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The B.E. Journal of Economic Analysis & Policy

Editor-in-Chief: Jürges, Hendrik / Ludwig, Sandra

Ed. by Auriol , Emmanuelle / Brunner, Johann / Fleck, Robert / Mendola, Mariapia / Requate, Till / Schirle, Tammy / de Vries, Frans / Zulehner, Christine

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Volume 1, Issue 1 (Oct 2002)


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Volume 1 (2001)

An Assessment of the Proposals of the President's Commission to Strengthen Social Security

Peter Diamond / Peter R. Orszag
Published Online: 2002-10-22 | DOI: https://doi.org/10.2202/1538-0645.1072


The President's Commission to Strengthen Social Security proposed three plans for reforming Social Security. All of them would create individual accounts financed by diverting funds from the Social Security Trust Fund. One of the three Commission proposals (Model 1) would not restore long-term balance to Social Security. This paper focuses on the other two proposals - Models 2 and 3 - which would restore long-term balance. Models 2 and 3 contain a number of elements and are quite complicated. To understand the plans, we describe their proposed changes to Social Security benefits (which we refer to as "traditional benefits"), the individual accounts that the plans would establish, the combined effect on retirement income from the changes in traditional Social Security benefits and the individual accounts, and the impact on Social Security financing and the rest of the budget.

Keywords: Social Security; individual accounts

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Published Online: 2002-10-22

Citation Information: Contributions in Economic Analysis & Policy, ISSN (Online) 1538-0645, DOI: https://doi.org/10.2202/1538-0645.1072.

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