Question

Analyze the aging of the U.S. population and the financing of Social Security. What do you think should be done for the long-term benefit of the nation, senior citizens, and taxpayers to place social security on a sound financial footing going into the future.

Answer 1

Because of demographic changes, the U.S. Social Security system will face financial challenges in future. Declining fertility rates and increasing life expectancies are causing the U.S. population to age. Today the old population in US is approx 10 percent and working people population is more. After 50 years the old people population will be increased and the working people population will be decreased.One policy option that could help keep the Social Security system solvent is to reduce retirement benefits, either by raising the normal retirement age or through life expectancy indexing, to reflect the fact that people are living longer. However, these reductions in benefits have the potential to harm economically vulnerable retirees.

The aging of America has created a situation in which relatively fewer workers will be asked to support a growing retired population. The historical and projected ratios of workers to beneficiaries, measured as the number of workers in Social Security–covered employment divided by the number of Social Security beneficiaries

1. Social Security taxes are too high.

2. Social Security is not a good deal for workers.

3.Privatization is the way to guarantee a safe and secure retirement.

4.Thousands of Americans already have private retirement systems.

5.Privatization could jump-start the economy.