John Ydstie, NPR
Members of Sun City, Arizona's West Valley Biking Club. From left: Herbert Cuevas, Paul Nystrom, Don Pearson and Bernhard Kalkhorst. As retirees live longer, the number of workers paying into Social Security is lagging behind.
John Ydstie, NPR
President Bush has put reforming Social Security at the top of his second-term agenda, calling a projected $3.7 trillion funding gap over the next 75 years a "crisis" that requires dramatic action. The centerpiece of the president's plan would divert Social Security taxes into private accounts.
Zandi says the private accounts proposed by President Bush will not solve the projected gap in Social Security funding, but will create a system of winners and losers.
Listen: Mark Zandi, Chief Economist of Economy.com
Smetters, who worked on President Bush's Social Security commission, says private accounts won't deliver higher total earnings for participants, but they will raise benefits for the lowest-income workers.
Listen: Kent Smetters, Assoc. Professor at The Wharton School of the Univ. of Pennsylvania
Opponents argue private accounts would worsen the problem. They say there's no crisis and the system could be fixed with relatively minor changes. And polls show that a strong majority of seniors agree that Social Security needs only minor fixes.
For the current generation of retirees, Social Security provides about $14,000 a year and replaces about 40 percent of the average worker's pre-retirement wages. One in five retirees relies solely on Social Security for income. For two out of three retirees, the program provides more than half of their financial support.
In the first of three reports on how Americans of different generations view Social Security and the president's proposed reforms, NPR's John Ydstie talks with retirees in Arizona and Pennsylvania.