Working Paper: NBER ID: w9166
Authors: John F. Cogan; Olivia S. Mitchell
Abstract: Recently we were asked to serve on the President's Commission to Strengthen Social Security (CSSS) along with 14 other members drawn equally from both major political parties. The Commission's charge was to provide recommendations to modernize the Social Security system, restore its fiscal soundness, and develop a workable system of Personal Retirement Accounts. This paper explains how the Commission arrived at some of its recommendations and the role that economics played in contributing to these recommendations. We describe the key institutional constraints confronting efforts to reform Social Security and how these constraints influenced Commission decisions. We also illustrate how economics research influenced the Commission's analysis of how to structure personal accounts, ways to enhance traditional Social Security program finances, and means of measuring the extent of financial progress achieved through reform.
Keywords: No keywords provided
JEL Codes: H6; H3; H4; H5; I3; G2
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| economic policy (E60) | social security reform (H55) |
| economic research (A14) | commission's analysis of personal accounts (D14) |
| institutional constraints (D02) | commission's decisions regarding reform recommendations (G18) |
| past congressional behavior (D72) | current recommendations (Y50) |
| financial unsoundness of social security (H55) | workers saving less (D14) |
| financial unsoundness of social security (H55) | workers retiring early (J26) |
| low returns expected from social security (H55) | savings deterrence among low-income retirees (D14) |
| prefunded social security system (H55) | alleviation of financial burden on future generations (H60) |
| personal social security accounts (H55) | insulation from political pressures (D73) |
| congressional tendency to spend social security surpluses (H62) | impacts on financial viability (G32) |