‘Social Security—the nation’s largest, costliest, and most successful domestic program has reached a critical juncture in its development. As its creators anticipated, nearly every wage earner now pays taxes into the system. In principle, all citizens may be eligible for "entitlements" at some point in their lives. Yet . . . senior citizens worry that their benefits will be cut; younger Americans are skeptical—if not cynical—about their own benefits upon retirement.’— W. Andrew AchenbaumThis summation of the state of Social Security was written more than a decade ago. Looking back, it seems as though the Social Security system frequently reaches a state of crisis in which predictions of its end arise. Since it was enacted in 1935, Social Security has been amended often, most recently in 1983, when Congress imposed a tax on the benefits of high-income retirees, raised the retirement age, and revised the tax-rate schedule.Today, the future of Social Security is in the news again. On the 27th of January last year, President Clinton in his State of the Union address recommended that the projected federal budget surplus be used to save Social Security. He proposed to reserve 100 percent of the surplus until all necessary measures to strengthen the Social Security for the twenty first century were taken.The reason Social Security is of such concern is that the extremely large group of citizens born in the post-World War II period—the much-discussed baby-boom generation—is heading toward retirement. The generation that will take its place in the workforce is far smaller in proportion to the number of retirees, raising fears about the sustainability of Social Security. In the past, proposed solutions to the various problems facing Social Security aroused great debate. Each time, however, the arguments were stilled, repairs were made, and the system continued to fulfill its mandate. That un...
