How Raising The Retirement Age Screws the Poor - MoJo

[WillyT]

How Raising The Retirement Age Screws the Poor
— By Kevin Drum | MotherJones
Fri May. 13, 2011 3:00 AM PDT

<snip>

I've never been a fan of raising the Social Security retirement age. It's a blunt instrument mainly favored by journalists and policymakers who don't plan to retire at age 65 anyway and figure that asking people to work a little bit longer than they used to is no big deal. But people who don't have white collar jobs quite plainly don't feel the same way about it, as the skyrocketing number of people who retire early at age 62 demonstrates. We've already raised the full retirement age to 67 (this was part of the 1983 Social Security deal put in place by the Greenspan Commission), and I think there are plenty of better ways of bringing Social Security into balance than by raising it yet again.

Aaron Carroll demonstrates this dramatically with the chart below, taken from a paper by Hilary Waldren. As you can see, life expectancy in the top half of the income distribution has indeed risen dramatically over the past few decades. But in the bottom half of the income distribution, it's barely risen at all.



I want to make it crystal clear what this means, using further data from Waldren's paper combined with the increase in increase in retirement age that's already scheduled to take effect. This is for workers in the bottom half of the income distribution:

*If you retired in 1977 at age 65, your life expectancy was 14.8 years.

*If you retired in 2006 at age 65 years and 8 months, your life expectancy was 15.4 years.

*Using a simple linear extrapolation, if you retire in 2025 at age 67, your life expectancy will be 14.9 years.

So that's it. Over the course of half a century, thanks to the increase in retirement age already scheduled by law1, the poor and the working class will have seen the length of their retirements increase by a grand total of one month. Yippee!

Keep this firmly in mind whenever someone talks about how life expectancies have skyrocketed and we can't afford long, leisurely retirements anymore. If you're fairly well off and work at a white collar job, there's something to this. If you're not, it's bunk.

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More: http://motherjones.com/kevin-drum/2011/05/raise-retirement-age-screw-poor

:kick:

[L0oniX]

1. Old people are worthless to corporate psychopaths.

[RKP5637]

2. That is the bottom line, isn't it. And to that I would add the sick. These

corporate psychopaths don't give a damn about anyone. It's a sickness IMO brought on by unregulated capitalism and greed, and on top of that they are compulsive. No amount of profit will ever be enough. It is really sick, sick, sick.

[L0oniX]

3. Watch "The Corporation" on Netfix and it becomes clear that corporations are psychopaths.

[RKP5637]

4. Yep, it really really did make it clear corps are psychopaths. Excellent recommendation. I watched

it a few weeks back on Netflix. It should be aired on cable TV often. I wish MSNBC would show movies like "The Corporation" instead of Lockup all the time.

[Curmudgeoness]

5. The chart is crystal clear. And there is so much more to this issue.

Like asking a waitress or pipefitter or plumber to work to 67 is a sin, and increasing that goes beyond evil. It is getting harder for me to keep up with my job, and I work in an office. But my mind is not working as fast as it used to, and bending to do the filing isn't as easy as it was. I don't want to think of how hard my job will be for me by retirement age, and I have a cake job compared to so many working people. This just sucks and it has to be stopped.

[JDPriestly]

6. This is the true story.

I'd like to see a chart by race and ethnicity also. I think that might be quite revealing.

[The Wizard]

7. Keeping workers on the job

for more years creates increased unemployment and the consequent lower wages because of pressure on the job market. It widens the gap between rich and poor while at the same time temporarily increasing the bottom line corporate profits.
The long term effect is fewer people with disposable income and a major economic downturn.
It's a formula for pain and failure.