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Reform Thursday: Week Sixteen.

Thursdays are good days for reform, because they fall between Wednesdays and Fridays.

That's why WILLisms.com will display a chart or graph, every Thursday, pertinent to Social Security reform. The graphics are mostly self-explanatory, but we include commentary on some of them where and when necessary.

Today's graph deals with The Graying of America. The United States population is getting older. Everyone knows that. Miracles in science and medicine are enabling people to live longer, fuller lives. In the meantime, birth rates, once producing a population resembling a pyramid, with ever-increasing numbers of people at the base, have shifted, meaning there are simply less younger people to support the retirees.

Here is a graphical example of the projected ratio of older Americans to younger Americans:

Click for larger version.

This proves many reform points, primarily that action is necessary now. Policy-wise, each passing year Social Security is not reformed, it adds a significant burden to the system (the Social Security Administration Actuaries estimate that figure to be 600 billion per year). But politically, as the population becomes older, gaining traction for reasonable reform will become nearly impossible:

A favorite question of critics of reforming Social Security is: Why act now, when there is no problem let alone crisis? The first baby boomers will begin to retire in three years. The fraction of voters receiving benefits will increase 50 percent in 20 years, and double in 50, relative to the fraction of voters paying taxes, making reform ever more difficult. And, once delayed, reform is ever more likely to lead to vastly higher taxes without slower benefit growth.

With reform now, by the time the demographics really bite in two or three decades, the solvency problem will be solved and families and the economy will have time to adjust gradually without severe disruption. If we wait and make changes abruptly, with gigantic tax increases or benefit cuts or some combination all at once, wrenching adjustments would be required for beneficiaries, taxpayers, and the economy. Thus, reform really is urgent. Enacting these sensible reforms now would strengthen the economy, spare future retirees and taxpayers disruption in their personal finances, and ensure Social Security plays an important and appropriate role in future retirement income security.

And, just a bonus reminder, Social Security starts paying out more than it takes in in 2017. That's just 3 Olympics, just 3 Presidential elections, just 2 Senate terms, from now (click for larger version):

Source:

Stanford Institute for Economic Policy Research (.pdf).

Previous Reform Thursday graphics can be seen here:

-Week One.
-Week Two.
-Week Three.
-Week Three, bonus.
-Week Four.
-Week Five.
-Week Six.
-Week Six, bonus.
-Week Seven.
-Week Seven, bonus.
-Week Eight.
-Week Nine.
-Week Ten.
-Week Eleven.
-Week Twelve.
-Week Thirteen.
-Week Fourteen.
-Week Fifteen.

Tune into WILLisms.com each Thursday for more important graphical data supporting Social Security reform.

Posted by Will Franklin · 19 May 2005 10:56 AM

Comments

Posted by: Zsa Zsa at May 19, 2005 01:16 PM

Posted by: Zsa Zsa at May 19, 2005 01:27 PM

Posted by: Walter at May 21, 2005 07:52 AM