Saving

Senior Fellow Eugene Steuerle describes the many related issues that Congress will have to address if it decides to develop legislation to try to encourage the expansion of private pension assets along the lines of a government match.

Senior Fellow Eugene Steuerle examines the 1999 Clinton Administration proposal to create "USA" savings accounts. He concludes that the proposal for a match is one way to try to encourage greater saving, especially among the middle class, but that to be effective, a much more delicate crafting of legislation that simultaneously tries to address the excessive promises of social security along with the inadequacies of the existing private pension system would be required.

Senior Fellow Eugene Steuerle considers the math behind President Clinton's proposal to spend 62 percent of the surplus on Social Security, with another share to be allocated to Medicare, and that the remaining share be spent on other items, including a subsidy for new private pension accounts.

This study sheds light on the impact on workers of a higher normal retirement age, using data from the 1990 panel of the Survey of Income and Program Participation (SIPP) and the 1994 wave of the Health and Retirement Study.

Senior Fellow Eugene Steuerle lays out the complexity of the variety of pension plans offered by policymakers.

The debate over Social Security reform is awash with numbers on changes in tax rates, benefit reductions, and saving patterns required to bring the system into balance for the long run. In this article, Senior Fellow Eugene Steuerle skips around the more elaborate calculations and presents the financing dilemma in a simpler, more understandable, form.

Because Social Security spends tax collections almost immediately, rather than putting them aside to fund future retirement costs, it is believed by many to reduce net national saving at a time when other private and public saving are considered too low. This low savings rate coincides with a matured private pension system that does not provide much in the way of benefits for about half the population. These considerations have led many, including Senior Fellow Eugene Steuerle, to consider whether government ought to mandate that deposits be made to private saving accounts.

Senior Fellow Eugene Steuerle explains how raising the rate of contribution to private accounts by a significant amount, without a substantial increase in mandates or taxes might help clarify the Social Security privatization debate.

Senior Fellow Eugene Steuerle comments on Social Security privatization options, noting that none say much of anything about the current private pension system, its advantages and limitations, nor about the ways that new, mandated, private accounts would be integrated with private accounts already existing. If proposals for privatization of social security move to a more mature second stage, then reform of the private retirement system should be considered at the same time -- Steuerle suggests one such option.