Word: younger
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Dates: during 1990-1999
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...their actual contributions. But if the change is to take place, it would be better to have it before the immense claims of retiring baby boomers send the system into shock-and create a huge bloc of pensioners fiercely invested in the status quo. Also before a resentful younger generation, faced with the prospect of giant tax hikes, starts practicing reform with a sledgehammer...
That road to salvation, however, has probably hit a dead end. Social Security taxes, once negligible, have become a severe burden, and one of the most regressive taxes that government collects. An estimated two-thirds of all workers, especially younger ones and the working poor, pay more Social Security tax than federal income tax. In 1991 a family of four earning half the median U.S. income--$43,000 that year-paid 4.8% of its meager earnings in income tax, but 12.4% to Social Security. Those figures, it is true, include the half share of Social Security taxes supposedly paid...
...PRIVATE: This is a variation on the Heritage Foundation idea, but one that would not allow younger and more affluent workers to abandon the system altogether. The basic concept: require workers to place part but not all of their Social Security contribution into a system of mandatory iras. The funds' managers, selected by the government for integrity and competence, would invest the money in corporate stocks and bonds. In most versions, workers would get to choose funds that pursued very conservative or more adventuresome investment strategies...
...that it would still require some mandatory payment into government coffers as well, which would be used to provide a safety net for indigent retirees and to guarantee benefits to current retirees and those soon to come who have not spent a lifetime accumulating a private account. But younger workers would be on notice that when they reach retirement, they will have to depend largely on what they have built up in their IRAs...
...Social Security really such an untouchable issue? As younger workers become a larger proportion of the electorate, they can be expected to assert their own interest in the matter, which is not the status quo. And it's even possible to hear at least a peep of compromise from the American Association of Retired Persons, the huge lobby that has treated most prior talk about changing Social Security the way the National Rifle Association of America reacts to new gun-control bills. "It's probably true that in the future we're going to have to lower benefits...