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Saturday, June 18, 2005

Social Security Favors Trophy Wives Over Poor Single Moms

My standard reasons for opposing Social Security are of course 1) that it is monumental inter-generational theft from young non-voters by voting seniors, and 2) that it socializes the retirement savings industry and thus reduces the nation's savings rate and ultimately its standard of living.  A recent Cato Institute article reminds us that the Social Security status quo is also unfair to minorities, poor single moms, gays, and couples in which both spouses need to work:

The overwhelming support for the status quo from the political left is shocking, and should be appalling to members of the Democratic Party or anyone who holds [its] liberal values.  [Democrats seek] to protect a system that systematically discriminates against core constituencies of the Democratic Party, a system that disproportionately benefits white women who have never worked a day in their lives over all other groups. Is that a status quo that the Democratic Party wants to be associated with?

The article is a good summary, but for the full extent of Social Security's inequities you have to read the entire statement of  the Urban Institute's Eugene Steuerle before the House Ways and Means Committee last month.  He details how Social Security is unfairly stingy to
  • minorities with shorter life expectancy;
  • non-working spouses who get divorced one day shy of ten years;
  • single heads of families, whose spouse can abandon them without any effect on the future benefits of him or his next spouse;
  • dual-earning couples (compared to couples with the same household income earned by a sole breadwinner);
  • unmarried couples, such as gays or co-habiting heterosexuals;
  • people who marry a lower-earning spouse after a ten-year marriage with a higher-earning spouse;
  • people who work for more than 35 years;
while being unfairly generous to
  • divorced people whose former spouse dies early;
  • trophy spouses whose high-earning spouses are much older; and
  • people with multiple ten-year marriages (who thus get to multiply the survivor benefits paid on their behalf).
For more on Social Security, see Cato's and the excellent coverage by Jim Glass at

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