jobs. it's interesting when you look -- ♪ >> your involvement on the board, whose business includes shipping jobs overseas, outsourcing. >> i've never voted to outsource jobs. it's interesting when you look -- [ laughter ] ♪ >> anyone who turns on the tv these days knows we face challenges to our way of life. radical islamic terrorists are

threatening to cause the collapse of our country. president obama and senator shaheen seem confused about the nature of the threat. not me. i want to secure the border, keep out the people who would do us harm and restore america's leadership in the world. i'm scott brown and i approve this message. because protecting the homeland is the first step to making america strong again. >> they don't call us the granite state for nothing. we're tough here. i never back down for a fight for the people of new hampshire. i don't work for the big oil companies or the big banks. i work for you. shaving jobs at the shipyard, allowing people to compete. allows families to refinance loans and veterans close to home. getting the job done for new hampshire. i'm jeanne shaheen. i approve this message. i diplomat just move here. i've been here fighting for you. i'd be honored to have your vote. >> recent polls list this race as a toss-up. can you watch the most recent

debate between senator shaheen and scott brown any time online at our website, c-span.org. next, remarks by jason furman, chair of the white house counsel of economic advisers on why he thinks it's critical to make changes to social security in order to sustain the program for future generations. his comments came as national academy of social insurance released findings of a new study exploring americans' views on social security. this is about two hours. well, i'd like to welcome all of you to this national academy of social insurance event. my name is william arnone. and today we're releasing what i think is a very significant second study in which the

american people were asked in a very systematic way, as you'll hear, what would they prefer as the solution to social security's long-term financial chal he engs? i don't know how often we get the chance to do surveys that force the american people to make tough choices. and that's what this survey did. and it really -- i view it really as the voice of the people on this very important. it's the crown jewel. when the mesh people are presented with facts about it, it's surprising how they come up with very sensible and in some ways sacrificing answers, as you'll hear. i get to washington periodically from new york. i can't imagine another issue where in this city there's across the board agreements whether it's in politics, the arts, sports, maybe agreement

the washington capitals will never win the stanley cup. other than that, there's really not a lot where people agree across the board. and yet on social security, as you'll hear, there is broad agreement. by broad i mean across generational lines, geographical lines, income levels and even political affiliation. so it's a unifying issue if the american people are listened to. that's really the challenge. that's the reason the academy and our mission is to educate the american people about why we have programs like social security, medicare, unemployment insurance. so, we're going to be discussing this. before we do that, i do want to thank two of our sponsors who made this report possible, the ford foundation and the tufts health foundation. i have a particular warmth in my heart for tufts. my daughter is a junior there and she loves it. that has nothing to do with

supporting this survey. we really appreciate, though, what they did. there is a blue evaluation form in the materials that you were sgich. and we really hope you'll take the time at the end of this to provide us with candid feedback on the value of this event or things you might have hoped for that we didn't provide. please promise to fill it out before you leave today. in terms of the order, my colleague alisa walker with describe the study's finding. matthew greenwald will show how it shows informed and sometimes difficult choices. then we're thrilled jason furman, who chairs the counsel of economic advisers and also a member of the national academy of social insurance is going to join us to comment on the study and address some of the issues the study raises. then we'll have an outstanding panel on hand this morning to provide their perspective and also answer any questions you might have in the course of the

presentation. so, let me introduce lisa walker to you. alisa is an income policy analyst with the academy. and she's part of a generation -- i was talking to her earlier, generation "y" doesn't seem to be the label you like, millennial. my daughter clearly does not want to be called generation "y," prefers not to be compared to other agagenerations like "x" boomers, forget it. notice need to be compared to us. and she's really the voice's generation. as you'll hear, the survey found some disturbing opinions on the part of that generation when they were asked, will social security be there for you? however, the more facts people are given, the more they understand that social security's future is much better than they were led to believe. and alyssa, of course, does not share the gloomy view because she has been steeping herself in the facts, as you'll hear. she really has had a commitment

to developing objective facts and findings on social security. so, to some extent the survey is a very natural continuation of her career. and she'll be fouled by matt greenwald, who directs the research firm that bears his name. as you'll hear the method olg they use, novel tradeoff methodology really makes this survey unique, its findings, and i think it makes it much more meaningful than other types of methodology that don't force these tough decisions. after the panel discussion we'll have time for q&a. if during the time of the question, feel free to ask it. otherwise we'll ask you to hold the questions until the panel -- alisa, let me start with you. she'll take you through what the survey found. >> thank you, bill. it's a pleasure to be here to

present find rgz from academy public opinion study. americans make hard which choices on social security. the study consisted of three related parts. we conducted focus groups in baltimore. we then conducted an online survey of 2,000 americans age 21 and older about their attitudes towards social security and the importance of benefits and their views on policy changes. as part of the online survey, we used an enter active trade-off analysis method to learn which social security changes americans prefer and are willing to. we partnered with greenwald and associates and matt will discuss the tradeoff analysis in more detail. i want to start with just a couple of key facts about social security to lead into explaining why we did this study. first, social security is the foundation of retirement security for most americans. benefits are modest. under $1300 a month on average.

yet the main source of income for two out of three seniors. benefits keep 22 million americans out of poverty and without social security, more than half seniors would live in poverty as defined by the supplemental povertity measure. social security finances need attention. social security faces a long-term financing gap. it can pay full benefits until 2033 but after that would only be able to pay about three-quarters of benefits. in order to pay full benefits, social security needs adjustment. that's where the study comes in. as lawmakers deliberate various options for adjusting social security, the national academy of social insurance undertook this study. the survey first asked respondents their attitudes on social security benefits and have on paying fror the program. 7 in 10 said without social security they would have to make

significant sacrifices or wouldn't be able to afford the bakes in retirement. thins like food, clothing or housing. large majorities of americans say they don't mind paying for social security for a variety of reasons. 73% agree with that statement that they don't mind paying for social security because they know they'll be receiving benefits when they retire. 73% again know without it they would have to help support their parents or other relatives. and moefs all, people value the security and stability that social security provides millions of americans. 81% of respondents say they don't mind paying for social security because of that. the following chart shows responses to that last statement by political party. 72% of republicans, 87% of democrats and 81% of independents say they don't mind paying social security taxes because it provides security and stability to millions of americans.

large majorities agree across generation and income lines as well. americans not only don't mind paying for social security, they also indicate they would consider increasing benefits. 85% agree social security benefits now are more important than ever to ensure retirees have a dependable income. nine in ten say current benefits don't provide enough income to retirees. more than 7 in 10 say we should consider increasing social security benefits. however, as we all know, there's no free lunch. increasing benefits comes with a cost, so we all explored americans' willingness to pay somewhat more for social security if needed. nearly 8 in 10 respondents agree with the statement, it is critical we preserve social security benefits for future generations, even if it means increasing the social security taxes paid by working americans. that includes about a third who strongly agree.

and more than eight in ten agree if it increases social security taxes paid by top earners. so, large majorities of americans believe all workers could contribute somewhat more to social security if necessary and that better off americans could pay more because they have higher earnings. this holds true across generations. the following chart shows political party. those agrees working americans could pay more include seven in ten republicans and eight in ten democrats. those earning the top earnings could pay more include a striking seven in ten republicans and nine in ten democrats. these issues -- these responses leave no doubt that on social security, americans are far less polarized than they are on many other issues. in another part of the study, we used tradeoff analysis to

examine which social security changes americans prefer and are willing to pay for. respondents examined 12 social security policy changes including four revenue increases, four revenue increases. each option was presented with a short description and an estimate of that option's impact on social security's financing gap. i won't read through the entire list of options but it's available in the short report and the highlights brief you picked up on your way in. and that will be going into more detail on the tradeoff methodology so i'm going to skip straight to the findings. the tradeoff analysis found that americans preferred package of changes to social security would do four things. first gradually eliminate the tax cut over four years. this means 6% of workers who earn more than the cap would pay into social security all year long as other workers do. in return, they would get slightly higher benefits. second, it would very gradually

raise the social security tax rate from 6.2% to 7.2% over 20 years for workers and employers each. the increase would be so gradual that a worker earning $50,000 a year would pay about 50 cents a week more each year matched by their employer. third it would increase social security's cost of living adj t adjustment or c.o.l.a. and, fourth, it would raise social security's basic minimum benefit so someone who paid into social security for 30 years can retire at 62 or later and not be poor. these changes would more than eliminate gap. specifically the package eliminates 113% of the shortfall under assumptions of the 2013 trustees' report which was the most recent available when the survey fielded in june and 107%

under the newer 2014 trustees report. this preferred package is also the same as what americans preferred in 2012 when the academy's prior study was conducted. seven in ten americans would prefer this package of changes over the status quo. and study across generations, income groups and political parties. in each instance, about seven in ten respondents prefer this packa package. tradeoff analysis also allows us to learn how respondents weigh the appeal or lack of appeal of individual policy options. for example, some options have a strong positive impact. meaning that respondents are much more likely to choose a package when that option is included in this. four options with strong positive appeal were gradually eliminating the tax cap, gradually raising the tax rate 7.2%, keeping the retirement age at 67 rather than raising it,

and increasing the c.o.l.a. four other options have strong neglect ty appeal. they rpt not lifting the tax cap, not raising the tax rate, raising the retirement age to 70 and lowering the c.o.l.a. now, that was from the trade-off analysis. in the survey we also asked respondents their views on policy options one at a time. using a very direct question, do you favor or oppose this option? that's clearly a different methodology which looked at each option. but the results are consistent. here's one way of depicting these survey answers on individual policy options that makes the choices clear. it's small on the green but also available in the fact sheets in your folders. so, in this graph the green bars above the access indicate respondents who say they somewhat or strongly favor each

option. and the red bars below the access indicate respondent who is somewhat or strongly oppose the option. as you'll notice the four options in the package also received high levels of support on these survey questions. for example, looking at the first bar, more than eight in ten respondents say they favor increasing the tax rate to 7.2%, including nearly four in ten who strongly favor that option. options to reduce benefits generally received low support. for example, in it is second to last bar, three-quarters of respondents opposed raising the retirmentd age to 70, including more than four in ten who strongly oppose it. the report has very interesting findings in americans' confidence in social security. despite their support for the program and their willingness to pay for it, six in ten

respondents say they are not confident in the future of social security. we also asked americans who are not currently receiving benefits whether they expected to get all their earned benefits when they retire and nearly seven in ten said no. in addition, one in four americans knew social security would still be able to pay about three-quarters of benefits after 2033. most of the rest thought social security's finances would be in far worse shape. 30% thought the program would be unable to pay any benefits at all. so, next we tried a little experiment. we asked people what they think of social security's funding in the future. is it a crisis, a significant problem, a manageable problem or not a problem? 70% said they thought it was a crisis or significant problem. and 30% thought it was a manageable problem or not a problem. that's not too surprising given the low levels of confidence in social security that i just mentioned.

but what's noteworthy when you give more people information, these proportions flip. the share of people who thought social security funding is a crisis or significant problem dropped from 70% to 33%. while the share saying it's a manageable problem or not a problem rose from 30% to 67%. that was after learning that raising social security taxes from 6.2% to 7.7% for both workers and employers would ensure the program could pay full benefits for the next 75 years. so, accurate information helps people better assess the scope of the challenges that social security faces. i'm going to add a couple concluding thoughts. findings were consistent across the three parts of the study and the focus groups participants were concerned about benefits being too low, whether they were considering their own future benefits or more often the benefits they see their parents

or grandparents receiving. in the survey, large majorities of republicans, democrats and independents say they don't mind paying for social security. they want to consider increasing benefits. and they would be willing to pay more for social security if needed. and in the trade-off analysis, the preferred package consists of two benefit increases and two revenue increases. second, better information could improve public knowledge about social security and confidence in social security. and finally, americans may be polarized on many issues, but on social security, they are remarkably in agreement. americans across political, generational and income lines, not only support social security, but also agree on specific changes for the future. and with that i'll turn it over to matt greenwald who will tell us more about the trade-off analysis of the stud request. thank you.

>> thanks and good morning. let me just say by background, most of my work is in the private sector. and a lot of my clients have this fixation about offering products people will buy in a competitive world, that people will prefer over their competitors. they don't care that much if they like the car, they want to like it better than what their competitors are offering. in 1978 a statistical technique was developed by professor of pennsylvania often called trade analysis. since 1978 it's been used more than numerous times because a lot of private sector companies don't want to build a product and see how it works. they want to do research first before they put the car into the factory. this trade-off analysis has the

benefits of identifying the preferred package, including costs, as someone once told me f you're doing analysis, the one is the least attractive. and identifies the impacted of each feature on preference. so, if i can give you the example of a car. a car can have numerous features. it can have engines of different size, transmission -- transmissions of different quality, a backup camera or not, different types of sound system, leather seats or cloth seats. each feature has a cost. and there could be easily 300 combinations. which is the best. they want to know the best. but you can't ask an individual 300 questions and expect quality

answers. and the genius of trade-off analysis, if i can use that word, is by properly aligning the choices. you can ask eight to 12 questions and estimate how people would respond to each of the 300 using basian math, basically. also understand the impact of each one. so, the objectives we had in working with nasi were to understand the preferred package of social security benefits where there are a couple hundred different possibilities. make sure that each of the costs was savings of each feature is taking into account when determining a preference. of course, people want more -- higher benefits, but are they willing to pay for it? and if you're interested in closing the financing gap, which

survey indicates people are, how do you go about doing it? also if you're looking at different features and trying to make the trade-off decisions, what is the value of each feature? some features have the benefit, quote/unquote, of closing the financing gap. others increase the financing gap. what is the reaction to each one? understanding that the goal is to get the best package. that's where we're interested, the best package at the best price. what do americans prefer? this is what we did. alyssa reviewed it. i want to say it again. we tested 12 specific changes or features. some cost more. some cost less. each respondent saw ten questions. each question they were given four choices. every choice had a cost in terms of what it did to the financing gap. three new options and one is to

keep it the same as it is now where you don't impact the financing gap at all, the choices just continue on. and so built into each feature was the revenue impact of that feature. and what this did is it put costs into the equation. if you want a benefit increase, it had to be paid for. if there was a benefit reduction, it closed the financing gap. and allowed for us to understand -- not just if people like a feature or not, but which overall package would impact on the financinging gap people preferred. this wasn't a wish list. this was what americans -- how americans prefer to solve the problem. and one thing we saw, if i can just get one -- is they do want to close the financing gap. and this was evident in the responses. that was evident in the package

they preferred the most. so this is the methodology used very often in the private sector. we've used it tons of times. don't think it's been applied in the public policy, or i'm not aware at all, but i think it really gave us new and important insights. with that i turn over the clicker. >> we are hoping jason furman will join us. is jason here yet? on his way, okay. i guess we can have questions until jason arrives. over there. just state your name because c-span is -- there is. the question is, where is it? who has the mike? we can't hear you. here it comes.

>> yeah, for each question identify the organization. >> hello. i'm luke, i'm a humble tax reporter with tax analyst. >> a humble tax reporter, is that what you inside. >> there's three of us. anyway, i preface it that way because i'm not an expert about social security. but my understanding is that su surpluses of the program for a given year. invest in a trust fund. those tend to have a low yield. i know obviously the bush administration there was a plan to privatize social security and that was pretty controversial but was that something you covered in your survey or asked respondents about? it would seem to me having a slightly more normal economic return on funds would make the program solvent, right? >> elisa?

>> the options are endless 37 any one of the options we tested, for example, raising the -- gradually eliminating the tax gap, there are countless different ways to phase that in, to implement it and so forth. so by necessity we had to pick and choose which options to include. especially in the trade-off analysis, we selected only 12 of what we consider to be the most commonly proposed options for social security. so we did not test the options that would invest the trust fund money differently. that said, it's -- it would certainly be a great question to ask. >> yes. microphone over here, please. >> i'm hannah weinberger. i have a methodology question, which is how did you get people to pay attention to these detailed survey questions that -- i was looking in your

report. it looks like it took them 20 or 30 minutes to complete. it looks like people did. i'm just curious, you know, how did you get them to do that? how did you find all these people who were willing to slog through? >> thank you. it's great for my business, people still respond to survey questions. this was implemented online, which was -- okay, thank you. this was an online survey. people were part of a panel, research now, about 2 million people. they have a slight incentive to participate. it was about 20 minutes. we do a lot of surveys. you can get people's attention in 20 minutes. the good thing about an online panel is people can read the choices and really understand it. we find that useful. at any rate, there's a great deal of survey research still being done, still accurate fairly in predicting elections.

we'll see what happens this time. and we got the cooperation that was needed. i should say one thing, there's a quality control, so we saw how long -- we could measure how long people took to answer the questions. if they did it too quickly, we threw them out. for example, and if they just answered everything the same, someone agreed we threw them out. we called them straight-liners. we have quality control. a lot of surveys being done and the system still works. >> was there any overlap between this year's group of respondents and the last survey? >> no. each survey was a representative sample of the population, so we diplomat go back to the people we surveyed before. and that in some ways is by design because sometimes people learn in a survey. we didn't want to have people skewed or prejudiced in that way. new sample. >> it's funny. when people hear the findings of this survey, there's -- they can't believe. people said they would raise their own taxes? one person said to me, yeah, you

found -- the only 2,000 people in america, you found them two years ago and you went back to them again this time and those people aren't a real representative sample. obviously, from this methodology, it's completely accurate. i see jason has arrived. so, if jason, you're ready to go, let me just welcome you. thank you very much. jason, as i mentioned earlier, is the chair of the counsel of economic advisers, a member of the national academy of social security. probably has one of the toughest jobs in the united states up. don't look like you have it, though. you look like you're enjoying it. remember earlier i said there were very few issues on which there is bipartisan agreement, social security as we hear aone of them. i think it's fair to say, jason, whether you're a republican, democrat or independent, jason's reputation for objectivity, quality, is unquestioned. so, it's a pleasure to have you here to talk about the white house perspective on this issue. thanks, jason. >> thank you.

>> thank you very much for that introduction. thank you all for being here today. social security plays a critical role in our retirement system providing the basic foundation on which retirement security is built. but social security's not only about retirement. it provides disability and survivor's insurance, protecting all of us against the possibility that we will not be able to work or that an early death will leave our family with reduced means of support. and that's why i'm so grateful for nasi's continued work on all of the aspects of social insurance and how all of them fit together. your efforts have helped improve our understanding and the public's understanding of this critical program, helping ensure all americans have a secure and dignified retirement and protection against some of life's most important risks.

social security will convey direct benefits totaling $863 billion to 58 million americans in 2014. almost 90% of the population aged 65 and older receives benefits. those payments make up an average of 38% of income for people over age 65. social security provides greater benefits to the most vulnerable workers. it replaces a larger share of a work worker's previous earnings at lower earnings level. 14 million retirees would fall into poverty without social security. without social security benefits, the poverty rate for americans age 65 would increase from less than 10% to over 40%. as retirees draw down their savings and stop working completely at older ages, social security becomes even more

important as a source of income. for the most elderly, social security is the primary source of income. for over half of married and nearly three-quarters of unmarried beneficiaries. social benefits are particularly important to women. in 2010 more than half of women over age 65 had no retirement savings in 401(k) accounts. women's lower retirement savings and longer life expectancies can translate into greater hardship in old age. that is why features of social security including spousal benefits, survivor's benefits, the progressive benefit formula, and the guaranteed lifelong benefit indexed to the cost of living are all so important for women who account for 67% of the most elderly beneficiaries. many of these features also make social security benefits particularly important for african-american and hispanic households.

whi whitehouseholds have six times the savings of african-american families. in fact, only 27% of hispanics and 40% of african-americans age 21 to 63 participated in an employment-based retirement plan in 2012 compared to about half of whites. as such, there is considerable disparity in reliance on social security by different groups. for elderly beneficiaries, social security accounts for 90% of income, for 35% of whites. 42% of asian americans. 49% of african-americans. and 55% of hispanics. as you know, social security is more than just a retirement program. it is also an insurance program that covers the vast majority of

american workers. almost all workers in paid employment and self-employment are covered. all retirees make up 70% of beneficiaries. disabled workers and survivors of deceased workers make up the other 30%. roughly 95% of the population age 20 to 49 has survivorship protection for their families and 90% has disability protection. these protections are provided at a relatively low administrative cost and without the adverse selection premium that you might otherwise have to pay. social security will continue to grow in importance in the future as workers now bear more of the financial risk associated with their workplace retirement benefits. in 1981 roughly 60% of active participants in private pension plans were in defined benefit plans. by 2011 this number had fallen

to 18%. instead, employers have switched to offering defined contribution plans which provide what workers have saved plus whatever their investment gains have accrued. these plans provide a really important opportunity for americans to accumulate wealth and are an important part of the retirement system. but not all americans have access, even to defined contribution plans. in fact, currently over half of the workforce has no private pension plan at all. moreover, for those that do have retirement savings, few people actually roll over their savings into annuities, especially annuities with the type of built-in cost of living adjustments provided by social security. part of the answer to these challenges is to strengthen the ability of americans to save for their own retirement and to aknew advertise those savings. in 2009 the treasury expanded the ability of companies to

establish opt-out systems for retirement savings that are a proven way to increase takeout for 401(k) plans. earlier this year the president directed treasury to establish my ra accounts that would provide an easy and safe way to introduce more americans to retirement savings and we're pushing for legislation to make workplace savings plans available to all workers who do not have them today. legislation modeled on an idea developed by the heritage foundation and the brookings institute. ultimately, however, there's no substitute for social security's guaranteed benefit. and that's why it's so important to work together to protect and strengthen social security addressing the solvency challenge it faces as well as protecting the beneficiaries that rely on it. as the president said in his 2011 state of the union address,

quote, we should also find a bipartisan solution to strengthen social security for future generations. we must do it without putting at risk current retirees, the most vulnerable, or people with disabilities, without slashing benefits for future generations, and without subjecting americans' guaranteed retirement income to the whims of the stock market. thank you. [ applause ] >> jason is kind enough to stay for a couple questions and if i can take the temporary chair's prerogative and ask you the first one. the survey finds across the board support, particularly politically, republican, democrat, independent, for expanding social security so it provides a more generous benefit, especially for the lowest income. there are about a handful of bills i understand that have already been introduced in the senate and the house to do this. what are the prospects that the president might get behind

efforts to do this as well? >> you know, as i said and as the president has made clear, i thinks this is something we need to deal with on a bipartisan basis, and you need to deal with the solvency of social security, but you certainly in the process of doing that want to look at key areas, for example elderly women living alone have disproportionately high poverty rates and that's something that one could address in the context of social security reform. things like the minimum benefit have become essentially outdated. that's another type of thing that you could look at in the context of social security reform. as he said many times, it should be a bipartisan conversation. that conversation should recognize, you know, all of the important things about social security that i described, should address its solvency but should also try to strengthen and improve on the system that we have today. >> questions?

none other? there was one. >> hi. nice seeing you again, jason. so the other broad area of agreement in the survey was increasing the fi ka tca taxes think for the program to increase its solvency in the long term. i'm guessing you don't want to announce that today. if you do, feel free, but do you think there's any bipartisan appetite for that? >> i don't want to speculate about what there's appetite for. what's important is this program has a bipartisan history, it's important across the political spectrum, and that we work together to strengthen it. >> any other questions for jason? okay. >> nothing from you, maya? >> he's inviting. very good. again, identify yourself and

then -- >> maya macguineas. that previous question made me think about that. we found the results of this were bipartisan. it sounds like there's bipartisan support for lifting the payroll tax rate. is that something that the president would be willing to do even though it would come in conflict with the pledge not to raise taxes under $250,000 a year? >> again -- >> if there were bipartisan support. >> this is something we'd want to work on a bipartisan manner to do and certainly he's said in the past that when you're dealing with social security, he said on a number of occasions, that bringing in additional revenue from high-income households is something he thinks has a lot of support and would be consistent with strengthening the program and its important features. >> one more, virginia. >> thank you. is this on? jason, a slightly different question which is not so much what would the president do or what are policymakers going to

do in the near term, but what we found in the survey is quite widespread support among the general population for strengthening social security and raising taxes if that's what it takes to keep it strong for the long term. do you have any kind of personal speculation on how that would -- the disconnect between what we're hearing from the general public and the conversation we're having in washington? >> i'm not an expert in public opinion, but i can tell you that social security is just a very important program and it's very important to a lot of people, and people understand that and understand that there are ways in which you can improve on and strengthen it, and they also understand that part of that is making sure that it remains there for future generations by addressing its solvency. >> okay. if there are no more questions, jason, once again, thank you very much. [ applause ]

>> and let me thank lisa and mathew for presenting the survey finding. we'll ask our panelists to come up and begin to provide us comments on the survey. i think we have more name cards. now, to moderate this panel discussion about the study

findin findings, we have mark, who has been very involved in writing about retirement. mark miller has a column he writes on retirement. he also covers the issue for reuters and has probably been looking at this issue as much as anyone else in the past few years. his bio you can read about in your material, but i think when you look at his writings, they're strikingly pragmatic. he looks at these issues from a what does it mean to me perspective, what should i be doing about it with the whied that everybody really has to take a role in planning for their own retirement and position different income sources appropriately. mark will moderate this and then introduce the other panelists. mark, i will turn it over to you. >> thanks, bill. and good morning to everyone. and a special welcome to everybody who is watching on c-span and live on the internet.

welcome to you as well. hope you'll stick around. i know we're going to have a very interesting and provocative panel discussion. we have about an hour for the panel, which is going to give us time for some questions at the end, and before we get started the academy staff has asked me to remind you about those blue evaluation forms in the packets. we really hope you will take a minute to fill those out as it helps us with planning future events. as bill mentioned, as a journalist covering retirement and ageing, i devote a lot of coverage to social security, spend a lot of time on it. i think along with coverage of health care, there's no more important element of retirement security as a topic for average americans, and this -- i was reminded of this recent ri earlier this month when the census bureau released its latest numbers on poverty and, no surprise to anybody who studies social security, it indicated that 53% of americans would be living below the poverty line if not for social security compared with roughly

15% today. so that's a fairly dramatic figure, i think. and as noted earlier, the benefits that are provided are not rich. next year the average benefit will be just a few thousand dollars over the poverty line, just under $16,000 a year. so when it comes to the future of social security, i think this survey that we've heard about this morning does show a clear public consensus on solutions across all these different dimensions, political parties, age groups, income groups. people do want social security to do more and not less, and they seem to be willing to pay for it, which is remarkable to me in light of the general distrust of government we see today and lack of agreement about just about anything else in society. and yet at the same time we see these concerns about the future of the program. so there's a lot of meat in the study i think. so that said, let's get to the thoughts of our panelists. all of them are members of the academy. i'm going to introduce them to

you in alphabetical order, and you will find more detailed biographies of each of them in your packet. andrea campbell teaches political science at m.i.t. she's a pre-eminent expert on social insurance, taxes, and public opinion about them, both in the u.s. and abroad. she's author of a new book called "trapped in america's safety net: one family's struggle" i'm sure now available on amazon or wherever else you like to shop that uses her own family's experience to explore how means tested programs actually work on the ground. maya mcginness is the president for the committee for a responsible federal budget and an expert on budget, tax, and economic policy. once dubbed an anti-deficit warrior by "the wall street journal," she regularly testifies before congress and publishes in national media outlets. v virginia reno is the vice president for security policy at the academy. she directs the work on

disability insurance, worker's compensation, unemployment insurance, and related issues. she has authored many of the academy's briefs and reports and directed its landmark studies on proposals to partially private advertise social security and on promoting rehabilitation and employment of persons with disabilities. and mya rockymore is the president and ceo of global policy solutions. she also co-chaired the commission to modernize social security which developed a reform plan that would make social security fully solvent for more than 75 years while also strengthening benefits for vulnerable groups. she has held leadership positions at the congressional black caucus foundation, the national urban league, the office of congressman charles rangel, and on the staff of the house ways and means committee. she serves on the academy's board and also chairs the board of the national committee to preserve social security and medicare. our procedure and format is fairly straightforward.

each panelist will comment on the study for a few minutes and then we'll have a moderated conversation before inviting some questions from the audience. let's turn first to andrea campbell. and andrea, feel free to stay there or come up as you'd like. if you stay there, please press the button and turn on the microphone. when you get the bright green light it's on. >> now it's bright green. i want to make two general points, one is to talk a little bit about social security in the context of other welfare state programs that we have in the u.s. and also the u.s. versus other countries. and then talk a little bit about what the public might support and what the survey tells us about that. there was a lot of commentary that reached a fever pitch during the great recession about the cost of the major entitlement programs, implications for the fiscal future and the need to trim them back was the predominant theme of that conversation. leaving aside the question of medicare for a moment, social

security is in pretty good shape, not that you would necessarily know that from the national conversation, but it's actuarially predictable. the long-term gap is solvable in a number of ways. and i would argue that not only are there strong arguments for preserving the social security program as it exists today, but also some very strong arguments for enhancing benefits, especially at the low end of the income spectrum and particularly when we look at what social security does for our senior citizens compared to what happens in other countries. it is our most effective anti-poverty program. you heard the statistics cited this morning. it also provides a safety net for entire families as we saw during the great recession when unemployed and underemployed adult children moved back into the homes of their senior citizen parents. it's certainly a far more effective anti-poverty program than our array of social assistance or means tested programs which are variously wait listed such as tanit f or

housing assistance or child care assistance or which don't reach as many people as they could, take food stamps. only two-thirds of eligible people are enrolled in food stamps compared to almost everyone who is eligible for social security being enrolled. medicaid recipients have difficulty accessing doctors because reimbursement levels are very low. ssi, supplemental security income cash payments to our poor elderly blind and disabled citizens provide payments that are below the poverty level. i detail all these shortcomings in the book "trapped in america's safety net" which mark was kind enough to mention, and i should say that social security as a social insurance program rather than a social assistance program does a better job than all of these means tested programs. in terms of alleviating poverty. but there are a number of reasons for concern around social security. despite the fact it's the most expansive social policy that we have in the u.s., it has some

significant shortcomings. the senior citizen poverty rate in the u.s. is half the child poverty rate, however, it's higher in the u.s. than the senior poverty rate in our peer nations, in other rich democracies. the replacement rates for social security, the percentage of people's earn -- working age incomes that social security replaces is lower than in many of our peer nations. the minimum benefit has become inadequate over time. many seniors with weak work histories live in poverty, especially as cited, older women, older minorities, and the old old whose other sources of income have often times become exhausted later on in retirement. and the other thing worth note something effective social security benefits are falling in the sense that medicare cost sharing is going up. so if you look at the premiums, deductibles and co-insurance that senior citizens pay for doctors visits and prescription

drugs, that consumes a growing share of the average social security check. it was 10% back in 1990. now it's about 29%. it's projected to grow to almost half in 2040 unless we make changes. so social security is an incredibly effective program, but there are arguments it needs to be strengthened in a number of ways. so the question is, is the public support there and that's where we can take a look at this survey. so we know that large majorities say that social security benefits do not provide enough income for seniors as lisa pointed out, that we should raise future retirement benefits, that we need to preserve social security. if you look in other polls that compare support for social security to other government programs, social security usually comes out as number one. it's very popular. is there a willingness to pay for preserved or enhanced benefits over time? past poll questions have often times asked about social security in isolation. you know, do you want funding to be increased, decreased, or kept the same.

usually there's very high support but again those questions are asked in isolation. when we ask questions such as, should social security funding be increased versus reducing taxes? or addressing the budget deficit? usually social security wins out. thereto can be questions that ask, how would we -- how would we want to go about enhancing social security funding? often times in these questions, and i'm referring to questions by pew and gallup and other houses over time, the most popular answers are increase taxes on the of a fly went. many ordinary people are unwilling to fund social security themselves. so i think that's where this survey comes in. the beauty of the trade-off analysis is that we can assess what the most attractive package is and what's interesting about the preferred package is that it includes not just contributions from high earners lifting the wage cap, but also increasing the payroll tax for all earners. so it makes us more certain that people are willing to put their

money where their mouth is when it comes to supporting social security. what's also interesting is that the percentage of people supporting increased taxes just on top earners by lifting the wage cap versus increasing the payroll tax on all americans, that gap is only 6%. these very, very small. and you also have large majorities of income groups -- of all income groups agreeing with this. so there's a lot of consensus here here. the preferred package in this trade-off analysis pairs these revenue enhancements with benefit enhancements that are progressive in nature. raising the cola for seniors to reflect a particular kind of inflation they confront. but also raising the minimum benefit above the poverty line. so it's pretty clear from this analysis that people want these kinds of progressive reforms and robust funding. so i'll just end by saying what about cleavages by age, by income, by party identification which we see in other opinion

areas? there was this whole cottage industry of political scientists and sociologists during the 1980s that talked about looming generational conflict. i have never seen any evidence for this in survey data, and you don't see this looming generational conflict in these data either. there are 12 points that separate americans born after 1980 from older americans in terms of overall support for the program, but i think the real take home point is that you have -- even though there's a gap there, it's large majorities of younger people are supportive of the program. 80% of people in generation "y" or whatever we call them say social security benefits are now more important than ever. 77% say they don't mind paying social security taxes. 69% say we should increasing social security benefits. you might have a gap by age, but you have very strong majorities even in the most, you know, quote, unquote, skeptical age group supporting social security. income. so we might imagine a rift between lower and higher earners

in recommended changes for social security especially for higher earners who pay more in but ultimately get a lower replacement rate and who are less dependent on the program for income. are those higher earners less supportive of the program as a result? not so much. again, we have large majorities of even higher earners supporting social security in general, the taxes, and the possibility of raising benefits. and then finally party i.d. you know, we have such a polarized era on many opinion objects, democrats and republicans are wide apart. take the aca, the gulf between democrats and republicans in terms of support is 50 points. that gap is a lot smaller when we turn to social security. there are differences. there is a 20-point gap between republicans and democrats in favorability toward social security in this survey, but, again, republicans, the more skeptical group, are on the positive side of the 50% ledger.

59% of republican majority are favorable toward social security. there is a 15% gap between democrats and republicans in the percent saying they don't mind paying social security taxes, but, again, it's a republican supermajority. 72% saying they don't mind paying those taxes. and a 15-point difference, too, about whether we should consider raising social security benefits but republicans are at 65% in terms of raising support for those benefits. i will say in closing that social security is a crucial support. it's one that could provide more gre comprehensive protections. the public support is there. we might worry on survey that is people engage in cheap talk and that support would evaporate when changes are actually on the table, but the trade-off analysis can make us more certain than these opinions are real and, you know, we need lawmakers who are willing to put the proposals on the table because as you know the sooner we make changes, the less severe

they have to be. >> on this point of intergenerational conflict i have always watched with some bemusement when we try to gin these stories up. there's no evidence to signature it exists. i think one of the key reasons is we don't live in age segregated silos. we live in families. so young people have parents or grandparents who are on medicare or social security and they understand the meaning of it and what the importance of it for that reason. so i just -- i marvel we keep writing these stories and trying to make it out as though this exists when there's no basis for it. maya mcginness, why don't you go next. >> okay. thank you very much. thank you for hosting this event today. it's a really, really interesting and important study. i'll too start with kind of talking about how important social security is to the overall country, economy, budget. clearly, it does so much to lift millions of people out of poverty. it is more than just a retirement program in that it helps with disability, it helps

with dependents, plays a very critical role. i think one of the most important things about it and jason alluded to it is it's an annuity form. it protects people against outliving their retirement benefits and we don't really have that in other areas of our retirement. really, really important. it's also the federal budget's largest program, so while it is separate from the rest of the budget and has kind of a unique separate status, it has a big effect on the rest of the budget. the survey, i think this is going to end up being kind of a singing the praises of trade-off analysis because i think the survey is really important. one, it focuses on the right questions. it focuses on how we would fix social security giving you lots of different choices, and the trade-offs is what budgeting and fixing these programs is all about. i particularly think about in political season when social security is kind of the issue that people run the most negative ads on and try to scare monger the most, and you can manage you have one candidate saying, okay, well, i would fix

social security by lifting the cap, raising the age, changing the c.o.l.a., whatever it is, getting to a plan that would be fixed, and then you have the other candidate saying, best program ever, i wouldn't touch it, and that's the person who usually gets the political points because if you don't have trade-off analysis, if you don't have people saying, how would you actually fix it, there is no free lunch, you can't have an honest discussion. setting it up the way it did here is really important. in terms of the specific things that we learned from this survey, really interesting stuff there. one of the things i think is most important is that it gets to full solvency, a plan that people are willing to support. it's not just a partial fix. there is support for enough changes to fully fix the program. another piece of it that i'm personally very supportive of is enhancing the minimum benefit. there are a lot of things that make this program outdated where people who have been working a full lifetime aren't living above the poverty line and along with fixes to ensure the solvency of the program, we can

really focus on strengthening the program. jason also mentioned another area i think is really important but the highest level of poverty is for senior women over 85, kind of the old old, and we can look at things that would bump up benefits for the very old that would also help to strengthen the program. and the other thing that i would just very impressed with, i guess the american people, but that people were talking about being willing to lift the payroll tax rate because so often what we hear about in budget discussions right now and specifically again on this polarized environment is would you tax somebody else? would you cut somebody else's benefits? and this is people saying we are so committed to the program that we are willing to put more money into the program to support it. i think that's around incredibly important finding. the piece, and again this is sort of my -- what i think about the results, what kind of plan i would or wouldn't like. the piece i'm least comfortable with and this isn't discussed directly in it but it would be an effect of if you put that whole plan into place would be

that it would end up increasing the benefits for the well off by an awful lot. so if you were to put this plan into place, the overall increase in benefits from the additional money put in would be for low income people about $150,000 in lifetime benefit increases. for medium term people it would be about $14,000 but for the well off it would be $1.5 million in additional lifetime benefits. that's for somebody making $1 million a year while they're working and contributing to the plan. so in my mind sort of having the well off make ten times as much as low income workers or 100 times as much as middle income workers isn't at all clearly the best use of resources. that's the kind of thing i would rethink in it. the other piece i want to put into perspective because i think broadening out the discussion and not compartmentmentalizing it is really important is the amount of revenues it would take to fix the system if you did it

all on the revenue side while expanding benefits. this plan would be about an addition of $4 trillion in revenues and just to put that in perspective, again, it's kind of the trade-off piece of it, but with that same amount of money, what you could also do is you could get rid of the sequester, the budgetary sequester which is right now hitting a lot of parts of the budget that are underfunded i would argue. you could fully fund highway trust -- these are and. could you do all of these. fully fund the highway trust fund program. you could have another war in iraq which i'm not say something what we should do but in terms of perspective of another $800 billion that you could have for resources for something else. and you could increase funding -- you could double the funding for low income education, social services, the eitc, job training. so it's just a question of -- and i think this is a question that comes up a lot in budgeting is what is the best use of new resources? and i think the question clearly here that we've seen or the answer that we've seen is social security is incredibly popular

and, again, people are willing to put their own money, not just somebody else's money, their own money into it. thats shows a level of support. one thought i had was we should take the trade-off analysis and expand it to the whole bulth. i don't think which should fix social security as part of the whole budget. i think it's better done separately but i think it's important to think about less compartmentalized approaches to budgeting because we have unmet needs in health care. we know health care costs are growing too fast. we have under invested. we have a huge fiscal gap. we have to figure out how to make social security solvent. so i think doing trade-off analysis, this is the next project that you can work on, but to all these parts of the budget would be very interesting to see what would come out of that. so just my final thoughts, i'll say i think the issue of saving and retirement critically important. everything we're seeing is that the next generations are not preparing well enough for retirement at all. we have to fix social security. i also think we have to look at

other things. increasing individual savings is clearly an objective we should be thinking about. we need to revamp our retirement system because we are not headed in a good direction. second, as i kind of mentioned, i think thinking about the big picture is really important because budgeting is about trade-offs, and this has opened up a great discussion on doing that. thirdly, as i kind of talked about in terms of what this particular plan would do to increasing benefits for the well off, my belief is there are better ways to target these addition yam benefits. i think targeting of limited resources is really critical. how you do it, how you create the right incentives. and finally, again, kudos for doing this. the bottom line is nobody is going to get their first choice for how we fix social security but we've got to fix social security and as was just mentioned, the longer we delay, the worse those choices become. it's great to start a real discussion on what the trade-offs are and how we should get to the business of fixing the system. thank you. >> thanks, maya.

virginia? >> okay. how do we -- i have a handful of overheads. how do i get to the number one? thank you. i want to thank you, maya, by the way. i want to comment on the survey findings more from a historical perspective and also i'd like to respond to a couple of the questions and comments that maya raised. first, if you take a very -- a long-term commitment view of the program, yes, workers pay for it, but they expect something in return, and i think in the public mind the pay for and the future benefits are very closely connected in one sense. also, social security, both its

benefits and its revenues, are specified in detail in the law. so this is something that has to be addressed by lawmakers if the system is out of balance. and as we think about so what kind of questions do lawmakers need to consider? and i would pose some very basic ones though they're the same kinds of questions that we ask the american people. are the benefits and the law adequate? are the taxes needed to pay for them both affordable and do they do the job? and then what kind of a balance between these two concerns is fair? keeping in mind that the people who pay for the program at one point in time are later people who will be benefiting from the program at another point in time. on the question of affordability, i think this is critically important. we hear that many entitlements are raging out of control. well, social security is not among them.

if we look at the affordability question and look at the benefits scheduled in the current law, though they're not fully financed, they are very close to a flat line. it's about 6% of gdp -- excuse me, 5% now rising to 6% and then flattening out between 6.2%, 6.0% for the rest of the next 75 years. so clearly the affordability issue for the benefit currently in the law is, at least i would argue, is not a major concern. they're not fully financed. that is an issue. part of the reason why social security going out into the future is essentially a flat line is that current and future benefits are gradually being scaled back by much more than most of us realize or are talking about. back in 1983 the last major social security reform, several important changes were put in

place, but they were put in place to lower benefits and do it very, very gradually over time. the first such change was to raise the retirement age from 65 to 67. that's happening now, but it's happening very slowly. when that -- and as i think most people realize, that's equivalent to an across the board benefit cut for retirees. it's about 6.6% for each year that the age goes up, so it's 13.5% roughly by raising the age for two years. by 2050 retirees younger than 90 will have been affected by this retirement age. that keeps benefit costs under the current system much lower than they otherwise would have been. the second major change that began in 1983 and is phasing in very, very gradually is subjecting part of social security benefits to income taxes. that was done in 1983 with the

revenues going back to the social security trust fund to help finance benefits. so in that sense it's also a financing mechanism but it's a reduction in net take home benefits for beneficiaries. in 1993 congress took another step and had put -- subjected a bit more of benefits to income taxes and allocated that to the hospital insurance program. so that is about 8% to 9% of social security outlays that are coming back to social security and medicare meaning a net reduction in benefits. it does affect the higher income beneficiaries because it follows income tax rules. and the last long-term change is quite small, but it's part of the package that lowers future out go and that is delaying the cost of living adjustment by half a year. and that continues ad infinitum and that's about a 1 or 2 percentage point in future out

go because the cost of living adjustment is soon to be between 2%, 3%, or 4%. but these are the lasting impact of the 1983 amendments that we haven't seen the full effect of yet particularly the retirement age and the taxation of benefits. so what did lawmakers do back in 1983? well, when the greenspan met -- greenspan commission met in 1983, their primary concern was eliminating the social security financing gap of the 1980s. it was running out of money. it was running out of money just months after the legislation was finally signed. it did not come up with a recommendation for the long term. it did come up with two options. one option was to raise the retirement age. the second option was to schedule a tax increase out in the future when the funds would be needed to keep the system in balance, and both of those

options were to address the demographic challenge of the 21st century. well, when it got to the congress, the congress had to act. the lawmakers chose only the retirement age increase, and one of the lawmakers actually is quoted -- is recorded as having said, there's a reason for this. if we're going to raise the age, we have to give workers ample notice, but we don't need to give long notice to raise the tax. we can do that when we need to do it. well, it's kind of interesting that this survey seems to suggest that the american people are suggesting maybe now is the time. americans are willing to pay for social security, and it sounds like this might be the time to do it. i'd like to comment on maya's two points about the lifting the cap. the option that we included in

the package does not provide -- continue that 15% bracket all the way up. it's 5 and it actually scales back to less than that at a higher level. and it was specifically designed not to pay extraordinary benefits to millionaires. so it's designed not to do that. i'll stop there but look forward to the discussion. >> thanks, virginia. and last we'll hear from maya. >> thank you. i'd like to thank the national academy of social insurance for producing a very importance report. americans have made the hard choice on social security, and that hard choice is to say with a resounding yes, we support social security. we continue to see its importance. social security is one of america's pillars of progress. we created it because there was market failure.

prior to the creation of social security, there were no options for people who were modest or low income who worked all of their lives and then retired or had no ability to continue to receive support in retirement. and so many of those people actually ended up in poor hou s houses, dependent on their family and in utter destitute poverty and we decided as americans we can do better than that, we are better than that. when we work together, we achieve tremendous benefits and the creation of social security was one of the pillars of progress that we decided that we were going to come together to create in the 20th century. medicare was another one. market failure created the situation where seniors who had worked -- many of whom had worked all of their hard working lives, more than 50% were unable

to get health insurance on the private market prior to the creation of medicare. so we decided as americans we were going to join together again to create a solution to form another pillar of progress, and that was called medicare. and so here we are despite all of the rhetoric and all of the arguments we have heard over the past some odd decades but certainly intensified over the last decade. you know, well, we can't afford social security. we can't afford these programs. we can't afford entitlements. these programs are -- i mean, certainly i mean just the ultimate in disrespect to the american people is to suggest that thighs are unearned benefits. people know that they pay for it. and people know that they are deserving of it. and so to actually label these programs as entitlements as if it's a welfare program is a slap

certainly to the hard work ethic of the american people and is certainly a slap to the history of making sure that we actually invest in our social insurance programs. and so with that virginia actually mentioned the demographic challenge of the 21st century in the context of the reforms of 1983, and at that time they were framing that demographic challenge as one of the retirement of the baby boom generation. that we were going to cut benefits, and they did, you know, by increasing the retirement age, they actually cut benefits and allowed the social security trust funds to actually grow so that they could prepare in advance for the projected demographic shifts with regards to the expected retirement of the baby boom generation. so we came together then on a bipartisan basis to do the right thing. you know, to prefund the program so that we could make sure that we were taking care of the future demographics.

well, i am here today to suggest that we need to do the same thing before another demographic challenge of the 21st century. what do i mean by that? many people have focused on the graying of america, but very few people have focused on the browning of america. and this is why the projected increase of the racial and ethnic demographic population of the united states of america is incredibly important for this conversation. today out of all babies born in the united states, a majority are babies of color. by the year 2019 the census bureau projects that of children under the age of 18, a majority will be children of color. and then the census bureau projects that by the year 2043, a majority of the entire nation's population will be of color. now, why is this critically important to social security? well, actually when you look at the socioeconomic status of these populations, you can understand why social insurance continues, especially social security, continues to be a very

important pillar of progress that we not only need to preserve but to strengthen for the future. when you're looking at -- there is a racial income gap. if you look at the median earnings of whites compared to african-americans and latinos, you see a stark difference. with african-american and latinos earning significantly less than whites. when you look at the racial income gap in terms of -- excuse me, racial wealth gap in terms of not just income but also in terms of assets owned by these populations, for every dollar of wealth held by the typical white family, the typical african-american family owns 6 cents and the typical latino family only owns 7 cents. so these are populations, the very populations that are expected to grow in the future are the very ones who remain at the margins and at the very bottom of the u.s. economy and

economic ladder. and so that means that social security will be as important, if not more so, for the rising demographic in terms of race and ethnicity as it is for today's population. that means that we need to be fundamentally thinking about strengthening social security from a different perspective, not from, oh, well, you know, we've been hearing over the last maybe five years or so, we need to cut benefits so that we can preserve social security. well, cutting benefits basically takes the rug out from under the very people who are going to need it the most in the future. and we've been hearing arguments like, oh, well, you know, one of the most important benefits that we need to cut is raising the retirement age. well, guess what? and then people make disingenuous arguments like, oh, well we need to raise the retirement age because we're all living longer. that's a fabrication. the upper half of the economic

distribution is living longer. the bottom half, their life expectancies have stagnated and in some groups it's even actually reversed. for white women who without a high school degree in poverty, the life expectancy has actually declined by five years. and this is in the wealthiest nation in the world, the united states of america where we have declining life expectancies amongst certain populations. so we've been talking broadly about inequality in america on a broad scale, and social security is an important part of this inequality conversation and social insurance in general. you know, that we need to actually be looking at equitable solutions that take a look at the whole picture to figure out how we actually right this ship and bring equity and opportunity for all americans for future generations.

and so with regards to that with the african-americans, latinos, other people of color, they have a higher reliance and jason already shared with you the statistics, that these populations because they don't have wealth, because they're a lower income, they have a heavier reliance on social security. and they're reliant on the entire program, not just the retirement benefits. so many people don't know that approximately 38% of all social security benefits go to disability and survivor benefits, but when you look at, for example, the african-american population, almost half rely on social security for disability or dependent care -- or, excuse me, the survivor benefit program. and so you know that the entire program is important for these populations, and we need to keep that in mind when we're looking at solvency for the entire

program. so i'd just like to end by saying that we are in a representative democracy. i'm a political scientist. you know, this is actually a republic, but we are supposed to be representative and our elected official it's as are su to be representative of people. what the national academy has been able to do as part of this important study, has been able to actually shine a spotlight on what americans want and what they're willing to pay for. and guess what? they are affirmingly and resoundingly saying, we want social security and we're willing to pay for it. and so with that, i encourage all policymakers in washington to listen to your constituents. thank you. [ applause ] >> thank you, maya, and thanks to the rest of the panelists. we'll do a few questions here

from the podium and then we'll open it up to the floor. and first question, andrea, we'll start with you as a political scientist and then i'd be interested in other panelists' thoughts on this. the study is clearly showing this broad preference across the spectrum of politics to address social security's long-term financing problems with contributing more rather than cutting benefits in any way, and that stands, i think, in fairly stark contrast to the discussion here in washington where the conventional wisdom for quite some time now has been that we'll never have bipartisan agreement on this issue unless we make some kinds of cuts. so an example of that would be kind of the dalliance with the notion of a changed cpi which is a benefit cut. so my question starting with you, andrea, is what do you think it would take to bridge the gap between these two viewpoints, the public and the washington view?

>> that's a good question. lawmakers listening to constituents as has been urged. it is interesting that when you look at these public opinion polls, that when polls ask about simply the policy question without labeling the proposal -- the proposed changes as republican or democrat, in other words not giving members of the public these political cues, then you see among the public incredible conscientious across all political groups. it's only when you start labeling things as this is the proposal from congressional republicans or from president obama that when people get that political cue they think, oh, that's the other team's proposal, therefore, i must oppose it. so, you know, the problem now is that we have such a disconnect between our political elites who are only thinking in these very partisan terms and the ordinary public who for the most part don't, especially when it comes to a program where the mechanism

is as clear as social security. i don't know what it's going to take. interesting, there's been a few instances where even lawmakers realize they have to go with their constituents and not with their party's preferences. if you think back to george w. bush's push for social security privatization in his second term, it was congressional republicans who came back to him and said, just don't go there. my senior constituents don't want to go in that direction. so on occasion there is i think more responsiveness to the public, but, you know, i don't know the real ingredients to get that to work more consist ientc. >> maya mcginness, do you think it would be possible to do social security reform without cuts of any kind. >> i was thinking about what is actually possible right now. do i think it would be -- do i think there could be a revenue only plan? well, i think the first step is loumakers actually get a whole lot of different signals on this. this is a really important

study. there are also a lot of other polls out there that have very different results in terms of what it is that people want when they're reforming social security. so there's one i'm familiar with from the voices of people -- microphone, sorry. there's one study out there, one poll out that also says there's majority support, high majority support for cutting benefits for the top quarter of people and that there is support for raising the retire am age for another year. we have a very not scientific poll but we have a social security simulator where people can go on the website and play around and come up with how they would fix the system and raising the retirement age there is one of the most popular things that comes up. now, these are people who would come to a fiscal watch dog website and play a social security simulator, so i would dismiss our findings as anything but scientific. but i do think one of the things is that lawmakers, one, get a whole lot of different information. so what this does to me, it says let's study this more. again, i would like to put the social security reforms next to an overall budgetary situation

so we think about this is a country with so many resources. if you lift the payroll tax cap like we're talking about in this proposal, the top rate would be 59% for high income people. that's higher than most people -- that's looking at income tacks with payroll taxes. that's higher than most people say they support. i think if you do more studying and we come up with more solutions, i think that makes it more likely lawmakers will listen. but there's a flip side of this which is i haven't seen a single issue that has the ability to generate more negative political ads and that's anybody talking about anything. so we also have to find a way to completely depoliticize or bring down the rhetoric and bring up the truth telling in terms of there are choices, they're hard choices. which ones are people willing to make in order to fix social security. the third thing is i think we're going to have to do something soon, maybe not in the overall social security system, though we should, but disability is going to be running out of reserves by 2016. so there's about to be kind of a

forcing moment where we're going to have to figure out how to deal with disability. most people would say that ideally you would do that as part of a comprehensive fix to social security and disability at the same time. i'm not as optimistic as i would like to be that that's how we'll go at it, but at least we'll be talking about disability soon and that will open up this whole discussion. when it comes to revenues versus spending cuts, i think that's the single biggest fighting point that there is on budget politics overall and social security. i think there's more willingness to lift revenues for social security than there are for other parts of the budget but this is the one where everybody goes into their camps and dunn want to budge and we're going to have to compromise and look at what can pass both parties. >> how do you see this pending discussion about disability insurance reform in the broader context of social security reform that the other maya just mentioned.

>> it's happened before where the disability trust fund has experienced a challenge with solvency and we solved it before by reconfiguring how we reallocate the monies across the trust funds. it's been simple before, and it's still simple. we've done it before, and we'll do it again. >> another question i wanted to ask is, maya macguineas, have to keep my mayas straight here. you've written elsewhere, didn't come up so much today, about the idea of means testing as part of social security reform, and i wanted to ask you if you could talk more about exactly how that would work. would means testing social security in your view be a wealth test or an income test of some kind? and what's the justification for it given the notion that social security -- not the notion, the reality that social security is an earned benefit, not a welfare program. >> okay. so means testing, one, i would say that it is, of course, an earned benefit.

we contribute to it, but part of the reason there are problems in social security is for so long people got more out of social security than they put into it and i'm completely comfortable saying social security functions as a program where not everybody is going to be able to get everything they put into it out of it otherwise it doesn't work where you can subsidize people who are low income who live very long. you want to make sure social security is there to protect people who need it, who depend on it, and live for a very long time. means testing to me is such an interesting option. first off, when i don't bring it up at town hall meetings and other places, it's the one that gets brought up the most by people when i talk to them. that seems to be the most popular one when i talk to people outside of washington. it didn't come up here today. but what confuses me about means testing is, again, it's an area that seems to go to this partisan divide where you have generally, zwrous generalize, many people on the left don't like the idea of means testing because what they think it would do, and virginia or anybody else can sort of correct me if i'm not representing this well, it would undermine support for the

system. so if everybody is not getting a lot of what they put into the program out or real return on their contributions, they wouldn't support the system as much as they do right now. and so there's a resistance from people who are on the left and progressive often times to means testing or making the system more progressive because they worry it would undermine support. is that a fair representation? >> that is sometimes said, yes, that it undermines the support. but i think on the question of progressi progressivity, i agree with your point that it makes sense for the system to be progressive. it also makes sense that not everybody is going to get back exactly what they put in or more. but if we want progressivity then in a clear way one can look is on the revenue side and let everybody pay in all year long that 6.2%, and in terms of solvency that does a whole lot

more than trying to track down a few millionaires to make sure they don't get their social security benefits. so, you know, just as an effective progressivity, you get much more bang for the buck on you fete more bang for your buck on benefits than revenue. >> that makes one of my points. one of the interesting things is if your objective is to make the system more progressive which i would advocate for. i think one of the keys is to protect people who depend on the system while we figure out how to fix it. people on the left would prefer tax increases. people on the right prefer benefit cuts. at the end, if you're just taxing the same amount or reducing benefits by the same amount it's the same policy with the same distributional effect. it make as difference whether it's tackses or oh spending. i have been surprised more people don't like means testing. it makes sense to say as we lift the payroll tax cap you don't need to give new benefits for

people over a certain amount contributing to the program. it make mrs. sense to use the resourceses to plow them back into seeshl security or somewhere else. >> classic means testing -- >> when you asked how you would do it. the problem with means testing is it creates the wrong incentives. the best way to structure means testing is based on your lifetime earnings so it doesn't incentivize you not to save but says if you were working a lot for your whole life you get less benefits at the high end. something, but not as much at the top end. classics means testing is based on current need as opposed to what you described. . this is the issue of what you did over the course of your lifetime.

when i hear means testing i think something different. >> right. i was listening to this question of what it means for public support if it's for high earners and would that under mine support for the program or cross class solidarity. there is evidence that it does which is part of why people on the left are afraid of cutting benefits for high income people too much. the 83 amendments insbro deuced benefits for high income people. if you look at support for social security over time by income level the gap across income levels did widen after that change. the gaps were narrow before the

change and higher income people became less supported after the change, after the program became a worse deal for them compared to what it attained previously. there are legitimate concerns about means testing. by whatever means that's carried out. >> can i ask a question? >> i wonder if you reduced benefits other than taxed them if there would have been a different take. i wonder if that brought down popularity more than if lowering the replacement rate. >> introducing taxeses is much more visible. >> i wanted to alert the audience we'll go to your questions after. so if you are thinking of a question, get ready.

>> the notion of means testing, social security is a popular question i get on the washington cocktail circuit where high net worth people are in the room. with fwlasz of wind in hand, they will come up to me and say, we and my friends -- me or -- neither i nor my friends need social security. why don't we just means test the program so high income earners don't receive it. then we'll solve the issue. i come back and say, you know, this is social insurance. the concept of insurance is fundamental that you pay into a system of insurance so that when you experience the need i can get it. sometimes the need doesn't happen over a lifetime. but sometimes it happens.

what do you do if you don't have it. is anybody suggesting that high net worth people don't need to purchase homeowners insurance? they purchase it in case they experience a fire. let's take it back to the concept of social insurance. what's the fire that faces high net worth people in the context of social insurance. bernie madoff, enron. there are madoff millionaires who one day had a lot in the bank account and the next morning woke up destitute. many of them, unfortunately, were seniors. heaven forbid they had no alternative, nothing to rely on. the issue should be a moot point.

there is fairness up and down the income scale. we need to make sure the protection is there regardless of your net worth in case the fire comes. >> i have seen social security is important pretty high up. you hear warren buffett doesn't need social security, that's correct but that's distorted. how many are tr there? not many. they have spent down everything else. did you have a comment? >> i was thinking it was making the point that i thought means testing does. it needs to be a plan. if you don't need them and you are going to cocktail parties where people say, i don't need this and i want to give it back. it's not going to fix the

program. you have to make a lot of other changes. you have to bring revenues into the program. that seems like a good option. >> you can go to ssa and you cannot even apply for it. >> you're talking about a current need versus we were talking about the idea of means testing against the earnings of a lifetime. i think there is confusion around what we mean about means testing. >> there are many ways to structure a means test. you want to do it carefully and thoughtfully. >> let's open up questioning to the audience right here. please introduce yourself briefly. >> i'm phil gilliam here representing myself. my question is how many candidates in the upcoming

november election will mention this in campaign ads, campaign speeches. means such as that. >> we'd be glad for you to share it with as many as you can. >> there is a fair amount of it going on in key battleground states and peculiar thingses are going on. we are seeing attacks on democrats by republican super pacss from the left. accusing democrats of being weak supporters of social security because maybe at one point they said something nice about simpson bowles in the past. the ads will say, kay hagan wants to raise the retirement age because simpson bowles said we should do that. she once said, yeah, take a look at simpson bowles. there is a lot of distortion. no big surprise, going on in tv

advertising in the race this year. that's unfortunate. >> i don't think i have seen any ads of people talking about specifics of how they would fix the program which is the problem. >> i would like to add there begin to be more specific social security proposals that do come up with responsible cost estimates that include paying for the system. and some modest benefit improvements. >> and some candidates are trying to run on that. alaska is the best example. another question. do we have time for one last? >> a question for mya. >> wait for the microphone. >> which mya? >> specify your mya. >> i'm from social security workses. you say there is a scarcity of

resources and you support revenue as part of the solution. because of budget constraints there is a limit and so forth. at the same time you admit there is a retirement security crisis and say people need to save more. why do you think there is money for people to put more in the 401(k) but not to contribute payroll taxes to fund social security? wouldn't it be more equitable to have it go through the system rather than having wealthy people get a bigger tax deduction to contribute to 401(k) and iras? >> great question. the main constraint the political. we are not going to tax 100% of the economy. 90% p, 80%. i don't know where the limit is. what is the best use of resources given how many things are under funded. you have to look at social security, all the competing things.

i don't know which is more progressive. you could make a personal saving piece. not social security but private saves. you talked about tax breaks. . there were ideas i have had for some time. progressive savings like mandated savings of oh x percent. of your income. on the low income end of the scale you would receive government matcheses. i guess the question isn't just what the limit of how much people are willing to pay in taxes is. it's what things they would most want to give it to. if people are more encouraged to have ways to have savings than going into social security, that would be something you would get more revenues. if they prefer social security that's where it goes. it is a political limit of that people are willing to pay only so much in tacks. the more you pay it is detrimental to the economy.

>> i want to speak to a misunderstanding. people look at social security and medicare and say we are spebding all this on seniors. we need equitable spending on the low end of the life scale. it's important that you have babies on social security, teenagers, middle age adults on social security and seniors on social security. there is not a trade off. this is an important program across the life scale for all americans. we should not pit social security against pre-k for example. when i say that's a pillar of progress, what pillars do for houses and this is the house

call to america, it holds the house up. if you destroy that you bring part of the house crashing down. we can't afford to put social security on par with the rest of the budget. it needs to be considered its own portion. that said, if you're looking at the rest of the budget, aside from social security and medicare then certainly there are important things we need to do with regard to shifting resources to invest in younger people. one is looking at defense spending. thank you. >> any other audience questions? >> to ben's question, one thing about encouraging private savings is wonderful. but each household is its own risk pool. how much money extra do people have to put aside. we have a third of households who make up two-thirds of the

poverty level. they don't have extra money for private savings. programs that incentivize private savings makes it is the affluent more affluent and doesn't help lower income folks. if we increase the payroll tax by 1% as this poll suggests would be supported by americans then we can use the entire nationwide pool to redistribute a little bit more from higherers to low. they don't have success income to put aside on their own. >> there are different variables. we want to talk about where the will to put more money is. there is an economic consideration. it's good for the economy. we don't have a high savings rate in this country.

one of the problems with social security is we haven't figured out how if we prefund it, put more revenues into the system we can wall that off to increase national savings. it's been unclear and it seems they didn't increase net national savings. we haven't come up with more ideas. you would like to see it increase national savings. that would be good for the economy as a whole. >> we do believe we theed to increase savings as a form of wealth for particularly low income, low net worth households. so child savings accounts is something we are in favor of. baby bonds where you create accounts that allow children to acrew interest and earnings over a lifetime. these are things we are in favor

of. outside the social security system. there is a lot we can do for asset building in communities of color and low income populations. it's an avenue we should consider. >> the baby roth ira account has been proposed a number of times. it's an intriguing idea. even with a small investment of dollars when a baby is born those dollars compound tremendously over a lifetime. any other audience questions? i have one last for the panel which is confidence improves. it made me think as a member of the media what do you think of the media's role here in trying to inform the public better and what kind of grades would you give the press in doing that?

>> it is no secret that the american public has been done a severe disser vis when it comes to accurate information. particularly social security. we allowed partisan politics and the message and talk points to guide the narrative. regardless of the facts in many cases. that's what's perfect about this report. they seek to educate the american people about the facts, just the factses. they find that when the american people are informed they make different decisions. we have to educate the media.

the -- professional journalism has been decimated and many organizations are operating on shoe strings and people don't have the expertise they need to report accurately. we have to make sure they can discern the information and explain toyota people. virginia, you have been an expert here for a long time. getting better, worse in terms of press coverage? >> i think perhaps the it is press is beginning to get better. for a long time the story about social security, its strength is its own enemy it's so fiscally responsible every year a trustee's report looks 75 year spos the future and says how are

we doing? this system can't borrow money. it hases to pay for itself by raising taxeses or cutting benefits if it should get out of balance. through that fiscal responsibility the story every year is when is it going bankrupt? well, it's not. it has a short fall. it's time to talk in a different way. >> a couple of years ago michael ast r trk astrub was begging journalists to understand the term exhaustion and not to use the term bankrupt. sure enough all the stories were social security is going bankrupt. there is no winsing. >> it's important.

the trustees look forward and say where we are going. the trustees are saying there is an imbalance. it's not like this is a perfectly rosy situation. go read the trustee report. some of the best information -- the congressional budget office puts out great information if people want to learn impartial stuff. you can learn more than you have ever wanted to know. if you go to the fist documentses it's a great place for people to start. >> great point. i think we are out of time. we need to wrap up. let me remind you about filling out evaluation forms. let me thank the panelists for doing a wonderful job. thanks to the academy for convening us this morning to hear about the important new study.