Social Security has money until 2033. Latino workers and the size of their wages will play a significant role in guaranteeing the future of this retirement fund.
A few days ago, an annual projection about the status of Social Security was released, which refuted doomsayers who predict its death with the goal of privatizing it. This fund has eliminated extreme poverty for seniors and does not need to go to the Wall Street casino to become stronger.
In reality, the fund’s strength comes from payroll tax deductions. At this time, baby boomers one of the largest generations in the U.S.are retiring, and today’s workers are paying for their retirement. This is a young workforce that is increasingly Latino. Whether because of immigration or its birth rate, the Hispanic community is younger than the average American. The Bureau of Labor Statistics projected that the Latino workforce will grow 30% from 20062016, compared to 5% for others.
The system is not bankrupt, but it will be good to reinforce it. The best way to do so is by increasing salaries, since taxes are tied to income. Another way is to expand the tax cap for the highest-income earners. These are ways to solidify the system with higher tax revenues, while strengthening the economy with more liquidity.
Unfortunately, the idea that gets promoted most is to postpone the retirement age, which punishes today’s taxpayer and tomorrow’s retiree. It also poses the question of what type of jobs will be available for 64 year olds, when our current economy is unable to create jobs for those 55+ who were laid off during the Great Recession.
When it comes to Social Security, many politicians would rather make a good impression on high-income taxpayers, the business sector and retirees, and leave young workers for last. This shows lack of leadership.
Because of the same lack of vision, they do not see that immigrationlike in other industrialized countriesis a much-needed contribution to the security of the retirement system. Otherwise, they would appreciate instead of despising comprehensive immigration reform.