Social Security: Equity, Adequacy, Reforms

Publication Date: January 1996

Publisher: RAND Corporation

Author(s): Lee A. Lillard; Constantijn (Stan) Panis

Research Area: Banking and finance

Type: Brief

Abstract:

This documented briefing examines the U.S. Social Security System (SSS) against two key principles: individual equity and social adequacy. Socioeconomic differences among those who benefit from the SSS provide insight into the tradeoff between equity and adequacy under the current system. Amendments to the SSS being debated today will change that tradeoff by shifting the balance between equity and adequacy. This study examines the Old-Age and Survivors Insurance Program, which provides benefits to retired workers, their spouses and widows. Proposed amendments to the SSS are assessed for their different effects by income group and birth cohort. The study finds that the current SSS is not as progressive as often thought, but leaves it up to lawmakers to decide on a fair distribution plan.