The retirement escalator is coming

The Social Security eligibility age is going to rise. You can try to stop it, if you like. You can also try to stop the tide coming in. Every argument about trying to achieve a long term settlement or ‘grand compromise’ concerning the structural deficit in the federal government’s accounts is really an argument about how long raising the retirement age can be postponed.

The Bowles-Simpson Commission proposed a plan which saw the eligibility age rising by two years between now and 2050 and suggested other tax and spending changes. To keep pace with rising life expectancy, the retirement age needs to rise by ten years between now and 2050. The other tax and spending measures were thrown in to keep the short term rise in the retirement age to a minimum.

The other measures are short-term patches to a long-term fiscal crisis. They postpone by a few years the date on which the US will put in place a permanent escalator on the retirement age. So the first step in any sane discussion is to accept the escalator is coming. The only debate is on timing.

The escalator, when it comes, will be three months a year, or one year in every presidential term. Get used to it. You can compromise with your political opponents, but you can’t compromise with arithmetic.

You can postpone the escalator in one of several ways: faster growth, higher taxes, and less spending on other programs. Faster growth is the only painless one. Unfortunately, it is not clear how to achieve it. Even China’s growth rate – a sustained average of over 10% per annum – is unlikely to solve the problem entirely, and no developed country has ever achieved that. Hong Kong and Singapore, with much smaller public sectors than America – have been close. They have already overtaken the living standards of Europe and will soon exceed the US. But even these rates of growth – assuming America could achieve them – would not avoid the need for an escalator.

Higher taxes could also postpone things, but might undercut the higher growth. At a certain point, higher taxes become self-defeating, and higher rates lead to lower revenues. While the US is probably not at that point at the moment, permanently rising tax rates would soon reach that point, so taxes are only a temporary solution.

Cutting expenditure on other programs also has its limit. They cannot be cut below zero, so this, too, is a temporary solution. Even if people were willing to sacrifice all other federal programs, the room for more cuts would become exhausted.

So, that social security eligibility age is definitely going up.

Selfishly, if you happen to be close to eligibility for social security, you might want to see the escalator postponed. After all, if it is postponed beyond your retirement, via cuts to programs you don’t use and taxes on other people, for example, you can squeeze in before the escalator applies. But your children and grandchildren are still going to face the escalator. It cannot be avoided. One hundred years from now, life expectancy will have risen by 25 years. The retirement age is going to rise similarly. 

Some higher taxes – environmental charges, for example – may be desirable, and Common Sense would happily cut every dollar from the Department of Agriculture. But it would still be better to face reality, and bring in the escalator immediately.

Quentin Langley is a Senior Lecturer in Marketing at the University of Bedfordshire Business School as well as a freelance columnist published in the UK and all parts of the US. He blogs on social media and crisis communications at



  1. Quentin, why does there need to be an enforced retirement age still? in this era where people are fitter and healthier and have access to medicine and treatment to keep people ‘running’. Surely if you can perform a job well, your age shouldn’t be one of the cases that prevent you from working?


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