Happy New Year and Happy Birthdays. This is the year that the first of the Baby Boomers start getting what theyre entitled to at the rate of 10,000 people a day for the next 19 years. Seventy nine million people, those born between 1946 and 1965, will turn 65, and will be ready to claim their share of Medicare and Social Security.
The Medicare impact will be the greater of the two, since a lot of people werent able to wait for their Social Security checks, and had to apply for benefits when they turned 62. Drawing Social Security Retirement Benefits before full retirement age carries a penalty, a reduction of as much as 25% of the benefit that would be available at full retirement age (currently thats 66, but in a few years it will start creeping up again), but for a lot of people, the chance to get any cash income is more important than what might have been. For the long term unemployed, the 99ers who have gone two years without finding a job, hitting age 62 is a bail-out.
The importance of Social Security cant be overstated. According to the AARP, 23% of people over the age of 65 live in families that count Social Security as 90% or more of their income. Another 27% count Social Security as at least 50% of their income. The average Social Security benefit is about $264/week. The good news is that Social Security has kept millions of older people out of poverty the bad news is that the good news is based on the official poverty guidelines, which, in 2009, came to $10,830 per year for a single person, and $14,750 for a couple.
The numbers and projections only get worse. The statistics on retirement savings for the boomers are depressing. Most havent saved enough, and/or lost money as the economy declined. The few who still have defined benefit plans, usually government employees, are discovering that past politicians didnt put aside enough money to cover their obligations, and current politicians (the poster child here is Chris Christie, governor of New Jersey) is happily attacking the victims and demanding give-backs. And a lot of people are more sympathetic to the politicos who spent the money that was due the public employees than are sympathetic to police, firefighters and teachers who trusted their elected officials. Former Sen. Alan Simpson (R-Wyo.), co-chair of President Obamas deficit reduction commission, has called the elderly, who are concerned about protecting Social Security and Medicare, greedy geezers.
While the economy seems to be growing, and the recession is over, based on the technical definition, a growth rate of 2.5% is barely adequate to keep up with a growing population. What we need, and should have had, is more economic stimulation, more infrastructure job creation. While the Republicans were technically right in saying that the tax cuts do provide economic stimulus (although they campaigned against stimulus, and although the tax cuts were in effect even as the economy went into the tank) the way to get things moving is by getting money into the hands of people who will spend it as soon as possible, to keep the money moving like the kids game of keeping a balloon in the air. Social Security does that, and if its not the perfect stimulus package, its as good as we can hope for these days.
We may have foolishly elected a bunch of people who dont believe in the importance of social programs, but if we can just hang on, we have lots of converts coming, at the rate of 10,000 people every day.
Sam Uretsky is a writer and pharmacist living on Long Island, New York. Email email@example.com.
From The Progressive Populist, February 1, 2011
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