Sunday, July 22, 2012
New School economics professor proposes partial privatization -- on top of today's social security
The New York Times has an op-ed on p. 5, Sunday Review, by Teresa Ghilarducci, “Our Ridiculous Approach to Retirement”.
She says that 70% of Americans nearing retirement have less than $30000 in savings. Typically, a retiree needs 20 times his best wage (less if a home is paid off or a spouse works). That would mean that to continue a $100000 a year lifestyle, including social security, one would need $2 million in wealth accumulated. That would probably include buying a long term care policy.
The economics professor (from the New School of Social Research in New York ) says that the US should layer a mandatory private retirement annuity program with guaranteed returns on top of social security (which could be gradually means tested). So, in a liberal school, she is making a somewhat conservative (or Cato-like) proposal for partial privatization.
The link is here.