Recently, I came across a blog post on the Mother Jones Web site that put in the starkest terms I've ever seen the reality of the retirement crisis.
It's important to note that Mother Jones is a left-leaning publication, to say the least, and some writers - like many that lean far left or far right - can get caught up in hyperbole.
That said, I don't think MJ senior correspondent James Ridgeway is exaggerating when he writes that "visions of golden years spent playing golf in Tucson or bridge in Boca Raton, promoted by AARP magazine and purveyors of retirement investments, are now nothing more than a chimera for most Americans. The exception, of course, is a wealthy minority ... For everyone else, old age been reduced to three alternatives: Those of us lucky enough to have jobs can keep working indefinitely; the rest can live poor or die."
This guy really knows how to suck the fun out of a room, huh?
Retirement income deficit growing
To help make his point, Ridgeway recounts Retirement USA's calculation of the retirement income deficit - the gap between the pensions and retirement savings that American households have today and what they should have today to maintain their living standards in retirement - which stands at $6.6 trillion and counting. The organization notes that the number - already eye-popping - is a conservative estimate.
"The key sources of income that retirees have relied on are either under attack - in the case of Social Security - or disappearing - in the case of traditional pensions," Ross Eisenbrey, vice president of the Economic Policy Institute, said at an event this fall to kick off "Wake Up, Washington!" Month (Sept. 15 to Oct. 15).
"401(k) plans are not working, and millions of workers have neither a pension nor a 401(k) account. Clearly, the current private retirement system is failing most Americans," Eisenbrey added.
Eisenbrey's and Ridgeway's bluntness made me cringe, and then consider: Maybe they're right. Maybe for all your work trying to offer and encourage participation in retirement benefits, retirement plans are failing most workers, and the behavioral and economic reality is that retirement options really boil down to the three Ridgeway mentioned.
Are the French onto something?
With "frying-pan-or-fire" choices like that, it's a wonder American workers aren't rioting over the retirement system, like their French counterparts. You likely saw/heard/read the news reports coming from France a few months ago, as infuriated workers burned cars and blocked streets in protest of a government to raise the nation's retirement age from 60 to 62.
My first thought was hoping no one was harmed. Secondly, I thought, "Those French people want to have it all - with their 35-hour workweek and their guaranteed five weeks of vacation. Now they're grumbling about working two more measly years, when many Americans have given up the idea of retiring at all?! Pfft!"
But then I thought maybe there's a method to their madness.
Here in the States, there already are some in Congress who favor raising the retirement age - currently 67 for folks born in 1960 or later, unless they take early retirement at 62 - to age 70.
And while I'm sure there are some groups that would protest loudly should such proposals gain momentum, I doubt people would take to the streets to the point that police would maintain order in full riot gear.
More likely, we'd grumble a lot and perhaps hold a Washington, D.C. rally or two. But in the end, just sigh ... and keep on working.
But is that the right response? Should we protest like the French about the idea of changing the retirement age and/or retirement system? Heck, should we protest the system we have now? Send me your comments and/or your ideas on where to buy the best pitchforks.
Send letters, queries and story ideas to Editor-in-Chief Kelley M. Butler at firstname.lastname@example.org.
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