ARBOR WEALTH: Unions, pensions & Social Security

Published: Thursday, February 20, 2014 at 03:50 PM.

“And keep your retirement… And your so-called social security. Big city turn me loose and set me free.” — “Big City” by Merle Haggard

  The first Social Security account was established in 1936 for 23-year-old John David Sweeney, Jr. of New Rochelle, N.Y., who never received a dime in benefits.  Unfortunately, Mr. Sweeney died of a heart attack at age 61.

The average U.S. life expectancy in 1935 was 62. Today it’s 79. Unions, which once fought for not only livable wages but solid retirement packages, have declined in numbers and bargaining power.

Private pensions, a ubiquitous part of our historical economic landscape, are now virtually an anachronism. And Social Security was originally designed only to supplement such pensions as financial protection for retirees in old age. With 10,000 Baby Boomers retiring daily, it is easy to understand the factors that are stressing the system. 

According to Liz Pullium Weston in “The Tax Cut That Taxpayers Need Most,” ‘Two thirds of U.S. seniors rely on Social Security for more than half their income and four out of ten say it comprises more than 80 percent.’ ” 

So what is the future of Social Security in the U.S? 

It’s probably better than we think. First, we Boomers comprise a tremendous voting bloc. And very few among us will support cutbacks in Social Security benefits. So the oft-espoused notion that Social Security benefits will not be there for our generation is probably hyperbole, in spite of our national budget woes.

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