Thought from another thread: unemployment and the retirement age

[Recursion]

How much do you think unemployment would go down if we lowered the retirement age for full SS benefits to, say, 58?

If we made it so that people who are 58 and older could reasonably retire,

A) would they? and
B) how many people would end up being hired if they did?

Politically, is there a way to sell lowering the retirement age as a jobs program?

[sinkingfeeling]

1. So what are you really suggesting? That all SS retirees receive the exact same benefit? You do

understand that the amount of one's benefit is determined by 'average earnings' of the 35 highest-income years? My employers and myself had paid the maximum to SS for like 35 years. Some may have worked for years at minimum wage or just above. To give the maximum benefit (that received at age 66 today) would require the US government (?) to add in both shares of the taxes for an additional 8 years per person. Are you willing to have the SS tax rate go up?

Now to answer your questions. A) No. I'm going on 63 and have no desire to stop working. B) You would probably see less people hired than retired, because companies are running on the 'cheap' today. While they would probably pay a 'newer' person less, they probably wouldn't hire two new folks for one retiree.

And as a jobs program, it's more expensive than setting up a true federal jobs program to hire the unemployed to rebuild our infrastructure.

[Recursion]

2. To answer your questions

You do understand that the amount of one's benefit is determined by 'average earnings' of the 35 highest-income years?

Yes, I do.

To give the maximum benefit (that received at age 66 today) would require the US government (?) to add in both shares of the taxes for an additional 8 years per person.

Pretty much

Are you willing to have the SS tax rate go up?

I'm very willing for the cap on FICA levies to disappear, and for unearned income to be included, even if it involves some raising of the maximum benefit. The argument that "it will then be a welfare program and be easier to cut" holds little water with me, since people seem quite eager to cut it already.

No. I'm going on 63 and have no desire to stop working.

Quit bogarting the job market, dude! (kidding)

You would probably see less people hired than retired, because companies are running on the 'cheap' today.

Yes. We're well aware that we will never be as well off as you guys are, because the profits that fund your 401(k)s are dependent on us getting screwed out our wages. Don't rub it in.

And as a jobs program, it's more expensive than setting up a true federal jobs program to hire the unemployed to rebuild our infrastructure.

And if a frog had wings he wouldn't bump his ass a-hoppin'

[sinkingfeeling]

3. But eliminating the cap will only fund today's benefits. There was a post with a great graphic

about that this morning, but I'm too busy to look for it. So you still would need to fund those additional 8 years per person in some other way.

[Recursion]

4. Well, accounting-wise we could eat into the trust fund

Though that would be robbing Peter to pay Paul since ultimately taxes would have to go up to pay for the redemption of those bonds. So, yes, this would ultimately involve raising either levies or taxes. But so would a "normal" jobs program.

[Kurt_and_Hunter]

5. The problem is it would be a very inefficient jobs program

I applaud any kind of thinking about how to improve the employment situation.

Funding 8 years of SS out of general revenues would, however, be very expensive per job versus just hiring people with the same money.

No problem with your motive, though.

[Recursion]

7. Yeah, I don't think this would work as a single solution

But, I guess it's kind of playing around with the idea that lowering the retirement age should be considered a stimulus and raising it should be considered a depressant (depressus?)

[sinkingfeeling]

6. Yep.