Reagan, Congress was well aware of the baby boomer generation and deliberately raised taxes to a level above what was needed to fund the program. The tax increase went to setting up a trust fund to help pay for the baby boomers when they retired. The fund now stands at $1.7 trillion, Baker said.
According to Bush, by 2033, the program will need an extra $200 billion a year to continue paying benefits. However, Baker said this problem was the reasoning behind the trust fund's establishment.
In an interview, Baker stressed that Social Security is an issue that young people should be concerned about.
According to Baker, young people have a immediate interest in the program because it has a direct effect on their parents.
"If you want your parents to be independent in their retirement years, Social Security will be a big part of that," Baker said, adding that before Social Security, the welfare of the elderly often depended solely on their children.
Another lesser-known benefit of the program is that it provides disability benefits during "your working lifetime, so it is in effect an insurance policy," Baker said.
Fattah said that the current administration has not submitted a bill to congress yet on the issue of Social Security. He believes that the president is simply "working the issue in sound bites."
Law student Katherine Minarik said that it is important to address the issue of Social Security.
She commented that it was important to have a nonpartisan expert address the issue because "no one really knows the numbers behind the rhetoric."
