A Broken System
SOC 304: Social Gerontology
October 29, 2012

The Social Security System, created in 1935, is the one of the most costly items in the federal budget today. The program was created to provide old age, survivors and disability insurance to a large portion of Americans, mostly the elderly who are now out of the work force. The Social Security Act was a major turning point in American history Today the U.S. Social Security system has been in the news a lot lately. While politicians throw around dramatic words like crisis and bankrupt, regular Americans have more concerns. Social Security has assisted to defend millions of employees from scarcity in their elder years, but demographic truths have transformed over the last seventy years and are still altering. (Smith, 2010)
If Social Security does not transform with them, the system will be incapable to fulfill its guarantees to tomorrow’s retirees and will load the next generations, our children and grandchildren, with hard taxes. The President would let Americans save some of their Social Security taxes in personal retirement accounts that they own and that Congress can never legislate away. Personal retirement accounts would strengthen Social Security by assisting all US citizens to raise their retirement income and pass on a nest egg to construct a better fiscal future for their households. (Smith, 2010)
Several Social Security professionals think the system is in crisis because it will soon be incapable to fulfill its guaranteed distribution payments to qualified retirees Republicans and Democrats tend to have extremely different concepts not only about how the Social Security system should encounter this disaster, but they also vary considerably on how the regime should address personal retirement requirements.
The major cause for the looming monetary crisis is that our community is aging. As a consequence, there are fewer employees to support each retiree than when Social Security was made. Over the next many years, the number of retirees is anticipated to grow more quickly than the number of people whose taxes will pay for future benefits.
This future is coming with steady speed. Social Security's annual cash surpluses will begin to fall in 2012, the same year that the first baby boomers reach early retirement age. Over roughly the next 10 years, those Social Security surpluses, about $100 billion a year at their peak will continue to shrink and then disappear completely. Without those surpluses to reduce the size of the federal deficit, Congress will have to raise taxes to bring in billions of dollars of new revenues, cut programs, or let annual deficits climb.
If the U.S. isn’t careful, we will fall deeper in debt. We look at countries such as Greece and how they had its national debt restructured by the European Union to avoid national bankruptcy. Europe has very significant, and sometimes underappreciated, strengths on which to build a sustained recovery. As the world’s largest integrated economy, Europe is home to 124 Fortune 500 corporations. Several European countries have successfully reformed labor and product markets and can now serve as examples for others to follow. Europe is home to some of the most vibrant cities in the world and has a high quality of life.
Many factors have contributed to the growth in federal welfare spending, causing it to rise during times of both high and low unemployment. Persistently weak GDP growth over the last several years is unquestionably a factor in the record amount of money now being spent. But understanding the growth in federal welfare expenditures must also be understood in the context of a federal policy that has explicitly encouraged growth in welfare enrollment--combined with a weakening of welfare standards and rules. (Proquest).
In theory, there are two easy answers to any budget problem is increase income in this case, raise the percentage taken out of workers’ paychecks for Social Security or reduce spending in this case, cut the amount paid out in Social Security benefits. In reality, neither of those solutions is simple, since raising taxes is never a popular political decision, and cutting Social Security benefits will negatively affect millions of retirees.
In conclusion, several Social Security professionals think the system is in crisis because it will soon be incapable to fulfill its guaranteed distribution payments to qualified retirees Republicans and Democrats tend to have extremely different concepts not only about how the Social Security system should encounter this disaster, but they also vary considerably on how the regime should address personal retirement requirements. As the baby boomers retire, the outputs are going up. Combined, the annual surplus that social security had is now effectively gone. This means we are going to need to start paying money into social security and also find money to use to pay the interest on the national debt

References
Summary of CRS report revealing federal welfare now larger than medicare, social security or defense. (2012). (). Lanham, United States, Lanham: Federal Information & News Dispatch, Inc. Retrieved from http://search.proquest.com/docview/1114034350?accountid=32521 http://www.fedsmith.com/.../social-securitysdayof reckoninghascom.net
http://www.socialsecurity.com