Economic Insecurity Is Becoming The New Hallmark of Old Age
The comments below are an edited and abridged synopsis of an article by Katherine Newman & Rebecca Hayes Jacobs
The US is in a retirement crisis. Nearly half of all private-sector employees (some 58 million) had no company-sponsored retirement plan in 2018. As recently as 1999, only 39% of retiring workers were in this predicament.
Pensions are among the most binding of promises. Americans assign to government the responsibility for protecting this bond from any attempt by companies to raid retirement accounts. This promise has become discretionary, however; employers abandon it when the stock market falters, when a firm goes through financial reorganization, or when shareholders demand higher profits.
Workers have responded to the crisis by planning to work more years than they had expected, only to find that they cannot hold onto the jobs they had in their 50s.
Meanwhile, CEOs are socking away millions of dollars in retirement plans and enjoying the benefits on a tax-deferred basis. In 2014, Fortune 500 chief executives put $197 million into their retirement accounts, saving $78 million on their tax bills in the process. They won’t pay a dime in taxes on those funds until they retire, thus depriving the country of critical resources needed to fund schools, hospitals and other public institutions.
The notion that there is a shared responsibility to secure a decent retirement for citizens is weakening rapidly. There are echoes of the mantra of self-reliance that characterized welfare reform in the 1990s: You alone are in charge of your retirement; if you wind up in poverty in your old age, you have only your own inability to plan, save and invest to blame. This is an unacceptable conclusion.