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Social Security Rates of Return with "Progressive Indexation"

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Publication Date: May 2005

Publisher(s): Center for Economic and Policy Research

Author(s): Dean Baker; David Rosnick

Topic: Government (Public services and utilities)

Keywords: Retirement benefits; Privatized systems; Wage index

Coverage: United States

Abstract:

This paper calculated rates of return for wage earners corresponding to Social Security Administration's definition of low-, medium-, high- and maximum-earners. It finds that the "progressive indexation" proposal endorsed by President Bush would reduce the rate of returns that most workers would receive from Social Security, even with private accounts.

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