Thursday, August 20, 2009

Bernanke Recommends Increasing Retirement Age to 108

Bernanke Recommends Increasing Retirement Age to 108

by Bill Britton

WASHINGTON, D.C. — On Wednesday, Federal Reserve Chairman Ben Bernanke said Congress should rein in future Social Security and Medicare costs by raising the retirement age to 108. The Fed chief's comments stirred political ripples, with Senator John Kerry (D-MA) saying he would favor sending members of Congress, who vote in favor of reduced benefits, to Guantanamo Bay’s terrorist resort where they could live out their Golden Years. Other Capitol Hill Democrats said the previous administration’s tax cuts were to blame, although they admitted to benefitting from them.

President Obama said he would safeguard those at or near retirement, in particular Vice President Biden, something that former Fed Chairman Alan Greenspan suggested as well. Urging swift action on the spiraling budget deficit, forecast to hit a record $482 billion this year, Greenspan told the House of Representatives Budget Committee that spending restraints were the best way to meet future commitments, rather than raising taxes on millionaires and endangering their children’s inheritance: “The exact magnitude of said risk is very difficult to calculate, given the egregious duplicitousness of arbitrage compexities in the secondary market, but they are of enough alarm, in my judgment, to warrant closing the fiscal fissure primarily, if not wholly, by reducing benefits due the common Joe-the-Plumber, or Rosy-the-Riveter, or other marginally contributory fringe input to economic viability.”

In response to questions, Greenspan said failure to tackle looming budget shortfalls would push long-term interest rates higher—a potential constraint on the economy—and would jeopardize his personal fortune and thus annoy his wife, NBC correspondent Andrea Mitchell. He emphasized that “if Congress were to reduce social security benefits, it had better do so quickly to minimize the pain on voters near retirement. In this way, later retirees would have time to digest a smaller piece of the retirement pie as well as to cultivate a taste for Alpo.”

Obama warned of this looming budget crunch as tens of millions of baby boomers, born in the years after World War II, begin to qualify for early retirement benefits and look for ways to gas up their now-idle Hummers and SUVs. “This dramatic demographic change is certain to place enormous demands on our country's ability to maintain our national ethos of materialism unless action is taken,” he said. “For a variety of reasons, that action is better taken as soon as possible and should come out of the hides of the average Joe, or Rosy, or any other Fox News addict.”

Representative John Boehner (R-OH) said that “even with the so-called normal retirement age climbing to 80 or higher in the next two decades, the years people spend in retirement—sitting in web chairs, drinking six-packs of Bud, and dipping their Twinkies in guacamole—will increase, since Americans are living longer. In view of the upward ratcheting of government programs and the enormous uncertainty about the upper bounds of future demands for medical care, I believe that a thorough review of our commitment to allow old people to screw up their bodies is prudent in the long term.”

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