Social Security Isn't Racist

Raising the retirement age to 69 will mean fewer years of benefits for African Americans, but the real issue is why so many of us die sooner.

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The bipartisan co-chairs of a presidential commission that was convened to cut the budget deficit recommended  on Wednesday raising the Social Security retirement age to 68 by 2050 and 69 by 2075. Certain physically taxing jobs would be given a "hardship exception," according to the commission's report, but if Congress enacts the retirement extensions, the majority of Americans can look forward to working until they're almost 70 within the next several decades.

Elsewhere on Wednesday, the American Human Development Project released a related report, though, if you weren't looking for it, the correlation between the two was subtle at first. According to the AHDP's research, African Americans living in Washington, D.C., have a lower life expectancy, at 71 years, than African Americans in any state. Whites in the District, on the other hand, have a longer life expectancy than whites in any state, at 83.1 years. The disparity is shocking, but it's nothing new: In 1999, for example, the Centers for Disease Control and Prevention declared that the average American could expect to live 77.8 years, while the average African American could expect to live only 73.1 years.

In other words, regardless of where they live, blacks in America are dying much sooner than their white counterparts. This is troubling irrespective of context, but when we juxtapose this fact with the potentially higher retirement age, we're smacked with another hard truth: In another generation, it's very possible that blacks will receive Social Security for all of two or three years before they die, despite having paid as much as any other Americans into the system.

Back in 2005, conservative author Rich Lowry attempted to make the case in the National Review that Social Security is racist. Noting that the average rate of return from Social Security for young people in Charlie Rangel's heavily black New York district would be negative 8 percent less than they put in, Lowry concluded that Social Security was bigoted. "If young blacks were being fleeced in this way by, say, 'predatory lenders,' the likes of Rangel would scream racism and demand change," he wrote. "But if they are financially abused by a liberal sacred cow, the implicit message is: Don't get uppity."

Lowry's conclusion -- and it's a common conservative talking point -- is that Social Security should be privatized in order to fairly distribute the payouts among the races. "Private Social Security accounts would help address this deficit," he says. "[Democrats] should think of the accounts as financial affirmative action, or any other government initiative meant to benefit blacks. According to the ideology of black victimhood, blacks are apparently owed everything -- except a better opportunity to save and own their own retirement assets."

There is perhaps no greater example of tossing the baby out with the bathwater than this horrible line of thinking: Blacks die sooner than whites, so let's privatize Social Security in order to get them some more money before they die.

If workers invest part of their Social Security taxes in personal accounts, they could indeed earn higher returns and generate higher benefits without taking more risk. But diverting taxes to accounts leaves the program short of what is needed to pay benefits to today's retirees. To cover these "transition costs," we would need to generate new revenues for the program, either by raising taxes, cutting other programs, or borrowing. But once transition costs are accounted for, the total rate of return on a personal-accounts-based program would be about the same as the current system.

Second, and what's more troubling, is that arguments like Lowry's are so cleverly racist that their insidiousness is far worse than any stupid Tea Party sign. Lowry, and people like him, don't say, "Perhaps, rather than focusing on private Social Security accounts, we should consider why black people are dying wholesale much earlier than white people." Instead they say, "Let's just make sure to get black people some more money before they die years before the rest of us."

To Lowry, that we're dying absurdly early is a secondary or tertiary problem; what matters most is ending social-welfare programs.

The U.S. budget deficit is currently $1.3 trillion, and the national debt is at almost $14 trillion. It's inarguable that something needs to change, and that modifications to Social Security could certainly help that change along. It's also inarguable that one of those modifications could be changing the retirement age (beyond the president's deficit commission, the Atlantic suggested the same in August). But what nobody should say is that Social Security is somehow racist.

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