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Higher Retirement Age Among Social Security Options
Ledger-Enquirer.com
June 16, 2005
Grassley plan would be phased in over two decades
No decisions have been made yet, and it could be fall before the politically volatile Social Security issue reaches the floor of either the House or Senate, if then.
At the same time, an increase in the retirement age is one of the suggestions that Sen. Charles Grassley, chairman of the Senate Finance Committee, outlined last week for fellow Republicans on the panel, according to several officials.
Officials said Grassley's suggestion for raising the retirement age would be phased in, possibly over two decades or more, depending on future demographic trends.
The Iowa Republican has also suggested steps to hold down benefits for future upper-income retirees. The officials who described his presentation did so on condition of anonymity, saying the discussions were confidential.
Under current law, the age for retiring with full Social Security benefits is 65 years and six months. It is rising gradually until it reaches 67 for individuals born in 1960 or later.
The GOP lawmakers on the committee are scheduled to meet again today to continue their work, hoping to agree on a plan that can unify Republicans and allow them to advance one of President Bush's key second-term priorities.
The issue has become intensely contentious in Congress, with public polls indicating tepid support for Bush's call to allow younger workers to create voluntary personal accounts funded out of their Social Security payroll taxes. Democrats accuse the White House of seeking to privatize the depression-era program, while supporters of the accounts argue they are needed to modernize it.
"The easy path is to do nothing. That's the easy political path," Bush said Tuesday in State College, Pa., where he appeared before a young audience drawn from rural families.
"The tough path is to come together and get something done. But let me tell you something. By doing nothing, you're about to hear that we will have done a disservice to a younger group of Americans coming up," he told a convention of the Pennsylvania FFA, formerly known as the Future Farmers of America.
For their part, Democrats criticized Bush anew, saying his proposal would privatize Social Security while cutting benefits.
"Rural Americans tend to be older and more likely to depend on Social Security," Reps. Stephanie Herseth, D-S.D., and Bob Etheridge, D-N.C., said in a joint statement. They head the Democratic House Rural Working Group.
The president has called for a bill to create permanent solvency for the program, and he also wants the bill to give younger workers the option of establishing a personal retirement account financed from a portion of their payroll taxes.
Under current predictions, Social Security will begin to pay out more in benefits than it receives in tax receipts in 2017, and the trust funds will be depleted in 2041. At that point, benefits would be cut to adjust for the reduction in available funds.
Along with curbs in benefits or increases in taxes, raising the retirement age is one of three general approaches that lawmakers can consider as they try to improve the solvency of Social Security.
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