Several people have mentioned the idea of taking SS early, to avoid possible negative changes in the benfit structure.
Unless you are very young, and hence this is really not a near-term concern, I think this is very unlikely. If SS were to become just another welfare program, it would be supported about as well as our other welfare programs are. For this important political reason, ending or gutting SS is less likely than other bad things, for example, another very important terrorist strike on US soil, or a breakaway panademic.
But my opinions don't have much weight. Here is what Prof. Munnell had to say in a public Q&A about a year ago while the privatization debate was still going strong.
Los Angeles, Calif.: As a 30-something, I can only see two possible outcomes for Social Security over the next 20 to 40 years:
a. It won't be around
b. My generation will be taxed to death so that the Baby Boomers can retire and then leave the program bankrupt for later generations
"B" is the likely answer since:
a. Our political and economic system rarely looks beyond next quarter
b. Our political system consists of entirely Baby Boomers, who have never shown themselves to look beyond their own generation's needs
Call me a cynic, but if I get a Social Security check when I retire, great, but I'm not counting on it.
Alicia H. Munnell: Social Scurity will be around and you will not be taxed to death. The Social Security actuaries say that raising the employer and employee tax each by one percentage would provide enough money to cover benefits for the next 75 years. One percentage point is not nothing, but hardly fits the "taxed to death" prediction. The alternative of course is benefit reductions. They would amount to about 20 percent -- holding harmless those 55 and over.
Dayton, Ohio: Ms. Munnell, the current discussions seem to be missing the fundamental question: What is the point of Social Security?
Is it supposed to be a retirement program? Or is it, fundamentally, a welfare program to protect those of the poor who happen to be old.
Rather than tinkering with percentages here and there, I wish we as a nation could have a real, meaningful decision about what we want it to BE, then decided how it should work.
Alicia H. Munnell: Social Security is a social insurance program -- not a welfare progrtam. Its strength rests with the fact that everyone contributes and everyone benefits. Because of its broad-based support and participation, Congress does not make capricious changes to the program and benefits involve no stigma.
There is more at
http://www.washingtonpost.com/wp-dyn/articles/A28634-2005Jan22.html
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