Social Security Isn’t Going Broke. Older Americans Are.
By Eric Levitz
America is getting older. The elderly are living longer. Private pensions are disappearing, working-class wage growth has long been middling, the cost of health care is soaring (and that of breakthrough treatments for ailments common among seniors, skyrocketing), our nation’s birth rate is plummeting — and the problem that these trends collectively create is genuinely vexing.
At present, the median household led by an American between the ages of 55 and 64 has about $12,000 in its retirement accounts. Only a small fraction of the next wave of retirees will collect public or private pensions; these days, most small businesses don’t even offer 401(k)s. Meanwhile, an American who survives until 60 can expect to live for another 23 years (five years longer than in 1970), and the median cost of a private room in an American nursing home is now more than $92,000 a year.
As a result of all this, 18 million baby-boomers are poised to live out their golden years on the brink of bankruptcy. And that is assuming that entitlement benefits are maintained at their current levels. According to government projections, Social Security will take in less revenue next year than it will pay out for the first time since 1982. Absent changes to the program’s funding structure, the Social Security trust fund…
