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Social Security Innovation Opportunity: How We Can Nurture New Ideas

Policymakers have been talking on and off for decades about ways to make Social Security solvent and adequate. However, the conversation often seems stuck in the 1980s, the last time Social Security was addressed, with a small set of policy tools to raise revenue or cut benefits being recommended by each politician or group.

Yet most of those standard tools are not well-designed. Take, for example, the proposal to raise the retirement age. Policymakers often cite the fact that average life expectancy has risen over the last several decades and that more people are working longer. Raising the retirement age effectively cuts all retirees benefits by roughly 8 percent. Yet, all retirees are not equal. For some populations, such as white women without a high school education, life expectancy has actually dropped, and low-income individuals in general have seen much smaller gains in life expectancy than high income individuals. And many older workers are in physically demanding jobs, making it difficult to work into their late 60s.

We need new ideas, and we need to understand their impact on current and future generations. That’s why last year we issued a Policy Innovation Challenge for Social Security Adequacy.

Through the Challenge, we asked, how can we make Social Security better? The result was the development of seven papers detailing solutions to strengthen the adequacy of Social Security benefits.

Social Security clearly is one of the most successful and trusted federal programs out there. It’s also relied upon by a vast majority of Americans, both through the program’s survivor retirement benefits as well as disability insurance protections. But any longstanding program affecting so many people will need attention as time passes, and to say that society has changed a little since President Roosevelt signed Social Security legislation into law in 1935 would be an understatement. Today, for example, many older Americans rely more heavily than ever on their Social Security checks, despite the program never being intended to provide a sole source of income. While the retirement age is already increasing from 65 to 67, the program does not take into account the extra tools individuals will need to stay relevant in today’s economy and the impact job loss, health, and caregiving have on Americans’ retirement.

The variables at play in today’s workforce are many. They present both challenges and opportunities, and that’s where our Challenge comes in. AARP received an overwhelming number of responses, coming from thought leaders from across the country. After review by AARP staff for technical compliance, applications progressed to a blind review by an expert panel, which included the directors of the Retirement Research Centers at the University of Michigan, Boston College, and the National Bureau of Economic Research. The multistep process resulted in the selection of a set of policy innovations to receive financial support for further development. As an economist with a long-time passion for the area of retirement security, I was so inspired by the Challenge myself that I jumped in and put pen to paper to develop a concept for the blind-review process. (AARP authors were not eligible for the funding award.)

I’m thrilled to say that the project has uncovered some innovative ideas. We discussed the solutions this week, when the National Academy of Social Insurance and AARP joined to convene a policy forum, “New Approaches to Social Security Adequacy & Solvency in the 21st Century.” At the event, authors and other policy experts described and debated the innovative Social Security ideas coming out of the Challenge as well as those from other sources. Each idea was independently analyzed by the Urban Institute to show how it will impact the benefits for future generations, as well as the solvency of the program.

We hope that these ideas make an impact on the next discussion about Social Security. Great policy happens when solutions are carefully developed and then examined from all angles, by many people, and through interactive means. We hope you will check out the ideas at and think of your own ways to improve the system.

Debra Whitman is AARP’s chief public policy officer and leads policy development, analysis and research, as well as global thought leadership that supports and advances the interests of individuals age 50-plus and their families. Follow Deb on Twitter: @policydeb

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