Washington, D.C. — Many in Washington have pushed to cut Social Security, but a new report released today from the New America Foundation's Economic Growth Program advises the opposite strategy. The report argues that to truly deal with the nation's retirement security crisis and guarantee secure retirement for working Americans, the U.S. must expand Social Security and minimize the importance of private, tax-favored programs.
The report, "Expanded Social Security: A Plan to Increase Retirement Security for All Americans," explains why an expansion of Social Security, rather than a contraction, should be the backbone of a more effective retirement policy. The report also proposes a model for how an expansion of Social Security can work more equitably and how it can be paid for.
The report is written by Michael Lind, policy director of New America's Economic Growth Program, Steven Hill, researcher, author and publisher of Steven-Hill.com, Robert Hiltonsmith, policy analyst at Demos, and Joshua Freedman, policy analyst at New America's Economic Growth Program. It is part of New America's Next Social Contract Initiative and its paper series, "Renewing the American Social Contract."
The authors argue that the only leg of the retirement security "stool" that has remained trustworthy over the years has been the public Social Security system. They propose reforming Social Security by expanding it into a two part, or "double decker," public system that would increase benefits.
The two-part plan includes:
• Social Security A: an upgraded version of today's Social Security program, the earnings-based public defined benefit program for all retired workers; and
• Social Security B: a flat basic income for all elderly Americans that can be funded out of general revenues.
Under this proposal, the report argues that expanded Social Security would better ensure an adequate standard of living for all retirees while preserving the basic structure, success, and popularity of today's program. At the same time, by moving away from the inefficiencies inherent in the current private elements of retirement, the authors calculate that the new program could potentially cost the same or less while increasing benefits for retirees.
"Instead of compounding failure by expanding private benefits, a category that includes rapidly-disappearing defined benefit pensions, employer-provided 401(k)s and individual retirement accounts (IRAs), we should substantially expand the successful, purely public Social Security program," the report states.
To read the full report, please click here.
To interview one of the authors, please contact Clara Hogan.