What is the GOP’s plan to increase the retirement age to seventy?
The GOP is circulating a proposal to increase the retirement age for younger workers to seventy. What would this mean for Social Social Security?
Even if the majority they hold is small, the GOP is working to extract concessions from Democrats during negotiations over the debt ceiling. Republicans would like to see committed cuts to domestic social spending programs like Social Security and Medicare in exchange for their votes to increase or suspend the country’s debt limit.
One of the proposals circulating on Capitol Hill would increase the full retirement age (FRA) to receive one’s maximum Social Security benefit from sixty-seven to seventy.
What is the 'full retirement age'?
The full retirement age, in the United States, refers to the age at which one's maximum Social Security benefit can be claimed. Benefits can be claimed at sixty-two, but the greater number of years worked, increases their monthly benefit, which incentives many to remain in the labor force.
The change would only impact workers who will retire after 2040.
In 2000, Congress passed a bill that moved the FRA from sixty-five to sixty-seven over a twenty-year period. The current proposal would implement a continued increase of the FRA by three months per year for eighteen years until it reaches seventy.
The Republicans point to declining worker-retiree ratios and longer average lifespans as justification for this change.
And if action is not taken, the Social Security Adminstration (SSA) expects the tax revenue collected to fall short of what is needed to pay out all benefits. The SSA predicts that this situation could arise by 2035, at which point federal law requires an automatic benefit cut be enacted.
Truthout noted that this plan comes as average life expectancy in the US hits its lowest since 1996. In 2019, average life expectancy in the United States stood at 78.79, and in 2021 it fell to 76.1 years. Racial justice activists have also argued that the GOP’s plan neglects the fact that the life expectancy for Black people is seventy-one years, just one longer than what millions could be expected to work.
Living longer doesn’t mean aging stops
While life expectancy had been trending upward before the pandemic and will likely begin to rise in the coming years, there are other dangers of extending the number of years people spend in the labor force.
The fact that modern medicine could extend the average life span of younger workers does not mean that they stop aging.
Over time, people may lose muscle, hearing, vision, or agility; others may see their reflexes slow. These effects of aging can create risks for workers, partially those in physically demanding roles. In 2021, workers over forty-five made up forty-three percent of the labor force, yet this group made up more than fifty-six percent of workplace fatalities that year.
If claiming benefits requires workers to reach a certain age, employers must be mandated to adapt responsibilities to ensure older employees are safe and can age with dignity.
Raising the retirement age will could lower Social Security benefits
Raising the FRA is another way to cut government expenditure on the program. Increasing the number of years one has to work to see their maximum benefit usually means that the government will pay fewer of these higher benefit amounts. The workers who can afford to retire before seventy will continue to do so.
Effectively, as was identified by Matt Bruneig, raising the retirement age is just another way to cut benefits and shrink the size of the program.
The workers who can afford to retire before seventy will continue to do so, and those who can’t stay in the laborforce longer to earn what would have previously already been theirs.