Massive deficits might have long-term consequences for our economy? What'choo talkin' 'bout, Greenspan?
NEW YORK (CNN/Money) - Fed Chairman Alan Greenspan warned Congress Wednesday to take quick action to fix the nation's swollen budget deficit -- including cutting some future Social Security payments -- in order to avoid even bigger problems for the nation's economy down the road.
The central bank chairman also repeated his assertion that recent tax cuts should be made permanent and said cutting Social Security benefits and other spending was a better way to fix the deficit than tax increases.
While somewhat alarming, talk of cutting Social Security really shouldn't come as a shock to anyone who's been paying attention to that huge demographic bulge about to retire. My own retirement planning (once I was finally convinced to get off my ass and start saving) has always assumed that SSA wouldn't be around when I finally got around to retiring. In my mid-80s, apparently.
The fact that our current deficit is not a product of so-called "tax-and-spend" Democrat policies but is thanks to our allegedly conservative President is strangely satisfying. Or would be, if I wasn't worried about my job going to Bangalore. But that's apparently "a good thing" as well, so what can you do.
He proposed some solutions that would reduce future Social Security benefits to retirees, including raising the ages at which retirement benefits are paid and changing the inflation measure used to index the payments.
On a purely unrelated note:
CLINTON, Maryland (AP) -- William Coates, believed to be the oldest man in the United States, died Monday at age 114.
That would make Coates four years older than Greenspan's projected (in 2050) retirement age of 110.
Social Security was created as a source of social welfare. I never understood why those who don't need get to collect it. That'd be like those of us lucky enough to be employed also collecting unemployment benefits. I'm not saying it should be all or nothing, but I'd wager that paying social security benefits out on a sliding scale based on enonomic need would help the problem quite a bit.