Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

Krugman: Early Social Security Projections

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » General Discussion: Presidency Donate to DU
 
ProSense Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 04:31 PM
Original message
Krugman: Early Social Security Projections

Early Social Security Projections

<...>

You see, in discussions of Social Security it’s often argued that in the program’s early years, nobody could have imagined the increases in life expectancy that have actually occurred, so nobody could have imagined that we’d have as many beneficiaries relative to the number of people of working age. And I thought I knew that this was wrong — that people in the 30s and 40s did know about rising life expectancy, and expected it to continue.

Well, it turns out that Table 9 in the 1945 report (pdf) shows high and low estimates of the population distribution looking forward as far as 2000, which we can compare with the actual population distribution in 2000.

What you can see right away is that the SSA expected a much smaller population than we actually ended up with — the baby boom and immigration weren’t anticipated. But they also expected a somewhat older population than we actually got: their “low” estimate put the ratio of seniors to adults under 65 at 20.8%, almost the same as the actual 21.1%, while the “high” estimate put the ratio at 29.1%. That is, in 1945 the Trustees thought that America would probably be a grayer, older country by 2000 than it actually ended up being.

All this has only limited bearing on the future, as we move into an even older country. But it’s still interesting, at least insofar as it debunks a common Beltway legend.

Fascinating.
Printer Friendly | Permalink |  | Top
Hannah Bell Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 04:35 PM
Response to Original message
1. kr.
Printer Friendly | Permalink |  | Top
 
SheilaT Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 04:45 PM
Response to Original message
2. Thank you for posting this.
The one thing they simply could not have foreseen in the early 40's was the population boom of the late 40's into the early 60's. We also wound up with a lot more immigration after the change in the immigration laws in 1964.

Since illegal immigrants don't collect social security, despite what the Right tries to claim, they don't matter except that many of them do pay in and will never collect.
Printer Friendly | Permalink |  | Top
 
OHdem10 Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 05:17 PM
Response to Original message
3. Thanks. Important for us all to keep this stashed in our minds
for use as the debate heats up.
Printer Friendly | Permalink |  | Top
 
inna Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 05:28 PM
Response to Original message
4. indeed.
Printer Friendly | Permalink |  | Top
 
boppers Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 10:01 PM
Response to Original message
5. So, they got it close..... for 10 years ago.
I wonder what's different between ten years ago, and now, and ten years from now?

Oh, that's right. The Boomers.
Printer Friendly | Permalink |  | Top
 
Igel Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Jan-16-11 12:07 AM
Response to Reply #5
6. It's also worth pointing out that the numbers don't "work" using current assumptions.
There are far more adults >=65 years of age than there are SS beneficiaries >=65.

Currently, the 65+ group / 18-64 is important. Why? Because most adults work. Most adults collect SS benefits when they retire.

In 1945, a lot of women, it was assumed, wouldn't work. Moreover, a lot of retirees wouldn't collect SS benefits. So the ratio Krugman points out, while crucial today, isn't really all that meaningful. Of course, the "low" assumption is only nearly met because, as you point out, the baby boomers swelled the <65 group for a while and now will swell the ranks of the >65 group.

Now, the only reason that anybody cares is because that ratio, payees:payers, helps inform debates about benefit levels. Now. If you look at the 1945 assumptions you see that the number of workers paying it who wouldn't collect is anywhere from 40-48% of the retirement-aged male population. In other words, you would have far lower taxation rates, lower pay-out rates, and lower beneficiary rates.

His point is accurate. It's also specious. He does that in the NYT quite a bit, and it's really, really annoying--he'll cite a # but it won't mean what he assumes you'll assume it means. He's correct, if anybody accuses him of being misleading; but "correct" and "misleading" aren't contradictory terms, and it's misleading to assume they are.
Printer Friendly | Permalink |  | Top
 
DU AdBot (1000+ posts) Click to send private message to this author Click to view 
this author's profile Click to add 
this author to your buddy list Click to add 
this author to your Ignore list Wed Dec 11th 2024, 10:19 AM
Response to Original message
Advertisements [?]
 Top

Home » Discuss » General Discussion: Presidency Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC