Academic journal article Washington and Lee Law Review

Social Security: Can the Promise Be Kept? an Introduction

Academic journal article Washington and Lee Law Review

Social Security: Can the Promise Be Kept? an Introduction

Article excerpt

Social Security is arguably the most successful social program ever adopted in the United States. Providing income protection for workers and their families in retirement, disability, and death, Social Security has significantly reduced financial insecurity, especially the elderly's poverty rate.1 Nonetheless, the Social Security program itself now faces financial insecurity, largely because of various demographic factors. The Frances Lewis Law Center and Washington and Lee University, in a long tradition of promoting an opportunity for positive dialogue about a subject of national importance, devoted its Spring 2001 symposium to the question of Social Security reform, its necessity, and how it might best be effected. Social Security: Can the Promise Be Kept? considers the demographic factors prompting our concern with Social Security's long-term viability and, equally importantly, the implications of any reform for twenty-first-century America's economic and legal structure. The symposium offered ten leading individuals, including economists, government policymakers, practitioners, and members of the legal academy, the opportunity to inform the debate concerning Social Security reform with a wider perspective. By examining in context the program that is available to all working Americans, cognizant of other existing programs, especially employer-provided, tax-qualified plans, the manifold implications of Social Security reform can be better addressed. The complexity of any Social Security reform should not serve as an impediment to necessary reform. Rather, any reform adopted should be better able to meet Social Security's needs because it would recognize related systems and other national priorities.

The baby boom generation's relationship to the economy, as C. Eugene Steuerle reminded us, has been likened to a pig that was swallowed by a python and has been moving inexorably through the system.2 The baby boom generation has moved through the economy and is now close to retirement, thus explaining some level of our attention to the baby boom generation's retirement

security. The desirability of increasing our national savings rate, always an issue of great concern for economists and policymakers, also explains some of our concerns as well as some of the proposed solutions.3 In addressing the immediate problem faced by the Social Security program nationally, we also have engaged in a re-examination, often without realizing it, of the principal tenets and competing goals of social insurance - social adequacy and individual equity. Somewhat surprisingly, individual accounts, which are comprised of the diversion of some portion of current workers' Social Security taxes to private accounts, have become the sine qua non of its proponents or the cum qua non of its opponents in the reform debate.4 This resulting narrow focus, while appearing to address both savings rates and individual equity concerns, turns out not to be entirely helpful. Whatever reform we adopt must answer not only the demographic challenges and capital formation needs of our society; it must do it in a world where the current system of employer-provided, taxqualified pensions is shaped by and predicated on the current Social Security system.5 The impact of reform for the existing employer-based system, in which only half of all employers currently participate,6 needs consideration. If participating employers are now responding to economic trends by shifting to employees the increased risk and responsibility for providing their own adequate retirement and health care, we must examine our fundamental commitment to the element of social insurance inherent in the current Social Security program lest we institute changes that could constitute a rejection of one of the program's basic goals - social adequacy. …

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