The first baby boomer applied for Social Security benefits this week, launching a retirement wave that economists warn could overwhelm the system. Kathleen Casey-Kirschling turns 62 one second after midnight on Jan. 1, making her the first of 80 million Americans born between 1946 and 1964 to reach the system’s age for early retirement. At the end of World War II, there were 44 workers paying for each retiree; now there are three, and soon there will be more retirees than workers. “If this were a movie,” said David John, an economist from the Heritage Foundation, said, “this is when the scary music would start.”
What the commentators said
For decades, pundits have been warning of the coming “entitlement crunch,” said The San Diego Union-Tribune in an editorial. And now it’s here. Starting in January, the first of 78 million boomers will turn 62 and become eligible for Social Security, and the system will collapse unless both Republicans and Democrats make compromises to fix it. “Let’s get to work.”
“The fairest way to fix the problem,” said Lita Epstein on BloggingStocks.com, “would be a combination of tax increases and cuts in promised benefits.” But there’s no way Congress will find a solution unless both sides “stop using scare tactics and start having a serious discussion about the options to fix it.”
The debate has already started on the campaign trail, said The Washington Post in an editorial (free registration). Republican Mitt Romney has proposed exempting households making less than $200,000 from taxes on savings, and Democrat Hillary Clinton has a bolder idea—giving “generous government matching payments” to low- and middle-income people who contribute to private retirement accounts.