Teresa Ghilarducci on Social Security Fixes to Protect the Poorest
The New School retirement specialist says seniors are running scared and vulnerable to financial mistakes and coronavirus scams.
As Congress and the president debate Covid-19 cash and bailouts for companies and workers on the front lines, elders are sidelined. I’m stunned the only proposal widely floated on Social Security was to cut taxes for employers. That’s a mistake. Social Security and pensions are a significant source of aggregate demand, especially in some regions hit hard by Covid-19. Social Security benefits are 0.003% of gross domestic product in Utah and more than 10 times that in older and poorer states like Tennessee and Maine.
There is no guarantee that Social Security’s 64 million beneficiaries will receive a Trump stimulus check. U.S. elder poverty, at about 23%, is the highest among rich nations and will rise as older workers prematurely losing jobs—and prematurely entering retirement with crashing 401(k)s that could now be called 201(k)s—face a more challenging post-coronavirus future. So here is what policymakers need to do today.