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It’s Inequality, Stupid. Why Income Inequality, the Longevity Gap and Social Security are All Connected

One of the favored political tropes repeated often by the billion-dollar anti-Social Security lobby and its supporters in Congress as a justification to cut Social Security is:  “Americans are living longer so they should just work longer.”  That’s usually followed up with a personal anecdote like “Everyone I know plans to keep working into their 70’s.”  Maybe that’s true for hedge-fund billionaires like Pete Peterson and politicians like Alan Simpson.  Rich, white men live longer, healthier lives and no doubt it’s easier to consider working until 70 if the boardroom or committee room is where you spend your work day.

However, for the rest of America the “you can work until your 70” claim is built on the lie that “Americans are living longer.”  Multiple studies have shown the opposite to be true.  All Americans are definitely not living long. Yet another report from the National Academy of Science this week reports:  

“Men at the top of the economic ladder saw an eight-year increase in life expectancy, while men at the bottom saw virtually no change.” 

No change. 

According to researchers, an increasing gap in life expectancy between the wealthy and the working class has come – and may even be caused by -- the growing inequality of wealth and income in America. If you can afford the best healthcare, work in high income careers requiring less physical labor and have a higher education allowing you to navigate America’s complicated healthcare system, is it any surprise you might live longer?  As more income goes to the richest Americans, our middle-class is shrinking leaving even more people vulnerable.

Teresa Ghilarducci is a labor economist who directs the Retirement Equity lab at The New School. She sums it up this way:

“The idea that everyone should work longer since everyone is living longer is one used to justify policy proposals such as cutting Social Security benefits. But that idea is a misleading oversimplification.

The Retirement Equity Lab at The New School (a project I direct) has pointed out that the growing class and racial gaps have dire implications for retirement policies. A cut to Social Security benefits—which raising the retirement age, an oft-suggested proposal, essentially is—would induce people without means to work in old age. This would produce an unseemly form of inequality: The people who live the longest will be able to retire, and the people who have to work longer will be the same people who are losing at longevity. The poorer will work and the richer will play in old age, a class divide we’ve already seen in the 19th and early 20th centuries. If post-work benefits are not shored up, this disparity will only get worse.”

Budget Squabbling and Its Potential Impact on Social Security & Medicare

The Office of Management and Budget is monitoring congressional actions and preparing to instruct agencies when they should begin implementing shutdown plans as funding our nation’s programs languishes amid the GOP-led Congress’ squabbling over defunding Planned Parenthood. One week prior to a potential lapse in appropriations, the OMB is expected to hold a meeting with senior agency officials to begin planning for the shutdown.

With the clock ticking, Congress is scrambling to not only avoid a government shutdown and default but also pass an extension for transportation funding and tax breaks. Will the sequester continue or can Congress find a better way to manage our nation’s finances?  This political gamesmanship and inability to get anything done impacts far more than one federal program.  Seniors programs like Social Security and Medicare are also in the cross-hairs.

“America’s seniors have become especially weary of these Congressional dramas as they have learned, the hard way, that Social Security and Medicare have become the favored target for budget cuts or “pay-fors” for a host of Congressional programs that have nothing to do with providing the earned benefits seniors depend on.  From highways to trade and beyond, Congress continues to try and use seniors’ programs as a national ATM. The next few weeks promises more of the same”... Max Richtman, NCPSSM President/CEO

The National Committee to Preserve Social Security and Medicare has prepared a detailed Fall Legislative Update mapping the current legislative minefield for programs which touch the lives of virtually every American family.

We’ve identified the numerous legislative hurdles still ahead, the possible threats to Social Security, Medicare and Medicaid and our positions on each potential pay-for or budget cut.  You can see NCPSSM’s Fall Legislative Update here. 

How Important is Social Security to America's Hispanics?

It’s Hispanic Heritage Month and a good time to highlight just how important Social Security is to Americans of all ages, but especially Hispanics.  Our National Committee Policy experts explain why

  • Almost three-fourths (74%) of Hispanic beneficiaries rely on Social Security for at least half their income compared to almost two-thirds (64%) of all beneficiaries.
  • Approximately 53% of Hispanic beneficiaries rely on Social Security for 90% or more of their income.
  • Approximately 46% of Hispanic beneficiaries rely on Social Security for all of their income.

Minorities rely more heavily on Social Security due to a lack of other income in retirement.  Few elderly minorities receive income from pensions and assets.  The greatest disparity is in the receipt of income from assets.

  • In 2012, 25% of Hispanics received income from private assets, compared with more than 55% of whites
  • In 2012, 13% of Hispanics 65 years old and over reported receiving income from private pensions or annuities, compared to 28% of whites 65 years old and older

Elderly Hispanics are more dependent on Social Security than others because they are more likely to be in poverty than non-Hispanic elderly.

The GOP Debate...Slim Pickin’s If You Care About Social Security or Medicare or Virtually Any Other Issue Impacting Average Families

Now that America’s Presidential Debates are designed as entertainment television (as described here by CNN Moderator Jake Tapper) and not an actual debate of the issues voters need to hear about before choosing our next’s probably no surprise that Social Security & Medicare just aren’t considered sexy enough for any serious attention. 

In response to the only question asked last night about the nation’s most successful government programs, Donald Trump told the audience he’ll give up his benefits because he doesn’t need them (Ben Carson made the same suggestion earlier in the week).  So, you have to wonder -- is asking rich people to voluntarily give up their Social Security and Medicare now considered a serious GOP policy plan? Maybe every American millionaire will be asked to email 10 of their country club friends to pledge to give up their benefits, too?  No one is forced to apply for their Social Security now, so how is this even vaguely a solution? 

Meanwhile, since Governor Chris Christie staked his campaign on the idea of being tough on “entitlements” he continued to push his plan to slash benefits by ignoring actuarial reports from every legitimate government entity including the Congressional Budget Office and the Social Security actuary. Christie claimed last night that Social Security will be insolvent in just “7 to 8 years.”

The truth is the Social Security Trust fund will be depleted in two decades and only pay 79% at that point, if Congress does absolutely nothing.  But that’s not the same as Social Security is “broke” and Social Security is “insolvent.”  At the bare minimum, a President of the United States needs to understand the difference. 

Finally, while this didn’t happen in last night’s debate, Carly Fiorina recently offered a truly unique approach to her plans for Social Security and Medicare as’s a secret until I’m in the White House. 

"I am not prepared to go to the American people and talk to them about how we're going to reform Social Security and Medicare,’ Fiorina told CNBC's John Harwood in an interview published Wednesday, ‘until I can demonstrate to them that the government can execute with excellence, perform its responsibilities with excellence, serve the people who pay for it with excellence.’

Harwood was impressed. ‘That is a dodge worthy of a very good politician,’ he told the former Hewlett-Packard CEO. 

Fiorina denied that she had just dodged. ‘I am deadly serious,’ she said.” 

No doubt she’s deadly serious about not addressing the issue now or talking about her already expressed plans to cut Social Security offered during the California Senate campaign in 2010:

"I'm prepared to look at any and all ideas without stating at this point which I would favor and which I would not. We have to have a comprehensive look at entitlement reform, including Social Security reform."  Carly Fiorina, 2010

“... I believe that to deal with entitlement reform, which we must deal with, we ought to put every possible solution up on the table...”  Carly Fiorina, Fox News 2010

So basically, once President Fiorina is confident she’s an excellent President then she’ll tell you about her plans to cut Social Security and Medicare benefits. 

But only then...

In Case You Missed It -- FDR's Visit to Capitol Hill

We know that many of our members and supporters don't live close enough to Washington, D.C. to join us for the National Committee's Social Security celebration with President Roosevelt.  So, we've put together this quick video highlighting the 80th celebration.  {All you Benny Goodman fans will especially enjoy it!}


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