Suchergebnisse

Discusses basic issues relevant to the US Social Security system and Medicare. This pay-as-you-go (PAYGO) system is financed by taxes on the earnings of workers & links what a person gets back to their growth in earnings. The rates of return from Social Security are described to point out that the end payout is far less than the return on private investments. Attention is called to how PAYGO Social Security affects both private saving for retirement & the labor supply. It is maintained that earlier retirees fared far better under Social Security than later retirees have. An examination of looming financial problems facing the program suggests that future benefits will not be possible without a significant increase in taxes. Arguments in favor of continuing Social Security are considered, along with proposals for reform, suggested alternative systems, features that make Social Security politically appealing, & similarities between Social Security & Ponzi schemes. It is concluded that the US PAYGO Social Security system is actually a bad deal for workers. Tables, References. J. Lindroth