Who ever runs for president has to explain their approach whoever becomes president might have to begin to deal with it. Social securitys future, its inside story. Welcome to inside story, im ray suarez. During his years as house speak are, grin used to newt grin give used to tell the story that the young would more likely think theyd meet a ufo than cp collect Social Security. Reporter if you hear talk like this on College Campuses about Social Security you may not be surprised. I think its a failing system like everyone believed it would be. Like growing up thats what they told us. We werent going to get Social Security bit the time we retired. Reporter for decades conservatives painted Social Security and medicare as doomed. Its true the programs will drain the surpluses built up over the last 30 years, without action by congress raiding taxes or cutting raising taxes or cutting benefits Social Security will have to make cuts in payments by 2033. Medicare the Government Programme providing Health Insurance for the elderly is on the same course. This month president obama convened the once a decade white house conference on ageing insisting the programs were not in crisis but only offered a vague strategy for the future. We have to keep Social Security strong. Protecting the future solvency. I think there are ways creative ways to talk about to direct future solvency but strengthen required and security for our neighbours. Economists and politicians ta the solution is to raise requirement to 70. Others including the Congressional Budget Office say it will not save money, and could be political suicide for candidates or members of congress. The odds are against anyone acting soon. When its enough of a crisis well make the changes. It will be more abrupt. Instead of dealing people over the age of 50 that we are not raiding the ages. If america wants a peak if they expect the president s to want too much and not cost money, look at greece. A troubling pred iction for young and old at like. For now, conversation that could calm fears about the future will have to wait if you are in your 30s and 40s, an are you planning retirement around a future cut in benefits in case. If you are in your 50s or 60s and have not collected, have Social Security taken on a larger role in your support than you anticipated when younger. Well start the programme with Mary Beth Franklin contributing editor at Investment News. You covered this part of the economy a bit. Recently the trustees made their prorp. What is the report. What is the diagnosis. Is the programme in trouble or need of a tuneup . Well the surplus trust funds that we draw on when theres not enough taxes to pay benefits will continue until 2034. But we cant wait until 2034 to fix this incredibly important retirement programme. The sooner we take steps to fix it, like in 1983, those reforms more than 30 years ago are still not fully implemented. If we take steps now to fix longterm financing them be less painful than waiting until the end. Has the date that you are talking about, when we have to cut benefits if we didnt do anything else been moved closer by the effect of the great recession. People retiring earlier than planned or finding there was no work for the economy. Or making smaller contributions because they were earning less money. A combination of both. A lot lost money. If you dont have a job, you pay less taxes. You have people that shouldnt find jobs. Going on benefits earlier than they thought. Collecting benefits as early as they could. Rather than waiting for the full retirement aim, yes, it was a combination. Whats was we are paying full benefits buts there wasnt enough money from the payroll taxes, we had to tap those surpluses, the trust funds sooner than we had anticipated, and well continue doing that. Until the trust funds run try. The trust funds are a guarantee. They assist in bonds. Theres no file draw at the Treasury Department that opens up the cash saying this is the Social Security trust fund. It is money collected, earmarked from payroll taxes and when its not used to pay benefits. The surplus is lone to the federal government. But the government pays it back with interest. Its another source of income. In is two different pockets in the long trousers isnt it. You are taking money out of one place and paying it into another. You have one camp saying Social Security is self financing. You have others saying however, because the government has to go out and borrow money, it adds to the deficit. Its two different pockets. Is there embedded in this conversation an aspect of generation generational matters. When politicians who say to the older people dont you worry, we are not going to touch your benefits well touch theirs over there is there a problem . I think so. People worry about what happens to their children and grandchildren. The heart of the Social Security chin is this is not welfare, it doesnt come from the general revenues. Its what people paid in every one of their paychecks from the time they are flipping burreders, all the way to the time they retire. People are vested in it. They have invested in it. People want the benefits to which they feel they are entitled. They are willing for change as long as they are forward looking. The last major returns, they are not fully implemented yet. Americans can adjust to anything for people country receiving Social Security or near to retirement. This is a chunk of their Retirement Security in an era where the pensions have all but gone away and Savings Rates are so low people cant stick the savings they have in a bank account. We have about a minute left. What was so monumental about the mid 80s that you were able to force the stakeholders to the table to hammer out a new path for the programme for the next several decades. We have perhaps a dysfunctional congress. It was no picnic in 1983. We had ronald regan and the white house, tip oneill. They didnt see eye to eye, but knew how important Social Security was and said they have to fix it and they appointed a bipartisan commission. And headed out that commission and they were able to work it out. This congress has to learn how to Work Together and compromise its not a mathematical problem, its an easy fix. A contributing editor Investment News thanks for joining us. Remaking Social Security was the third rail of american politics if you touch it. You have to electro cute it. One of the marks of a serious contender is ready to talk about higher retirement lower benefits or scrapping the difference Social Security its inside story. Youre watching inside story. Im ray suarez. Social securitys future this time on the programme in the recently released annual report if Social Securitys trustees Disability Insurance, old age pension and medicare are found to be in serious longterm trouble. The trustees predict the costs will grow faster than the economy year after year and the two programs represent 42 of spending. With so many saving so little and looming funding problems Social Security is crying out to be overhauled. Joining me for the rest of the programme. Lacy crawford. Communications director for Social Security works. Logistics of business and public policy. And kevin director of justice and ageing is this several problems depending on which time arising. The immediate term we can pay the benefits for the next 20 years. Longer term we have a problem. Think of to this way, theres a pie. Its what we produce, and we have to have a system for transferring the income for people too old to work to give them a slice of the pie. We can talk about all kinds of schemes, but it comes down to younger people transferring a piece of what they earn and create. Right now the slys is larger and larger because we are not growing rapidly and we havent raised a retirement age. People are living longer. How do we design a system going forward. Well have to address some problems apt some point. Whelm be forced to. In a way that allows the core accomplishment of Social Security to be sustained to lift elderly americans that used to be majority poor out of poverty . Yes, thats an important point. Every year Social Security lifts 22 million out of poverty, and is the most successful programme history, any changes we make we need to make in relation to the programme and the role for seniors and people with disabilities and their families. There are important and changes that we can make that do strengthen the programme without cutting benefits. Like what . Well like one would be lifting the cap on benefits that are wages subject to the tax. They are public resoundingly supporting the move. Right now the 118,500 dollars of wages are subject to Social Security tax. If we gradually lift the cap or eliminated the cap, wed solve the longterm Funding Crisis for Social Security easily. A proposal would be to increase the tax rate the Social Security rate. We could do that gradually over time it would increase the solvency of the programme for decades. And these are proposals that are broadly supported by the american public. Lacy crawford a cynic may suggest they are broadly supported by the american public, most dont get near the 118,000 cap many dont know theres a toilet you stop paying. Paying. Theres a point you stop paying f. B. I. Inga. Thats right. When im on the road talking about the cap, at 18,500 of income. They are surprised. My organization seeks to educate the public and members of congress about the requirement income crisis and so we are in favour of expanding benefits. For one, we view the programme as a system. We view it as a system it protects against the loss of wages, and also for disability yip, and also if we lose a loved one, a spouse. Once people here about a cap on it the first thing i hear is fairness. We want to make sure the boar the rich everywhere is paying into it. When you think of the money and by in and people advised in the programme, is Social Security too big to change. People lived with children on the farm. Its hard for americans to imagine. Most americans were farmers. Its not the truest programme. The benefits you bets are in proportion to what you pay. As income rises, the return you get goes down if you are in the lower half of one half of 118, 500, you get more ben mitts than if you are above that. If we expand the cap, soefrling the problem that way, we have the volume of buy in. They have to be shorted a lot. The reality is that home are living longer and capable of working longer. Why shouldnt they work longer so theres not a train on the system. At the end of the day, you cant have a society where youic make the pie, and the reg you give away is so much that it kind of the creates too much of a purreden on the workers and they dont want to do it. It doing nothing a legitimate possibility or in the counter admoss fear a political necessity, constantly replenished. It cant run out of money as some suggest. If we cant agree on what to do why not let it be. Social securitys future. Its the inside story. Welcome back to inside story im ray suarez. The last 35 years is one of jawdropping deficit spending since the 1980s, congress spent billions beyond federal government revenues and papered over the deficits using the money, but not paid out in the same years as benefits. After using Social Security surpluses for spending many officials announce the the programme broke, demoonding cuts in benefit. How about doing nothing. We have known the short falls have been coming for years. Has the cost of fixing Social Security and medicare get so high that doing nothing is politically possible. Kevin printeder victim. You have seen all the numbers, all the reports. And you have seen all the inaction. Do we need a fullblown crisis to move people to some solution. Well we have a crisis but not a crisis we think we have. We have a retirement crisis. With crowing numbers of people ageing in the poverty, we have a crisis of economic security. What we need to do is not talking about proposals raising the age or cut benefits. It 10,000 people turned 65 every day. More and more of those folks, because of changes in the structure have a hard time changing. Social security is an important source of the income. They dont have a pension, they were not able to stay. Wages were stagnant. Health care costs are growing for people that are older. All the things together mean one Social Security is important. Perform they are not enough to keep up with the costs of growing hold. We need proposals expanding Social Security. Theres proud income. To do that we have to pay more. Over 70 of americans would rather do that. Thats where the focus needs to be on. Peter when i tried to talk my father into working a couple more years, it was like giving him a raise and he was healthy. He had gone to work at 16 and was in his mid 60s he said he felt the last 16 years on his feet. He said im tired, my feet hurt i dont want to the work. For people in white collar occupations, i think the idea of working a couple more years, becoming a consultant working freelance or from home seems attractive and responsive to the way the economy is changing. For millions of americans, thats a bitter pill. Its important to remember the Blue Collar Workers is a smaller proportion with what we do. More are making their living with their brains. They face problems because of changes in the economy. For example, we didnt have i. D. Specialists. On the other hands other jobs existed that are going away. The number of secretaries we had. They are sitting down. They dont have to smash the typewriters, they have soft key boards. The reality is the number of Administrative Assistance and secretaries in the office are disappearing. If you are 55 and lose your job because of that its hard to get another squad. The reality is its not reasonable to tax people more. Thats the basic message we get from san francisco. People are saying theres a vast majority of people it reminds me of the classroom with 28 people moderating incomes and two rich kids and the class decides to go to paris, how will we pay for that. The two rich kids will have to pay more. That 70 is not going to pay the taxes. Before i sound too right wing i have to come from the conservative side of thing. Well have to do something about the structural problems. We have to open up avenues for career Transition Training and opportunities and change employers expectations of people so they are willing to higher them. If you are 63 and bushing rewalk in the and walk in the door people say youll be gone in two years people are able to be productive. How do you get buyin and address the issues. Everyone the majority of people there, those that have the money should pay, doesnt seem to be a just outcome either. August 14th Social Security. It hasnt missed a payment in 80 years in a couple of weeks. Its something that we built. All of us together. Never missing a payment. To claim that we should raise the retirement age thats a cut across the board. What do you say to a majority of americans out there working, out there working standing up all day long. Why dont you work a little bit locker. Thats not fair to them thats the issue of fairness. Everyone has not lived long. We have to count on being able to supply benefits for more years of life for millions more people too. Thats more money in the pot. Are you denying people are living longer. Some people are living longer. Minorities are not living longer. They may not live as long as majority folk but they are living longer. Fastest growth is people over 80. We have to disagree about the minorities. We should have two sets of benefits. One for minorities, one for the white folks. What do we do about the fact we have a larger percentage of the population over 65. It becomes too much of a burden to bear. Its not going to continue to extend. Because people are not seeing the labour we dont have 70 of the population. How do we deal with that. One thing that has changed is when Social Security began, you didnt have an expectation you would be collecting for long now you may be collecting for decades. How do we change the system to reflect that. I have to agree, theres a tax cap. We have to eliminate and have everyone paying the same rate. Its an issue of fairness. Like i said before not to sound like a broken record it hasnt missed a payment in 80 years. We have to look at Social Securitys finances every year and it has to be mapped out for 75 years into the future. These things are a chris sees. It should be addressed sooner rather than later. Its not bankruptcy. Im going to have to to it there. Lacy crawford. Kevin prinderville. Prove store of logistics and public policy. Ill be back with say sable and unsayable parts of Social Security. Stay with us, its inside story. Bridge that. A lot of innocent lives are still being lost. Comedian mo amer. Are we filming a short . Whats happening . Year after year Social Security and medicare are found to be unpopular and valuable programs. When i look at the f. B. I. Inga deduction on my pay stub i dont think of my own check as much as i think of my fathers check, a modest Monthly Payment that allows him to augment his savings, and live in security and dignity. It would be hard pressed to know someone that is not supported by disability or after the death of a spouse or old age. A fascinating aspect of necessary and ongoing debates about the future of the programs is the scorn heaped on them from a faction of one of the two governing parties, even assist so Many Americans rely on it working just the way it does now. Even solutions involving retiring later and taking less money, coming from men and women that will not rely on social stability. Those are the same men and women who oversaw spending the surplus paid in by the baby boomers. It would be claper and less painful to address the problem immediately, but fitching the smaller problems like the Disability Insurance programme has been too difficult for the elected officials. It looks like theyll need a crisis to focus their attention and hours on addressing a vital part of our common life. Im ray suarez, thats inside story. The taliban confirms its leader is dead and names a successor. Peace talks are put on hold. Im Darren Jordon in doha ahead, debris found in the hunt for missing Malaysia Airlines flibility mh370 sent to france for testing. British workers move in to strengthen security at the tunnel as the migrant crisis worsens it was a family hare loom passed down for 50 years, now one of the oldest baseball cards in existence