Social security was never intended to be a "retirement program" or "disability insurance." Disability insurance is provided by the private sector, as are retirement programs. SS was created to insure people against living past their life expectancy/nestegg. Back when the New Deal was established, the average life expenctancy was 57/58 for men and women respectively. Now, according to actuarial tables, the life expectancy is 77/78; that includes premature deaths. Statistically speaking, if you reach age 65 you are VERY likely to live another 20 to 30 years.
The golden age of 65 became the official draw age and has not changed, although life expectancies have increased dramatically. So for a program to be scheduled to draw out for an increasing period of time over the years, and remain solvent, the amount of time people pay in should be increasing too (thats called math). The problem is that this has not been the case; life expectancies continue to rise, yet the draw age remains the same. Now combined with the fact that baby-boomers are hitting retirement, we have hit a huge problem.
Lets not forget that the SS trust fund is filled with IOUs, not cash. Thats right, it is filled with bonds with our US goverment's name on it. The government has been drawing out more money for other entitlements and taking the money from the fund. So thats problem number three.
The government has tried to whole "increase taxes" thing to try to supplement and save the trust fund for going belly-up. Too bad the politicians are dim-witted when it comes to money, finance, and economics.
Bottom line, this program is doomed to fail. The republicans have right when they say we need to have a grown-up conversation regarding this issue; people just do not want to grow up and face the issue. This is the same problem some people have when it comes to examining their own finances: they know what needs to be done, but no one wants to do it.
There are two solutions: number one is to allow the program to be completely voluntary. Only people funding it can draw benefits, and at a limited amount.
The second solution is to extend the draw age to match actuarial life expectancy. This would not be possible immediately, however a gradual change could be done. Paul Ryan of the budget committee has a "road map" that addresses the SS issues. His ideas are great and have some benefit, however there are sacrifices that need to be made. It is just too bad to people in this country don't want to grow up and make the sacrifices necessary to fix a big problem.
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