Social Security in the 21st Century :: essays research papers

The 2004 Report of the Social Security Trustees is in; but the jury is still out à ½arguing the findings of the report. Agree or not, the masses have a good idea of à ½the final ruling and they all agree that the current state of the social security à ½system has suffered, for a very long time, from an ongoing deficit problem that à ½will continue to grow unless immediate steps are taken to address the problem. à ½People, on both sides of the fence, argue in support or against the president’s à ½proposed plan to save the Social Security system. Yet, they all concede and à ½acknowledge that in reality a problem does exist; and unless calculated à ½measures are taken, this problem cannot be controlled and will snow ball the à ½Social Security System into bankruptcy.à ½ The Social Security system was designed in 1935 for a world that is very à ½different from today. In 1935, most women did not work outside the home. Today, à ½about 60% of women work outside the home. In 1935, the average American did à ½not live long enough to collect retirement benefits. Today, life expectancy is 77 à ½years. (2004 Report of the Social Security Trustees, p. 81) Benefits are expected à ½to rise dramatically over the next few decades. Because benefits are tied to wage à ½growth rather than inflation, benefits are growing faster than the rest of the à ½economy. This benefit formula was established in 1977. As a result, the current à ½Ãƒ ½20-year old contributor is promised benefits, which are 40% higher than what will à ½be paid to seniors who retire this year. However, the current system does not à ½have the money to pay these promised benefits. Furthermore, the retirement of à ½the Baby Boomers will accelerate the problem. In just 2 years, the first of th e à ½Baby Boom generation will begin to retire, putting added strain on a system that à ½was not designed to meet the needs of the 21 century. By 2031, there will be à ½almost twice as many older Americans as today, a drastic increase from 37 à ½million today to 71 million. à ½ Currently, there are fewer workers to support our retirees. When Social à ½Security was first created, there were 40 workers supporting every one retiree. At à ½the same time, most workers did not live long enough to collect retirement à ½benefits from the system. Since then, the demographics of the society have à ½changed dramatically where people are living longer and having fewer children.