Cato Institute 6.2 Retirement Solution

Social Security has long been a subject of reform, with many finding the pay-as-you-go, or PAYGO, system inefficient, becoming more problematic by the Baby Boomers reaching retirement age, putting more strain on the system. On option for reform is the Cato Institute, which plans to split split the Social Security payments in half. Just like many reform propositions, has detractors, this, for example, this is a frightening proposition for those already receiving benefits, since there would be less taxes entering. The Cato Institute’s ”6.2 Percent Solution” is one of many policy recommendations to help reform Social Security, but one which is especially frightening to the elderly. The Cato Institute builds its proposition on notion which former President Bill Clinton said “The only way to keep Social Security solvent is (a) raise taxes, (b) cut benefits, or (c) get a high rate of return through private capital investment “ (Tanner, 3).The Cato institute tries to accomplish former President Clintons third option by taking 6.2% of the 12.4% of taxes you pay into Social Security and either keep …show more content…
It allows for people to utilize half of their Social Security taxes, 6.2%, to invest it in stocks and bonds, rather than using the PAYGO system. This proposition definitely is not as divided along party lines as other policies are, which would give it a high likelihood of passage. Yet when we look between age groups, this is quite opposed by the elderly while being supported by the younger generations. This provides a problem, because, the elderly are more likely to vote, making them a more valuable constituent, in all making this policy less likely to pass. In all, although this is supported across party line and, by the younger crowd, the higher turnout rate of the elderly, makes this proposition unlikely to